THE  LIBRARY 

OF 

THE  UNIVERSITY 

OF  CALIFORNIA 

LOS  ANGELES 

SCHOOL  OF  LAW 


LISCHER.BAWDEN&NEAL 

La- 


THE  LAW  OF  INSURANCE 

Volume   I 


THE 


LAW  OF  INSURANCE 


AS    APPLIED    TO 


FIRE,  LIFE,  ACCIDENT,  GUARANTEE 

AND   OTHER  NON-MARITIME  RISKS 

BY 

JOHN  WILDER  MAY 

I  V  * 

i?ourtl)  CtJition 

REVISED,    ANALYZED,    AND    GREATLY    ENLARGED 

By  JOHN  M.   GOULD 


IN  TWO   VOLUMES 

Vol.  I 


BOSTON 
LITTLE,  BROWN,  AND  COMPANY 

1900 


Entered  according  to  Act  of  Congress,  in  the  year  1873,  by 

John  Wilder  May 
In  the  office  of  the  Librarian  of  Congress  at  Washington. 

Entered  according  to  Act  of  Congress,  in  the  year  1881,  by 

John  Wilder  May 
In  the  office  of  the  Librarian  of  Congress  at  Washington. 

Copyright,  1891, 
By  Little,  Brown,  and  Company. 

Copyright,  1900, 
By  Little,  Brown,  and  Company. 


John  Wilson  and  Son,  Cambridge,  U.S.A. 


PREFACE  TO   THE   FOURTH  EDITION. 


Judge  May's  treatise  upon  the  Law  of  Insurance  has 
now  for  so  many  years  been  a  recognized  help  to  the 
profession  and  to  the  bench,  and  has  been  so  constantly 
relied  upon,  and  cited  with  such  approval,  as  to  leave 
little  to  be  desired  with  respect  to  its  plan  and  state- 
ment of  principles.  But  the  vast  interests  involved  in 
the  different  forms  of  insurance,  and  the  necessity  of 
having  its  business  conducted  by  sure  and  intelligent 
rules,  appear  to  have  uniformly  conduced  towards  hav- 
ing the  best  legal  talent  engaged  in  the  discussion  of 
new  questions  thereon  before  the  courts,  and  thus,  from 
issues  carefully  raised,  the  development  of  doctrine 
upon  this  topic  has,  it  seems,  been  particularly  system- 
atic, and  upon  clear  lines  of  business  progress  and 
certainty.  This  is  especially  noticeable  in  the  numer- 
ous cases  decided  since  the  last  edition  of  this  treatise 
in  1891,  when  the  painstaking  labors  of  Mr.  Frank 
Parsons  raised  this  book  to  a  high  rank.  His  analysis 
of  chapters,  improvement  of  the  Index,  and  the  addition 
of  important  sections,  discussing  the  problems  involved 


6708^1 


vi  PREFACE  TO   THE  FOURTH   EDITION. 

in  the  decisions  rendered  after  the  author's  second 
edition  in  1882,  made  the  work  very  acceptable  up  to 
that  time.  In  the  present  edition,  the  difficulties  of 
which  have  been  somewhat  increased  by  the  growth  of 
courts  and  decisions,  the  labors  of  the  author  and  of  Mr. 
Parsons  have  been  supplemented  by  the  addition  of  all 
the  more  important  decisions  down  to  the  date  of  going 
to  press,  special  attention  being  given  to  the  very 
latest  decisions,  and  many  new  topics,  not  before 
referred  to  in  the  Index,  being  discussed  from  the 
advanced  standpoint  thus  afforded.  These  new  topics 
include  standard  policies,  incontestable  clauses,  proofs 
of  death  and  of  loss,  additions  to  buildings,  adjacent 
buildings,  removal  of  goods,  duty  of  the  insured  to 
read  his  policy,  etc.,  while  such  leading  heads  as  general 
and  local  agents,  conditions,  forfeiture,  waiver,  suicide 
and  insanity,  assignments,  arbitration,  mutual  and 
foreign  companies,  etc.,  have  been  further  developed 
in  lengthy  notes,  the  value  of  which  can  be  best  deter- 
mined by  use.  About  three  thousand  cases  are  now 
added.  To  make  room  for  these  additions,  the  longer 
quotations  from  opinions  have  been  transferred  from 
the  text  to  the  notes. 

JOHN  M.   GOULD. 

Boston,  October,  1900. 


PREFACE  TO   THE   THIRD   EDITION. 


The  present  edition  of  this  well-known  work  exhibits  a 
growth  corresponding  to  the  vast  increase  of  the  busi- 
ness whose  legal  aspects  are  treated  in  these  volumes. 
This  edition  contains  about  seventy-five  per  cent  more 
matter  than  the  last.  Every  efibrt  has  been  put  forth 
to  make  the  necessary  additions  in  a  manner  worthy 
of  the  high  character  of  the  original  structure.  The 
old  cases  have  been  revised,  and  new  ones  added  to  a 
number  nearly  sufficient  to  double  the  Table  of  Cases. 
All  relevant  decisions  in  the  United  States,  England, 
Scotland,  Ireland,  Canada,  New  Brunswick,  and  Nova 
Scotia,  have  been  examined  down  to  as  recent  a  date 
as  was  possible  before  going  to  press  in  the  spring. 
In  respect  to  courts  of  the  last  resort,  in  the  United 
States,  exhaustiveness  has  been  the  aim  ;  but  in  treat- 
ing the  labors  of  other  courts,  decisions  that  are  merely 
cumulative  authority  upon  undisputed  points  have  been 
frequently  omitted. 

The  analyses  at  the  chapter  heads  are  entirely  new, 
and,  as  a  condensation  of  the  substance  of  Insurance 
Law,  will,  it  is  hoped,  be  found  useful. 


Viii  PREFACE  TO  THE  THIRD   EDITION. 

The  new  matter  in  text  and  notes  is  enclosed  in 
brackets.  Where  possible,  with  due  regard  to  the  value 
of  the  new  material,  it  has  been  consigned  to  the  foot- 
notes, but  many  times  a  place  had  to  be  given  it  in 
the  text,  in  order  to  secure  harmony  of  treatment,  and 
give  equal  attention  to  matter  of  equal  novelty  and 
importance. 

The  old  section  numbers  remain,  almost  without 
exception,  the  same  as  in  the  last  edition ;  the  new 
sections  being  distinguished  by  an  alphabetical  termi- 
nation, for  example,  109  A.  This  edition  contains  six 
more  chapters  than  the  last. 

The  Index  has  been  remodelled,  greatly  increased 
in  size  and  minuteness,  and  in  some  degree  rendered 
analytic  in  its  character. 

FRANK  PARSONS. 
Boston,  1891. 


NOTICE  TO   SECOND   EDITION. 


This  second  edition  has  been  improved  by  a  careful 
revision  of  all  the  cases  cited  in  the  first  edition ;  by 
the  addition  of  about  two  thousand  cases,  mostly  de- 
cided since  the  publication  of  that  edition,  many  of 
them  from   Canadian  and  other  colonial  and  foreign 
reports  not  heretofore  generally  accessible ;  by  a  con- 
siderable enlargement  of  the  Index  ;  by  very  frequent 
cross  references;  and  by  the  elimination  of  such  matter 
of  discussion  as  has  now  become  of  less  relative  im- 
.  portance  since  the  practical  settlement  of  questions  to 
which  it  related. 

The  author  will  not  venture  to  say  that  no  case  has 
escaped  his  notice  ;  but  he  will  be  surprised  if  any 
case  deciding  any  new  and  important  point  shall  be 
found  to  have  been  overlooked. 

The  original  purpose  has  been  kept  steadily  in  view, 
—  to  present  within  a  moderate  compass  a  complete 
summary  of  what  is  to  be  found  of  importance  in  the 
reports  printed  in  the  English  language  upon  the  topics 
under  consideration. 


X  NOTICE   TO   THE   SECOND   EDITION. 

The  author  desires  to  acknowledge  his  obligations 
to  his  professional  brethren  for  their  friendly  criticisms, 

which  he  hopes  will  be  continued,  —  whereby  he 

has  been  able  to  correct  errors  which  otherwise  might 
have  escaped  his  notice,  and  by  which  he  will  be  mate- 
rially assisted  in  his  efforts  to  present  them  with  a  safe 
guide  to  their  investigations. 

J.  W.  M. 

Boston,  Jan.  1,  1882. 


PREFACE  TO   THE   FIRST  EDITION. 


An  effort  has  been  made  in  the  following  pages  to 
give,  within  the  limits  of  an  ordinary  volume,  such  a 
statement  of  the  law  of  Insurance  as  applicable  to  non- 
maritime    subject-matters,    as  will   meet   the    require- 
ments of  those  engaged  in  the  various  branches  of  the 
business,  the  student,  and  the  practising  lawyer.     To 
extract  from  the  wealth  of  material  furnished  by  the 
reports  so  much  as  seems  to  be  essential  to  a  correct 
understanding  of  the  results  arrived  at ;  to  set  it  out 
with  the  requisite  fulness  and  precision;  and  to  fuse 
the  whole  into  a  form  having  method,  unity,  and  com- 
pleteness, —  has   been   found   to  be  a  work  of  much 
greater  difficulty  than  was  foreseen.     Nevertheless,  by 
a  studied  brevity  in  the  statement  of  the  earlier  ques- 
tions which  may  now  be  regarded  as  settled,  room  has 
been  found  to  present,  with  considerable  fulness,  the 
discussions  to  be  found  in  the  reports  upon  many  of  the 
more  recent  questions  which  may  be  regarded  as  still 
undergoing  the  process  of  elaboration  ;  such,  for  exam- 
ple, as  the  liability  for  loss  by  explosion,  how  far  suicide 


Xii  PREFACE  TO  THE  FIRST  EDITION. 

is  a  defence,  and  the  import  of  the  phrase,  "  travelling 
by  public  conveyance."  Such  a  work,  however,  can 
never  be  truly  said  to  be  finished.  That  it  has  been 
successfully  begun,  is  more  than  the  author  will  ven- 
ture to  affirm.  Still,  he  believes  that  the  profession  will 
here  find  results  which,  however  imperfect,  they  will 
welcome  as  a  foretaste  of  something  better,  bearing, 
he  trusts,  such  evidence  of  an  earnest  purpose  to  sub- 
serve their  interests  as  they  have  a  right  to  expect 
from 

THE  AUTHOR. 
Boston,  December,  1873. 


CONTENTS  OF  YOL.  I. 


Page 

TABLE  OF  CASES xv 

CHAPTER  I. 
Of  the  Nature  of  the  Contract 1 

CHAPTER   II 

Of  the  Form  of  the  Contract  and  the  Parties  thereto      26 

CHAPTER  in. 
The  Effect  of  War 53 

CHAPTER  IV. 
Consummation  of  the  Contract 68 

CHAPTER   V. 
Termination  and  Revival hq 

CHAPTER  VI. 
Subject-matter.     Insurable  Interest 13g 

CHAPTER   VII. 
Agents,  their  Powers  and  Duties 212 

CHAPTER  VIII. 
Warranties,  Application,  Construction 304 


CONTENTS. 
XIV 

CHAPTER  IX.  PAGE 

362 

Representation 

CHAPTER  X. 

397 
Ok  Concealment     

CHAPTER  XI. 
Special  Provisions  of  the  Contract,   Increase  of  Risk, 
Alteration,   Use,   Vacancy,  Watchman,  Working   of 

y|  O  7 

Mills,  Care  of  Books,  etc *-' 

CHAPTER  Xll. 

' 540 

Alienation 

CHAPTER  XIII. 

KQA 

Title  and  Incumbrance *^*^" 

CHAPTER  XIV. 

Health,  Habits,  Age,  etc 622 

CHAPTER  XV. 
Suicide ^^^ 

CHAPTER  XVI. 

Of  Death  by  Law,  or  while  violating  it,  by  Violence, 
Casualty,  or  War;  and  of  Restrictions  upon  Resi- 
dence AND  Travel 696 


TABLE  OF  CASES. 


[the  references  are  to  the  sections.] 


Section 
Abbinett  v.  N.  W.  Mut.  L.  Ins.  Co.  3yy  D 
Abbott   V.    Hampden    Mut.    Fire 

Ins.  Co.  81,  264,  271 

V.  Howard  181,  201,  212,  304 

V.  Sebor  79 

V.  Shawmut  Mut.   Fire   Ins. 

Co.  145,  206,  258,  287 

Abe  Lincoln  Mut.  L.  &  A.  Soc.  v. 

Miller  399  D 

Abel  r.  Phoenix  Ins.  Co.  21 

Accident  Ins.  Co.  v.  Crandal    307,  322, 

325 

Acer  V.  Merchants'  Ins.  Co.       83  a,  86 

Acie  V.  Fernie  136 

Acker,  Receiver,  u.  Hite  555 

Adair  v.  Southern  Mut.  Ins.  Co.  230,  240 

Adams  v.  Greenwich  Ins.  Co.       249  H 

V.  Ins.  Co.  493 

V.  Lindsell  46 

V.  Manufacturers',  &c.  F.  Ins. 

Co.  67  H 

V.  Natl.  Ins.  Co.  493  A 

V.  New    York    Bowery   Fire 

Ins.  Co.  420,  492 

V.  Otterbach  582 

J'.  Rockingham  Mutual  Fire  j 

Ins.  Co.  204  ! 

Adamson,  Ex  parte  497  , 

Addison  v.  Kentucky,  &c.  Ins.  Co.  80, 

293 
Adema  v.  Ins.  Co.  287 

Adkins  v.  Columbia  Life  Ins.  Co.     322 
Adrevery  v.  Mut.  Reserve  Fund 

L.  Ass.  508,  579 

Adriance  v.  Roome  63 

.^tna  Ins.  Co.  v.  Baker  456 

V.  Black  590 

V.  Boon  403 

V.  Farrell  465 

V.  Glasjjow  Electric  Light  & 

Power  Co.  402,  421  a 

V.  Grube  159,  161 

V.  Han   and  St.  Jo.  R.  R.  454 

V.  Harvey  577 

V.  Jackson      80,  83  a,  175.  268,  420 
V.  Jolinson  423  A,  583 


Section 
^tna  Ins.  Co.  v.  Kittles  590 

V.  McGinness  67 

V.  McGuire  485,  509 

V.  McLead  465,  494,  589 

V.  Meyers  249 

V.  Miera  87,  466 

V.  Norman  405 

V.  N.  W.  Iron  Co.  23  B 

V  People's  Bank  of  Greenville  466 
V.  Phelps  590 

V.  Resh  277,  291 

V.  Shryer  138,  469  D 

V.  Sparks  504  E 

V.  Stevens  465,  496  B 

V.  Tyler     37  A,  254,  365,  377,  424, 
456,  457,  466,  468,  473 
^tna  Life  Ins.  Co.  v.  Brodie        679  B 
V.  Davey  301 

V.  Deming  299,  465 

V.  Florida  327 

V.  France       107,  110,  185,  186,  297 
V.  Hanna  299 

V.  Holcomb  144  D 

1-.  Paul  133  A,  567,  569 

V.  Smith  175,  187,  360 

V.  Ward  299 

^tna  Live  Stock,  &c.  Ins.  Co.  v. 

Olmstead  131,  294  b,  498,  499 

Agen  V.  Met'n  L.  Ins.  Co.  323,  .325 

Agnew  V.  Ins.  Co.  404 

Agricultural  Ins.  Co.  v.  Bemiller     175, 

207,  466 

V.  Hamilton  189,  247 

i'.  Montague  81,  360  B 

v.  Potts  369 

Ahlberg  ;•.  German  Ins.  Co.  294 

Akers  v.  Hite  69  B 

Akin  V.  Liverpool,  &c.  Ins.  Co.  44,  469, 

488 
Alabama  Gold   Life  Ins.  Co.  v. 

Garner  144  A, 156,  188  A 

V.  Herron  60 

V.  Johnston  156,  162.  175 

V.  Mayer  23,  58 

V.  Mobile  Mut.  Ins.  Co  398 

Alabama   State  Mut.  Ass.  Co.  v. 
Long  Clothing  &  Shoe  Co.  369 

XV 


TABLE   OF   CASES. 


[The  references  are  to  the  sections.] 


Section 
AUaTt  V.  Mutual  L.  Ins.  Co.  lOo  A,  112, 
158,  187,  305,  340 
Albert  Life  Ins.  Co.,  In  re  358 

Albion  Lead  Works  r.  Williams- 
burg City  Fire  Ins.  Co.         158,  159, 
171,248,250 
Alderman  v.  West  of  Scotland  Ins. 

Va.  466 

A  111  rich  r.  Equitable  Safety  Ins. 

Co.  95  A 

I'.  Mercantile  Mut.  Ace.  Ass'n  306 

Aldridge  v.  Gt.  Western  R.  R.  Co.  454 

Alehouse  v.  Savile  28 

Alexander  v.  Atlanta  Ace.  Ass'n  515  a, 

517  A 

V.  Continental  Ins.  Co.  345  H,  360  C 

r.  Geniiania  Fire  Ins.  Co.  247 

Alexander's  Cotton  38 

Alkau  I'.  X.  H.  Ins.  Co.        207,  249  G, 

273  A 

AlU'fire  V.  Maryland  Ins.  Co.  469 

Allemannia  F.  Ins.  Co.  v.  Hurd        369 

V.  Little  478,  488 

I'.  Peck  279,  479 

Allen  I'.  Cliarlestovvn  Mut.  Ins.  Co.  258, 

285,  287 

V.  Franklin  Fire  Ins.  Co.  81 

V.  Frecdman's  S.  T.  Co.  23  1) 

V.  German-American  Ins.  Co.    369 

V.  Hartford  L.  Ins.  Co.  399  D 

V.  Hudson  R.  Mut.  Ins.  Co.        294 

V.  Mass.  Mut.  Ins.  Co.  502  a 

r.  Massasoit  Ins.  Co.  221 

V.  .Mercli.  M.  Ins.  Co.  478 

V.  Mutual  Fire  Ins.  Co.       219,  287 

V.  Ojjden  126 

V.  Thompson  459  E 

V.  Vermont  Mut.  Fire  Ins.  Co.  .505, 

553 

V.  Watertown  Ins.  Co.  457  C 

V.  "Winne  560 

Alletson  r.  Chichester  -<95 

Alk'vn  V.  Quebec  Ins.  Co.  432 

Allu'cyor  ?•.  Louisiana  578a 

Alliance  Mar.  Ins.  Co.  v.  Lou.  St. 

Ins.  Co.  4.57 

Alliance  Mut.  Ins.  Co.  v.  Swift  67,  555 
Allis  r.  Ware  .391  A,  399  L 

Allison  V.  Corn.  Exch.  Ins.  Co.        417 
V.  Phenix  Ins.  Co.  365,  456 

Aloe   v.    Mut.   Reserve  Fund   L. 

Ass'n  298,  303 

Alsop  V.  Conn.  Ins.  Co.  30,  33 

Alspangh  r.  British-American  Ins. 

Co.  253 

Alston  V.  Mechanics' Ins.  Co.  192 

r.  Old  North  State  Ins.  Co.  248,  249 

)•.  Phenix  Ins.  Co.  469  C 

Alter  V.  Home  Ins.  Co.  412 

Althorp  V.  Wolf  455 

xvi 


Section 

Amazon  Ins.  Co.  v.  Steamboat         454 
V.  Wall  378 

American  Ace.  Co.  v.  Reigart      517  A 

American  Artistic  G.    S.    Co.    v. 

Glenn  Falls  Ins.  Co.  159 

American  Bk.  r.  HoUins  459  G 

American  Basket  Co.  v.  Farmville 
Ins.  Co.  75  A,  287 

Americar  Building  &  Loan  Ass'n 

V.  Farmers'  Ins.  Co.  478 

American  Central  Ins.  Co.  v.  Bass  494 
V.  Brown  409 

V.  Clarey  249  F 

V.  Heaverin  469  D 

V.  McCrea  253  B,  370 

V.  McLanathan  81,  143,  430 

V.  Rothschild  466 

V.  Sweetser  452  F,  469  C,  589 

V.  Ware  263  A 

American  Credit   Indemnity  Co. 

V.  Alliens  Woolen  Mills  2 

r.  Carrollton  F.  M.  Co.  2,  159, 

459  E,  460 

V.  Wood  279,  452  F,  544 

American  Employers'  L.  Ins.  Co. 

V.  Barr  112 

American  Express  Co.  v.  Triumph 
Ins.  Co.  464,  506 

Am.   Fire   Ins.  Co.    v.   Brighton 

Cotton  Manuf.  Co.  248,  253,  253  A 
V.  Brooks  67,  70  B,  125,  500 

V.  Hazen  452 

American  Horse  Ins.  Co.  v.  Pat- 
terson 44,  400,  547 

Am.  Ins.  Co.  v.  Bryan  411  A 

V.  Copps  135 

r.  Cougle  341  a 

V.  Crawford  573 

V.  Foster  248 

V.  Gallagher  384 

V.  Gallatin  143 

V.  Gilbert  159,  373  B,  374 

r.  Henley  341  a 

!^.  Klink  341a,  .343 

I'.  Leonard  345  E 

V.  Luttrell  372  C 

V.  Mahone  -  144,  497 

V.  Padelfield  248,  249  C 

V.  Pane  166 

V.  Pettijohn  577 

V.  Pressell  345  G 

V.  Replogle  365  B 

V.  Schmidt  557 

V.  Stoy  841  a,  577 

V.  Weiberger  566  B 

V.  Wellman  577 

V.  Wilder  13.3 

V.  Woodruff  67 

American    Legion    of    Honor   v. 
Smith  399  p,  399  0 


TABLE  OF  CASES. 


[The  references  are  to  the  sections.] 


Section 
American  Life  Ins.  Co.  i\  Greene  360 
Am.  L  Ins.  Co.  v.  McAden  5(37,  679 
American  Life  &  H.  Ins.  Co.  v. 

Robertshavv  109 

Americari  Pop.  Life  Ins.  Co.  v.  Day  159, 

1(J4,  465 
American  Towing  Co.  v.  German 

Fire  Ins.  Co.  •lO'i 

Amer.  Underwriters'  Ass.  v.  George  589 

Ames  V.  N.  Y.  Union  lus.  Co.  132,  141, 

143,  371,  505 

V.  Richardson  456 

Amesbury  et  at.  v.  Bovvditch  Mut. 

Fire  Ins.  Co.  478,  490,  491 

Amey  c  Granite  State  F.  Ins.  Co.  405 
Amicable  Ins.  Soc.  v.  Bolland  8li3,  S2B 
Amick  V.  Butler  75  B,  108,  459  A 

Amis  V.  Witt  399  C 

Amory  v.  Giiman  74 

Amsinck  v.  American  Ins.  Co.  96 

Anclior  Life  Ins.  Co.  v.  Pease       345  B 
Ancient   Order  of  United  Work- 
men V.  Moore  345  a,  550 « 
Anctil  V.  Manufacturers'  L.  Ins. 

Co.  478 

Anderson  v.  Butterly  o'Jl 

V.  Commercial  Union  Ass.  Co.  430 
V.  Coonley  129 

V.  Edie  108 

V.  Fitzgerald         156,  170,  185,  303 
V.  Goldsmidt  391  A 

V.  Manchester  F.  Ass.  Co.     249.1, 
263  E 
V.  Miller  453 

V.  Morice  107  a 

V.  Mutual  Reserve  Fund  L. 

Ass'n  360 

V.  Scottish    Ace.     Ins.     Co. 

(Lira.)  518  A 

V.  St.  Louis,  &c.  Ins.  Co.  845  a 

V.  Thornton  567 

Anderton  i'.  Home  Ins.  Co.  224 

Andes  Ins.  Co.  v.  Fish        144  B,  424  A 

V.  Loeiiy  140 

V.  Shipman  159,  240,  503 

Andree  v.  Fletcher  10,  567 

Andrews,  Ex  jnuie  459  A 

V.  JEtna.  L.  Ins.  Co.     130  A,  344  A 

V.  Ellison  28 

V.  Essex  F.  and  M.  Ins.  Co.        566 

V.  Union  Mut.  Fire  Ins.  Co.        35, 

406 
Angel  V.  Hartford  Fire  Ins.  Co.       129, 

1-34 
Angelrodt  v.  Delaware  Ins.  Co.  435 
Angier  u.  Western  Ass.  Co.  239  A, 

409  C 
Annan  v.  Hill  Union  Brewery  Co.  557 
Annn polls  R.  R.  Co.  v.  Baltimore 
Fire  Ins.  Co.  219,  222,  420 

VOL.  I.  —  b 


Section 
Annely  v.  De  Saussure  81 

Anoka  Lumber  Co.  v.  Fidelity  & 

Casualty  Co.  2,  379 

Anonymous  455 

Anson  v.  Winnishiek  Ins.  Co.  131, 

365,  502,  502  a,  508 
Antes  v.  Western  Ass.  Co.  369 

Anthony  v.  Mass.  Ben.  Ass'n  379 

V.  Slaid  453 

Antiiracite  Coal  Co.  v.  Sears  388 

Appeal  of  Elliott's  Exrs.  391  B 

Appeal  of  Susquehanna  Ins.  Co. 

560  A,  563 
Appleby  v.  Astor  Ins.  Co.  239 

i\  Fireman's  Fund  Ins.  Co.        227 
Appieton  Iron    Co.  v.  Brit.  Am. 

Ass.  Co.  170,  264,  386 

Appieton  Mut.  Ins.  Co.  v.  Jesser     552, 

557 
Application  of  Corson  100  A,  102  A 
Arazo  v.  Currell  331 

Archbold  v.  Merchants'  Mar.  Ins. 

Co.  452  B 

Archer  v.  Merch.  &  Manuf.  Ins. 

Co.  239,  386 

Archibald  v.  Mut.  Life  Ins.  Co.       297, 
390,  391 
Arctic  Ins.  Co.  v.  Austin  408 

Arff  V.  Star  Ins.  Co.  126,  369,  500 

Argall  V.  Ins.  Co.  462,  409  C 

Arkansas  F.  Ins.  Co.  v.  Wilson     287  B 
Ark.  Ins.  Co.  v.  Bostick  420  B 

Arkell  ik  Commerce  Ins.  Co.    239,  258 
Armenia  Ins.  Co.  v.  Paul  501 

Armitage  v.  Winterbottom  116 

Armour  v.  Transatlantic  F.  Ins. 

Co.  159,  188  A,  372  E 

Armstrong  v.  Mut.  L.  Ins.  Co.  398 

V.  State  Ins.  Co.  126  A 

V.  Toler  246 

V.  Turquand  362,  502,  505 

V.    Western    Manufacturers' 

Mut.  Ins.  Co.  263  E 

Arner  Ins.  Co.  r.  Barnett  452  F 

Arnfeld  v.  Guardian  Ass   Co.  67  G 

Arnet  v.  Milwaukee,  &c.  Ins.  Co.    490, 

491 
Arthur  ;,'.  Homestead  Ins.  Co.  483 

V.  Palatine  Ins.  Co.  294  E 

Arthurholt  v.  Susquehanna  Mut. 

F.  Ins.  Co.  126,  360 

Ashbrook  v.  Phoenix   Mut.   Life 

Ins.  Co.  342  A 

Ashenfelter  v.  Employers'  Liab. 

Ass.  Corp.  "  531  A 

Ashford    v.    Victoria    Mut.    Fire 

Ins.  Co.  131,  132,  243 

Asliland    Mut.    Fire    Ins.    Co.    v. 

Housinger  425 

Ashley  v.  Ashley  398 

xvii 


TABLE   OF  CASES. 
[The  references  are  to  the  sections.] 


Section 

Ashworth  i'.  Builders',  &c.  Ins.  Co.    247 
Aspin wall  I'.  Meyer  549 i 

Associated,  &c.  Ins.  Co.  v.  Assum 

258,  277,  366 
Astor  V.  Union  Ins.  Co.  420  A 

Atcliison,   T.  &  S.  F.   R.  Co.  v. 

Home  Ins.  Co.  453,  457  B 

Atkin  c.  Nat.  Ins.  Co.  190 

Atkins  V.  Sleeper  400,  401 

Atkinson  v.  Hawkeye  Ins.  Co.       54  A 

Atlantic,  &c.  Ins.  Co.  v.  Carlin     124  A 

V.  Concklin  577 

Atlantic  Ins.  Co.  v.  Fitzpatriek        557 

r.  Goodall      67,  366,  400,  55-3,  555 

,;.  Lunar  506  C,  579 

v.  Storrow  454 

V.  Wright  131 

Atlantic   Mut.   Fire  Ins.   Co.   v. 

Sanders  562 

V.  Young  557 

Attleborough    Savings  Bank  v. 

Security  Ins.  Co.  449,  456 

Attorney-General  v.  Continental 

L.  Ins.  Co.   344  F,  356  A,  594  a 

V.  Guardian  L.  Ins.  Co.  594  a 

V.  North   American   Ins.  Co.   331, 

594,  594  a 

V.  Ray  181 

At  wood  V.  Union  Mut.  Ins.  Co.        425 

Audubon  v.  E.xcelsior  Ins.  Co.  2-3 

Augusta  Ins.,  &c.  Co.  v.  Abbott    452  E 

Augusta  Mut.  Ins.  Co.  v.  French      560 

Aultman  v.  Bishop  453 

V.  McConneli  386,  407 

Aurora  Fire  Ins.  Co.  v.  Eddy  131,  199, 

239,  245,  255,  269,  405,  498,  505 

V.  Johnson   374,  411,  466,  475,  590, 

591 

Aurora,  &c.  Ins.  Co.  v.  Kranich  190,  469 

Au  Sable  Lumber  Co.  v.  Detroit 

M.  M.  F.  Ins.  Co.  252 

Austin  V.  Drewe  402,  408,  413 

Avery  v.  Equit.  L.  Ass.  Soc.         566  A 
Aveson  v.  Lord  Kinnaird  214 

Ayer  v.  N.  Eng.  Mut.  Life  Ins.  Co.  .338 
Ayres  v.  Hartford  Ins.  Co.     87  A,  144, 
152,  272,  273,  424,  .505,  508 
V.  Home  Ins.  Co.         131,  143,  272 


B. 


Babcock  v.  Montgomery  County 
Mut.  Ins.  Co.  180,406 

Babson  v.  Thomaston  Mut.  Fire 
Ins.  Co.  80 

Bachnieyer  v.  Mutual  Reserve 
Fund  L.  Ass'n  323 

Bacon  v.  U.  S.  Mut.  Ace.  Ass'n 

517  A,  518  A,  518  B,  523  A,  531  A 

xviii 


Section 

Badenfeld  r.  Mass.  Ace.  Ass'n      531  A 
Badger  v.  Glens  Falls  Ins.  Co.  464,  475 
V.  Phoenix  Ins.  Co.  466,  487 

V.  The  American  Popular  Life 

Ins.  Co.  65,  359 

Baer  v.  Phcenix  Ins.  Co.  365,  372 

Bagg  V.  Jerome  246 

Bagster  v.  Earl  of  Portsmouth  309,  310 

Bahner  y.  Ins.  Co.  364  A 

Baile  v.  St.  Joseph  Ins.  Co.  565 

Bailey  v.  Am.  Cent.  Ins.  Co.  275,  566  A 

V.  Homestead  F.  Ins.  Co.  291 

V.  Interstate  Co.  517  A 

r.  Mut.  Ben.  Ass.  502,  563  A 

y.  N.  E  ,  &c.  Ins.  Co.  392 

Baily  v.  Hope  Ins.  Co.  466,  470 

Bain  v.  Case  428 

Baker  v.  Home  Life  Ins.  Co.  20o 

V.  Citizens'  Mut.  F.  Ins.  Co.  560  B 

V.  Commercial  Union  Ass.  Co. 

70  B,  126 

V.  Cotter  126 

V.  Fireman's  Fimd  Ins.  Co.     452  B 

V.  Ins.  Co.  144  D 

V.  New  York  L.  Ins.  Co.  187 

V.  State  Ins.  Co.      83  a,  2-57,  287  B 

V.  Union  Life  Ins.  Co.   107  /),  341, 

359,  584 

V.  Young  391 

Baldwin  v.  Begley  399  O 

V.  Chouteau  Ins.  Co.  44,  45  a 

V.  German  Ins.  Co.  247 

V.  Hartford  F.  Ins.  Co.  278 

V.  N.  Y.  Life  Ins.  Co.  835,  465 

V.  Phcenix  Ins.  Co.  21,273,  879,457 

V.  State  Ins.  Co.  76  A 

Balen  v.  Hanover  F.  Ins.  Co.  566 

Baiestracci  v.  Firemen's  Ins.  Co.      402 

Haley  v.  Homestead  Ins.  Co.  292 

Ball,  &c.  Wagon  Co.  v.  Aurora  F., 

&c.  Ins.  Co.  360  B,  469 

Ballagh  v.  Royal  Mut.  Fire  Ins. 

Co.  180  a 

Ballou  V.  Gile  390 

Baltimore  Fire  Ins.  Co.  v.  Loney  13, 

428,  434 

v.  McGowan  27,190,281 

Bangs,  Li  re  557 

V.  Bailey  561 

V.  Duckinfield  557,  562 

V.  Gray  557,  559 

V.  Mcintosh  561,  562 

i\  Skidmore  555 

Banliolzer  v.  New  York  L.  Ins.  Co. 

345  E 

Bank  v.  Bank  23  D 

V.  German  American  Ins.  Co.    590 

Bank  of  Columbia  v.  Patterson  16 

Bank  of  New  South  Wales  v.  Royal 

Ins.  Co.  424,  432 


TABLE    OF   CASES. 


[The  references  are  to  the  sections.] 


Section 
Bank  of  Oil  City  v.  Guardian,  &c. 

Ins.  Co.  317,  323,  325,  469 

Bank  of  Toronto  v.  European  Ins. 

Co.  541  a 

Bankers'  Ace.  Ins.  Co.  v.  Rogers         14 
Bankers'  &  M.  Mut.  L.  Ass'n  v. 

Stapp  340 

Bankhead  v.  Des  Moines  Ins.  Co.  263  B 
Banks  v.  Phoenix  Ins.  Co.  345  a 

V.  Wilson  566  A 

Banting  v.  Niagara  Ins.  Co.  476 

Baptist  Church  v.  Brooklyn  Fire 

Ins.  Co.  346 

Baptist   Society   v.  Hillsborough 

Mut.  Fire.  Ins.  Co.  371 

Barber  v.  Fire,  &c.  Ins.  Co.        479,  492 

V.  Fletcher  188  D 

V.  Morris  115 

Barbour  v.  Conn.  Mut.  Life  Ins. 

Co.  459  E 

Barclay  v.  Cousins  79,  80 

Bard  v.  Penn   M.  F.  Ins.  Co.  368 

Bardwell  v.  Conway  Mut.  Fire  Ins. 

Co.  166,  374,  435 

Bargett  v.  Orient  Mut.  Ins.  Co.       177, 

179  D 

Barker  v.  Knickerbocker  591 

Barlow  v.  Ocean  Ins.  Co.  452  F 

V.  Scott  172  A 

V.  St.  Nich.  Nat.  Bk.  292  A 

Barnard  v.  Nat.  F.  In,s.  Co.        239,  287 

Barnes  v.  Continental  Ins.  Co.      360  C 

V.  Fidelity  M.  L.  Ass'n  187 

V.  Hartford  F.  Ins.  Co.  434 

V.  Hekla  F.  Ins.  Co.  12,  566 

i;.  London  &c.  Ass.  Co.  103  A 

V.  Newcomb  594  a 

V.  Piedmont,  &c.  Ins.  Co.       345  C 

V.  Union  Mut.  F.  Ins.  Co.  277, 

279,  280,  448 

Barnum  v.  Merchants'  F.  Ins.  Co.  239  B 

Baron  v.  Bruminer  459  C 

Barr  v.  Ins.  Co.  of  N.  A.  58 

Barralou  xi.  Royal  Ins.  Co.  215  a 

Barre  v.  Council  Bluffs  Ins.  Co.    23, 464 

Barre   Boot  Co.  v.  Milford  Mut. 

Fire  Ins.  Co.  180  a 

Barrett  (;.  Buxton  308 

V.  Jermy  220,  241 

V.  Union  Mut.  Fire  Ins.  Co.        63, 

145,  447,  5H6 

Barrows  v.  March  Ins.  Co.  454 

Barry  v.  Brune  399  P,  399  Q 

V.  Eq.  Life  Ass.  Soc.  391 

V.  Farmers'   Mut.   Hail    Ins. 

Ass'n  79,  547  a 

V.  Hamburg  and  Bremen  F. 

Ins.  Co.  272 

V.  Mut.  Life  Ins.  Co.  391 

V.  Prescott  Ins.  Co.  249  A 


Section 
Barteau  v.  Phoenix  Mut.  Ins.  Co.    206, 

210 
Bartholomew  v.  Merchants'  Ins.  Co.  138 
Bartlett  v.  Fireman's   Fund  Ins. 

Co.  12  A, 133  A, 579 

V.  Iowa  State  Ins.  Co.  449 

V.  Looney  456 

V.  Union  Mut.  Fire  Ins.  Co.      175, 

469  B,  491,  504 

V.  Walter  82 

Barton  v   Home  Ins.  Co.  403 

Basch  V.  Humboldt  F.  and  M.  Ins. 

Co.  359,  469  B 

Bassett  v.  Parsons  594 

Batchelder  i-.  Ins.  Co.  of  N.  A.      165  A 
V.  Queen  Ins.  Co.  145  A 

Batchelor  v.  People's  Ins.  Co.  385 

Bateman  y.  Lumbermen's  Ins.  Co. 

294  E,  368,  434 

Bates  V.  Buckeje  Ins.  Co.  273 

17.  Com.,  &c.  Ins.  Co.  271,365 

V.  Detroit  Mut.  Ben.  Ass.      560  B, 

562,  563  A 

V.  Eq.  Ins.  Co.  282  A,  379 

r.  Grabham  566  A 

V.  Hewitt  207 

Battaille  v.  Merchants'  Ins.  Co.  364  A, 

465,  475 
Battles  V.  York  County  Mut.  Ins. 

Co.  290 

Bauble  v.  iEtna  Ins.  Co.  23,  129 

Bauer  r.  Samson  Lodge  K.  of  P.  563  A 
Baum  V.  Parkhurst  70  a 

Baumgart  v.  Modern  Workmen  187 
Baumgartel  v.  Providence- Wash- 
ington Ins.  Co.  369 
Bawden  v.  London,  &c.  Ass.  Co.  514 
Baxendale  r.  Harvey  219,  231,  256 
Baxter  v.  Brooklyn  L.  Ins.  Co.  356  A 
V.  Chelsea  Mut.  Fire  Ins.  Co.    146, 

504 

V.  Hartford  F.  Ins.  Co.  95  A 

V.  Massasoit  Ins.  Co.  23 

Bayles  v.  Ins.  Co.  385,  393 

Baylies  v.  Payson  568 

Bayiiss  v.  Travellers'  Ins.  Co.        515  a 

Bayly  v.  Lancashire,  &c.  Ins.  Co.     583 

('.  London,  &c.  Ins.  Co.  242 

Bayse  v.  Adams  398,  399  L 

Bay  State  Mut.  Fire  Ins.  Co.  v. 

Sawyer  562 

Beach  v.  Bowery  Ins.  Co.  448 

Beacon,  &c.  Ins.  Co.  v.  Gibb  243 

Beadle  v.  Chenango  Co.  Mut.  Ins. 

Co.  156 

Beakes  r.  Phoenix  Ins.  Co.  406 

Beal  V.  Park  Ins.  Co.  132,  14.3,  144 

Beals  V.  Home  Ins.  Co.      423,  432,  483 
Bean,  In  re  391 

V.  At.  &  St.  Law.  R.  R.  Co.       453 

xix 


TABLE   OF   CASES. 


Section 

Bean  r.  Barney  &  Scott  ^«6 

V.  Stupart  1=^^ 

Beatty  r.  Lycoming  County  Mut 

Ins.  Co.      401  a,  420,  402,  464,  469  a 

475,  o08 

Beaty  v.  Downing  H^ 

Bebee  v.  Hartford  Mut.  Fire  Ins. 

Co.  144,  208,  209 

Beck  V.  Gerniania  Ins.  Co.  477 

V.  Hibernia  Ins.  Co.  2U6 

Becker  v.  Farmers'  Mut.  F.  Ins. 

Co.  249  B,  249  G 

Beebe  /•.  Oliio  Farmers'  Ins.  Co.  2y4  E 
Buemer  v.  Anchor  Ins.  Co.  446 

Beer  i.:  Forest  City  Mut.  Ins.  Co.     2o3 
Beers  v.  New  York  L.  Ins.  Co.  303 

Begler  f.  Ins.  Co.  365  B 

Beliler  v.  German,  &c.  Ins.  Co.        176, 
245,  .360,  365,  368,  577 
Belirens  ;-•.  Germania  F.  Ins.  Co. 

365  C,  373  A 


[The  references  are  to  the  sections.] 

Section 

Benninghofiff.  Agr.  Ins.  Co.        138  A, 

282  A,  294  E 

Benson  v.  Ottawa  Agr.  Ins.  Co.       129, 

140,  143,  207,  507 

Bentley  r.  Columbia  Ins.  Co.     125,  137 

V.  Lumbermen's  Ins.  Co.        239  A 

V.  Standard  F.  Ins.  Co.      379,  386, 

465 

Benton  v.  Farmers'  Mut.  F.  Ins. 

Co.  222,  401  a 

Bentz  V.  Northwestern  Aid  Ass.  563  A 
Bergeron  v.  Pamlico  Ins.  Co.  151 

Bergman  v.  St.  L  Ins.  Co.  502 

Berg.-on  v.  Builders'  Ins.  Co.      67,  584 
Berkshire   Mut.  Life  Ins.  Co.  v. 

Sturgis  575 

Berliner  v.  Travelers'  Ins.  Co.    306,  360 


Beisecker  v.  iEtna 

Ins.  Co. 

442 

Belcher  v.  International,  &c 

Ins 

Co. 

572 

Bell  V.  Bell 

215  C 

1-.  Chapman 

39 

V.  Gilson 

37 

V.  Shibley 

549 

V.  Western  M. 

andF.  Ins.Co. 

452  I-: 

V.  Yates 

549 

Bell's  Case 

694  a 

Bellatly  v.  Thomaston  M.  F 

.  Ins 

Co. 

587  B 

Belleville  Mut.   Ins.  Co.  v. 

Van 

Winkle 

6 

3,  134,  146 

Bellevue  Roller-Mill  Co.  v. 

Lon- 

don  &  L.  F.  Ins. 

Co. 

253, 

276  C 

Bellington  v.  Can.  Mut.  Fire  Ins. 

Co.  277 

Benard  v.  United  Workmen  399  D 

Ben  Franklin  Ins.  Co.  v.  Flynn       462, 

466,  469  B,  504  A 


V.  Gillett 

143 

Benedict  v.  Ocean  Ins.  Co. 

239, 

.371 

Benefit  L.  Ins  Co.  v.  Martin 

336 

Benham   v.  United   Guaranty  & 

Life  Ins.  Co. 

191, 

542 

Benjamin  v.  Conn.  Ind.  Ass'n 

186 

V.  Saratoga  County  Mut. 

[ns. 

Co. 

368, 

457 

Bennecke  v.  Ins.  Co. 

339 

Bennett  i:  Agr.  Ins.  Co.        156,  249  B, 

2491 

I'.  Anderson 

185 

197 

V.  City  Ins.  Co. 

67 

f.  Council  Bluffs  Ins.  Co. 

132 

V.  Lycoming  Ins.  Co. 

462 

469 

V.  Md.  Ins.  Co. 

469 

V.  N.  Brit.,  &c.  Ins.  Co. 

143, 

166, 
497 

Bermon  v.  Woodbridge  567 

Bernard    v.     United     Life     Ins. 

Ass'n  500 

Berners  v.  South  British,  &c.  Ins. 

Co.  463 

Berry  v.  American  Central   Ins. 

Co.  95A,  151,  448 

Berscli  i'.  Sinnissippi  Ins.  Co.    553,  557 
Bersche  c.  Globe  Mut.  Ins.  Co.         504 
V.  St.  Louis  Ins.  Co.  292  B 

Berthold  v.  Clay  F.  &  M.  Ins.  Co.  399  D 
Berthon  v.  Loughman  200 

Berthoud  v.  Atlantic  Fire  Ins.  Co.     56 
Betcher  v.   Capital  F.  Ins.  Co.      233, 

469  C 
Beutz  i;.  N.  W.  Aid  Ass.  419a 

Bevin  v.  Conn.  Mut.  Life  Ins.  Co.       7, 
109,  336,  339,  362,  502 
Bibend  v.  Liverpool,  &c.  Ins.  Co.     386 
Bickerton  v.  Jaques  399  O,  399  P 

Bicknell  v.  Lancaster  Fire  Ins.  Co.  83  a 
Biddeford  Sav.  Bk.  ;;.  Dwelling- 

House  Ins.  Co.  460  B 

Bidwell  r.  Astor  Mut.  Ins.  Co.  566 

V.  N.  W.  Ins.  Co.  294  D 

V.  St.  Louis   Floating  Dock 

Ins.  Co.  56,  384 

Bigelow  V.  Berkshire  Life  Ins.  Co. 

309,  317,  322 


V.  State,  &c.  Ins.  Co. 
Biggert  r.  Hicks 
Bitrgs  V.  Ins.  Co. 
Bigler  v.  N.  Y.  Central  Mut. 

Co. 
Bilbie  v.  Lumley 
Bilbrough  v.  Mut.  Ins.  Co. 


341 

2 

279 

Ins. 

365,  420 

575 

192,  248, 

466,  474 

322 

379,  456 


Billings  V.  Accident  Ins.  Co. 
V.  German  Ins.  Co. 
V.  Toland  County  Mut.  Ins. 

Co.  164,  191,  241,  247 

Billington  v.  Provincial  Ins.  Co.      145, 

145  a,  566 


XX 


TABLE   OF   CASES. 


[The  references  are  to  the  sections.] 


Section 

Bird  V.  Penn.  Mut.  Ins.  Co.   345  a,  350, 

350  a 
Birdseye  v.  City  Fire  Ins.  Co.  379 

Birmingham  r.  Empire  Ins.  Co.        287 
V.  Farmers'  Joint  Stock  Ins. 

Co.  465 

Birmingham  Ins.  Co.  v.  Kroegher 

li4F,  233 

V.  Palmer  494 

V.  Pulver     423  <i,  409  B,  469  C,  493 

Bish  V.  Hawkeye  Ins.  Co.  488 

Bishop  V.  Agr."  Ins.  Co.  405 

V.  Clay  Ins.  Co.  209  a,  506 

V.  Eaton  P-^O 

V.  Empire  Order  of  Mut.  Aid  503  a 

V.  Michigan  Soutliern  K.  ll.     23  I) 

Bisliop  of  C.  L\  Western  Ass.  Co.   43  F 

Bissell  I'.  Am.  Fire  &  Life  Ins.  Co.  P37, 

216,  302 

Bize  V.  Fletcher  158 

Black  V.  Cohnnbian  Ins.  Co.  505 

V.  Nat.  Ins.  Co.  379,  .382,  452  C,  456 

V.  Winnisheik  Ins.  Co.  488 

Blackburn  v.  Haslam  122 

V.  St.  Paul  F.  &  M.  Ins.  Co.      _  83 

Blackerby  i'.  Continental  Ins.  Co.  345  II, 

348  « 
Blackett  v.  Royal  Ex.  Ins.  Co.         175, 

420  a 

Blackhurst  v.  Cockrell  172  a 

Blackstone  v.  Alemania  Ins.  Co.         11 

Blackwell  v.  Ins.  Co.  279 

Blaesor  v.  Milwaukie,  &c.  Ins.  Co.  583 

Blair  v.  Sovereign  F.  Ins.  Co.  479 

Blake  v.  Crowninshield  400 

V.  Excliange  IMut.  Ins.  Co.  145, 11)7, 

371,  420,  435,  470,  473,  501, 505 

V.  Ins.  Co.  48 

V.  National  L.  Ins.  Co.  344  a 

Blake  Opera  House  v.  Home  Ins. 

Co.  560 

Bhikeley  r.  Plioenix  Ins.  Co.  405 

Bhikiston  v.  Ins.  Co.  301 

Blanchard  v.   Atlantic  Mut.  Fire 

Ins.  Co.  447,  555 

Blanks  v.  Ins.  Co.  485 

Blattenberger  v.  Holman  591 

Bleakley  v.  Niagara   Dist.    Mut. 

Fire  Ins.  Co.  137,  140,  277 

Blinn  r.  Dresden  Mut.  Fire  Ins. 

Co.  452  F 

Bliss  V.  JFAna,  L.  Ins.  Co.  391  a 

Block  V.  Columbian  Ins.  Co.  502 

V.  Valley  Mut.  Ins.  Ass'n  379 

Blood  V.  Howard  Ins.  Co.  104, 170,  191, 

247 
Bloom  V.  Franklin  L.  Ins.  Co.       327  a 
V.  State  Ins.  Co.  345  E 

Blooming  Grove  Mut.  F.  Ins.  Co. 

V.  McAnerney  294  E 


Section 
Bloomingdale  v.  Lisburger  391a 

Bloomington  Mut.   Ben.   Ass.   v. 

Blue  75B,  399E 

Blossom  V.  Lycoming  Ins.  Co.  471 

Blouin  V.  Phaneuf  399  J 

Blumer  v.  PhaMiix  Ins.  Co.  185, 190,  250 
Board  of  Education  v.  Citizens' 

Ins.  Co.  543  a 

Boardman  v.  Maverick  Mut.  Fire 

Ins.  Co.  191 

V.  Merrimack,  &c.  Ins.  Co.  246 

V.  N.  H.  Mut.  Fire  Ins.  Co.       159, 

104,  191,  247,  256 

Boatman's  F.  &  M.  Ins.   Co.  v. 

Parker  415 

Boatwright  v.  .Etna  Ins.  Co.  218,  220 
Bobbitt  V.  Liverpool,  &c.  Ins.  Co.  29  a, 
158,  188  C,  373,  374,  424,  448 
Bodine  v.  Exchange  Fire  Ins.  Co.  126, 
134, 154,  .340,  346,  360,  300  a 
Bodle  et  al.  v.  Chenango  Mut.  Ins. 

Co.  278,  281,  448,  468 

Body  V.  Hartford  F.  Ins.  Co.  67  G,  591 
Boehen  v.  Williamsburgh  Ins.  Co.    143, 
151,  360 
Boelnu  v.  Combe  34 

Boetcher  v.  Hawkeye  Ins.  Co.  294  E 
Bogardus  v.  N.  Y.  Life  Ins.  Co.  344  I) 
Boggs  V.  Am.  Ins.  Co.       144,  192,  207, 

215  a 
Bohn  Manuf.  Co.  r.  Sawyer  96 

Bohninger  u.  Empire  Mut.  L.  Ins. 

Co.  133  C 

Boice  V.  Thames,  &c.  Mar.  Ins.  Co.      27 

Boland  v.  Industrial  B.  Ass'u  298 

V.  Whitman  554,  567 

Bole  V.  New   Hampshire  F.  Ins. 

Co.  70«,248 

Bolland  v.  Disney  326 

Bon  V.  Bailway  Pass.  Ass.  Co.  524  a 
Bond  I'.  Gonsales  179  a 

Bonenfant  v.  Ins.  Co.      170,  245,  247, 
249«,  282  A,  386,  502 
Bonham  v.  Iowa,  &c.  Ins.  Co.  285,  287, 
373,  374 
Bonner  v.  Home  Ins.  Co.  466 

Bonneville  v.  Western  Ass.  Co.  372  D 
Boos  V.  World  Mut.  Life  Ins.  Co.  131, 
144  G,  296 
Boot  &  Shoe,  &c.  Ins.  Co.  v.  Mel- 
rose 553 
Borden  i'.  Hingham  Mut.  Fire  Ins. 

Co.  7,  30,  425 

V.  Provincial  Ins.  Co.  475 

Boren  v.  Manhattan  L.  Ins.  Co.         151 

Borgards  v.  Farmers'  Mut.  Ins.  Co.  5-57 

Boriglit  V.  Springfield  F.  &  M.  Ins. 

Co.  175 

Borradaile  v.  Hunter  157,  308,  309.  310, 

311,  313,  316,  320,  323,  326 


XXI 


TABLE    OF   CASES. 


[The  references  are  to  the  sections.] 


Section 
Boston  Ins.  Co.  v.  Globe  F.  Ins.  Co.  11 
Boston  &  Salem  Ice  Co.  v.  lioynl 

Ins.  Co.  207,  268,  424 

Bosworth  V.  Merchants'  h\  Ins. 

Co.  294  E 

V.  Western  Mut.  Aid  Soc.       5(31  a 

Bottomley  v.  Met'n  L.  Ins.  Co.  21.  06  A, 

70  C 
Bound  Brook  Mut.  F.  Ins.  Ass.  v. 

Nelson  379,  457 

Bourgeois  V.  Mut.  F.  Ins.  Co.  369 

r.  Northwestern  Nat.  Ins.  Co. 

263  E,  369 
Bourne  v.  Gatliff  579 

Boussniaker,  Ex  parte  37 

Boutelle  »•.  Westchester  F.   Ins. 

Co.  287  C,  373  a 

Bouton  V.  Am.  Mut.  Life  Ins.  Co.    134, 
349  B,  360 
Bowditch  Mut.  Fire  Ins.  Co.  v. 

Winslow  215,  287,  562 

Bowcn  V.  National  L.  Ass'n      379,  465 

V.  Needles  Nat.  Bank  591  A 

Bowes  V.  Nat.  Ins.  Co.        268  B,  473  a 

478,493  a,  511,  579 

Bowlin  V.  Hekla  F.  Ins.  Co.  465 

Bowman  v.  Agr.  Ins.  Co.        358,  401  a 

V.  Franklin  Fire  Ins.  Co.     189,  291 

V.  Pacific  Ins.  Co.  219,  212 

V.  U.  S.  Casualty  Ins.  Co.  154 

Bowser  v.  Lamb  66,  577 

Bo.x  V.  Provincial  Ins.  Co.  83  a 

Boyce  v.  Phoenix  Mut.  Ins.  Co.         299 

Boyd  f.  Cedar  Rapids  Ins.  Co.     459  C 

V.  Dubois  207 

V.  Ins.  Co.  231 

V.  Mississippi  Home  Ins.  Co.     239 

V.  Talbot  347 

Boyden  v.  Mass.  Mut.  L.  Ins.  Co.  459  E 

Boyle   V.    Hamburg-Bremen   F. 

Ins.  Co.  430,  465 

V.  N.  Carolina  Mut.  Ins.  Co.      147, 

471 

V.  Northwestern  Mut.  Relief 

Ass'n  187 

Boynton  v.  Clinton  &  Essex  Mut. 

Ins.  Co.     222,  276,  277,  401  a , 
553 
V.  Farmers'  Mut.  Ins.  Co.  387 

Boynton  et  al.  v.  Middlesex  Mut. 

Life  Ins.  Co.  491 

Bradbury  v.  Ins.  Co.  401  B 

liraden  v.  La.  St.  Ins.  Co.  448 

Hradfield  v.  Union,  &c.  Ins.  Co.        552 
Bradford  v.  Boylston  F.  &  M.  Ins. 

Co-  579 

V.  Greenwich  Ins.  Co.  4,=S7 

Bradley  v.  xMut.  Ben.  Life  Ins.  Co.  316, 

329,  331 

V.  Piicenix  Ins.  Co.  479 

xxii 


Section 
Bradley  v.  Potomac  Fire  Ins.  Co.     55, 

340 
Bradshaw  v.  Agricultural  Ins.  Co.    492 
Bradwell  v.  American  Life  Ins.  Co.  358 
V.  Weeks  42  a 

Bradj-en  v.  Manuf.,  &c.  Ins.  Co.        285 
Bradgon   v.  Appleton   Mut.   Ins. 

Co.  55  A,  62,  360 

Brady  v.  Northwestern  Ins.  Co.     70  a, 

190,  404,  433 

V.  Prudential  Ins.  Co.  478 

V.  United  L.  Ins.  Co.  158,  303 

V.  Western  Ass.  Co.  151,  488,  505 

Bragg  V.  N.  E.  Mut.  Fire  Ins.  Co.   269  a, 

275,  276 

Brandaf  v.  St.  Paul,  Fire  &  Mar. 

Ins.  Co.  143 

Brandon  v.  Curling  36,  39 

Brandup  «.  St.  Paul,  &c.  Ins.  Co.     372 
Brannin  v.  Mercer  Count}-  Mut. 

Ins.  Co.  562 

Braswell  v.  American  Ins.  Co.  567 

Braunstein  v.  Ace.  Death  Ins.  Co.  465, 

493 
Brealey  v.  Collins  295 

Breasted     v.     Farmers'   Loan    & 

Trust  Co.  ,308,  310,  313,  316 

Breckenridge  v.  Amer.  Cent.  Ins. 

Co.  126,  133  A,  378  A,  393,  469  B,  579 
Breed  love  v.  Norwich    Union   F. 

Ins.  Co.  276  C.  294  E 

Breitung's  Estate,  66, 112,  399  O 

Brennan  v.  Crouch  279 

V.  Prudential  Ins.  Co.  75  B 

V.  Security,  &c.  Co.  158 

Breuner  v.  Liverpool,  &c.  Ins.  Co.  221, 

412 
Brewer  v.  Chelsea  Mut.  Fire  Ins. 

Co.  127,  146 

V.  Herbert  83  a,  86 

Brewster  v.  Kitchin  850 

Brichta  v.  N.  Y.  Lafayette  Ins.  Co.  380, 

424 
Brick  V.  Campbell  269,  399  Q,  459  B 
Bridge  r.  Niagara  Ins.  Co.  .  420  a 

Bridgewater   Iron  Co.   v.  Enter- 
prise Ins.  Co.  372  E 
Bridgman  v  London  Life  Ass.  Co.    186 
Brierly  r.  Equitable  Aid  Union  2 
Briggs  v.  Fireman's  Ins.  Co.          144  E 
V.  McCullough                          344  D 
V.  Nat.  Life  Ins.  Co.                    358 
V.  N.  A.  Ins.  Co.                        416  a 
z>.  N.  Brit.,  &c.  Ins.  Co.             416  a 
Brigham  r.  Home  Ins.  Co.                 390 
V.  Wood                                         279 
Brighton    Manufacturing   Co.   v. 

Reading  Fire  Ins.  Co.  248 

Brink  v.  Hanover  Fire  Ins.  Co.     469  a 

507 


TABLE    OF    CASES. 


[The  references  are  to  the  sections.] 


Brink  v.  Merchants'  &  Mechanics' 

Ins.  Co.  175 

Brinley  v.  Nat.  Ins.  Co.      423,  425,  431 
Brinsley  v.  City  Fire  Ins.  Co.  264 

Brisso  V.  Pacific  Mut.  Ins.  Co.       566  A 
British  America  Ass.  Co.  v.  Bradford  30 
V.  Cooper  67  G,  125 

V.  Miller  420 

British  American  Ins.  Co.  v.  Jo- 
seph 401  a,  413 
British  &  American  Tel.  Co.   v. 

Colson  48 

Britisli  Equitable  Ins.  Co.  v.  Great 

Western  Ins.  Co.  190,  388,  578 

British  Ins.  Co.  v.  Gulf,  &c.  R.  Co.  457  B 

V.  Jenkins  594 

V.  Lambert  67,  125 

V.  Magee  115 

Britt  V.  Mutual  Benefit  Life  Ins. 

Co.  579 

Britton  v.  Royal  Arcanum  399  D 

V.  Royal  Ins.  Co.  591 

Broadhead  v.  Lycoming  Fire  Ins. 

Co.  143 

Broadwater  r.  Lyon  Fire  Ins.  Co.  67  G, 

294  D 
Brock    V.    Dwelling-House    Ins. 

Co.  492,  497 

Brockelbank  v.  Sugrue  129,  139 

Brockhaus  v.  Kemna  390,  399  P 

Brockway  v.  Mut.   Ben.   L.  Ins. 

Co  296,  419  A 

Brooklyn  v.  Brooklyn  Fire  Ins.  Co.     21 
Brooklyn  Masonic  Relief  Ass.  v. 

Hanson  399  N 

Brooks  V.  Phoenix  Mut.  Life  Ins. 

Co.  390 

V.  Standard  Fire  Ins.  Co.  252 

Brossard  v.  Massouin  390,  451 

Brough  V.  Higgins  433  A 

V.  Whitmore  26 

Brouwer  I'.  Appleby  549  6,552 

V.  Hill  549  b,  594 

Brown  i-.  Am.  Cent.  Ins.  Co.  54  A 

V.  Bigelow  497 

V.  Cattaraugus    County    Mut. 

Fire  Ins.  Co.  371 

f.  Commercial  Fire  Ins.  Co.  144  A, 

287  B 

V.  Commonwealth  Ins.  Co.         291 

V.  Cotton  &  Woolen  Mfrs.  Mut. 

Ins.  Co.  Ill,  267,  276  A,  276  C, 
459  E 
V.  Crook  549 

V.  Donnell  552 

V.  Equitable  Ass.  Society  379 

V.  Franklin  Mutual   Fire   Ins. 

Co.  14,  126,  557 

V.  Gore  District  Mut.  Ins.  Co.    287 
V.  Greenfield  L.  Ass'n  298,  303,  398 


Section 
Brown  v.  Hartford  Fire  Ins.  Co.      460 
V.  Hartford  Ins.  Co.  379,  478 

V.  King's    County    Mut.    Ins. 

Co.  402 

V.  London  Ass.  Corp.  462,  465 

V.  Mass.  Mut.  Life  Ins.  Co.  360  F 
V.  Met'n  Lite  Ins.  Co.  144  E,  295 
V.  Palatine  Ins.  Co.  263  A 

V.  People's  Mut.  Ins.  Co.  277 

t'.  Price  399  B 

V.  QuincyMut.Firelns.Co.  31,425 
V.  Railway  Passenger  Ins.  Co.  70, 
155,  428,  429,  526,  530 
V.  Roger  Williams  Ins.  Co.  379, 
384,  478,  483 
V.  Royal  Ins.  Co.  432,  433 

V.  St.  Nichol's  Ins.  Co.  414,  417 
V.  Savage  396 

V.  Savannah  Mut.  Ins.  Co.  478,  482 
V.  Springfield  Fire  &  j\lar.  Ins. 

Co.  267 

V.  State  Ins.  Co.  138,  263  A 

V.  Sun  L.  Ins.  Co.  325 

V.  U.  S.  Casualty  Co.  12 

V.  Williams  287 

Brown's  Appeal  399  Q 

Browne  v.  Clay  Ins.  Co.  465 

Browne  Nat.  Bank  v.  Southern  Ins. 

Co.  274 

Browning  v.  Home  Ins.  Co.   247,  249  B 

V.  Morris  567 

Bruce  v.  Gardner  114,  449,  456 

V.  Gore  District  Mut.  Ins.  Co.     67, 

365 
V.  Life  Ins.  Co.  344  E 

Brude  v.  ^tna  Ins.  Co.  379 

Brueck  v.  Plioeni.x  Ins.  Co.  190 

Brugger  v.  State,  &c.  Ins.  Co.       93  A, 
420,  424,  566 
Brugurt  v.  La.   St.   Mar.    &   Fire 

Ins.  Co.  591 

Brummer  v.  Cohn  391,  .399  Q 

Brunswick  v.  Com.  Ins.  Co.    269a,  379 
Bruton  v.  Met.  Life  Ins.  Co.  400 

Bryan  v.  National  L.  Ins.  Ass'n        360 
V.  Traders'  Ins.  Co.  272 

Bryant  v.  Ocean  Ins.  Co.  188  D 

V.  Poughkeepsie  Mut.  Ins.  Co.  239 
Bryce  v.  Lorillard  Ins.  Co.     257,  401  a, 

566 

Buchanan  v.  Curry        39,  40,  42 

V.  Exchange  Ins.  Co.    231  242, 

383,  420 

V.  Ocean  Ins.  Co.  76  A 

V.  Westchester  Ins.  Co.  574 

Buck  V.  Chesapeake  Ins.  Co.   74,  94  A, 

179  A 

V.  Colbath  390 

Buckbee  v.  U.  S.  Ins.  &  Trust  Co.    361 

Buckley  v.  Garratt  et  al.    280,  382,  502 

xxiii 


TABLE   OF   CASES. 


Section 
549 

.  16b 
208 


465 


Buckman  v.  Metcalf 

liuell  «'.  Conn.  Mut.  Life  Ins.  Oo. 

Unit-  r.  Turner 

BulYalo  Loan  Co.  v.  Knight  lemp- 

l:irs'  Mut.  Aid  Ass'n 
Buffalo   Steam    Lngine   Wor'<s  i;. 

Sun  Mut.  Ins.  Co.  ^'A  279,  379 

Buffum  c.  Bowditcli  Mut.  Ins.  Co.   ^»o 

V.  Fayette  Mut.  Fire  Ins.  Co.     bo, 

Buick  V.  Meclianics'  Ins.  Co.  67  G,  r25 
Bulger  V.  Wash.  Life  Ins.  Co.        So'Z  A 
Bulkley  v.  The  Derby  Fishing  Co^   15 
r.  Protection  Ins.  Co.  179  A 

Bull  0.  North  British  Can.  Invest. 

Co.  &  Imp.  Fire  Ins.  Co.  452  B 

Bulhnan  v.  North  Britisli  &  Merc. 

I„s.  c;o.  379,  492,  590 

Bunnners  v.  U.  S   Ins.  Co.  579  B 

Bumstead  v.  Dividend   Mut.   Ins. 

Co  465,  475,  504 

Bunce  v.  Beck  24  A 

Bunker  v.  Green  2^ 

V.  Shed  47» 

Bunten  v.  Orient  Mut.  Ins.  Co.      43  E, 

130  A 
Burbank  v.  Rockingham  Mut.  Fire 

Ins.  Co.  264,  266,  366 

Burcliell  v.  Marsh  492 

Burdon  v.  Mass.  Safety  Fund  Ass.   o.j8, 

552 
Burgess  v.  Alliance  Ins.  Co.      420,  428 
V.  Eo.  Mar.  Ins.  Co.  222 

Burgher  'v.  Columbian  Ins.  Co.     447  A 
Burke  v.  Prudential  Ins.  Co. 
Burkhard  v.  Travelers'  Ins.  Co 


[The  references  are  to  the  sections.] 

Section 
Burritt  v.  Saratoga  County  Mut. 

Fire  Ins.  Co.  159,207,258 

Burroughs  v.  State  Mut.  Life  Ins. 

Co.  391,  393 

Burrus  v.  Va.  L.  Ins.  Co.  67 

Bursinger  v.  Bank  of  Watertown 

Burson  r.  Pliila.  Fire  Ass'n  21 

Burt  V.  People's  Mut.  Ins.  Co.  365,  371 
Burton  v.  Buckeye  Ins.  Co.  483 

V.  Conn.  Mut.  Life  Ins.  Co.    103  A 
V.  Farmholt  459  E 

Busby  V.  N.  A.,  &c.  Ins.  Co.     346,  3G2 
Busch  V.  Ins.  Co.  471 

Bush  V.  Westchester  Fire  Ins.  Co.  129, 

11)8 

Bushnell  v.  Bushnell 
Bussell  V.  Am.  Fire  Ins.  Co. 
Bussing  V.  Union,  &c.  Ins.  Co. 
Butler  V.  Am.  Pop.  Ins.  Co. 
V.  Merch.  M.  Ins.  Co. 
V.  Standard  Eire  Ins.  Co.    82,  100, 
180  a,  243,  401  a 
Butman  v.  Ilobbs  f>83 

Butternut  Manuf.  Co.  v.  Manufac- 
turers' M.  F.  Ins.  Co.  247 
Butterworth  v.  Western  Ass.  Co. 

469  B 

Button  V.  Am.  M.  A.  Ass'n  517  A 

Butz  V.  Farmers'  Ins.  Co.  282  B 

Bvers  v.  Farmers'  Ins.  Co.     29  A,  181, 

•^  188  A,  269,  290 


398  A 
140 

344  a 

345  a 
365  C 


Byrne  v.  Rising  Sun  Ins.  Co. 


504 


112 

175, 

531  A 

Burkheiser  v.  Mutual  Ace.  Ass'n  517  A 

Burland  v.  Mut.  Ben.  Ass.  563  A 

Burleigh  v.  Gebhard  Fire  Ins.  Co.    156 

Burlingame  v.  Goodspeed  83 

Burlington  Ins.  Co.  v.  Brockvvay      247 

V.  Campbell  401  a 

V.  Kennerly  126,  465 

V.  Lowerv  248,  462,  465 

V.  Threlkeld  151,401a 

Burmood  v.  Farmers'  Union  Ins. 

Co.  557 

Rurnam  v.  White  379 

Burnand  v.  Rodocanachi  456a 

Burner   v.  German-Am.   Ins.    Co. 

247,  345  E 
Burnett  v.  Eufala  Home  Ins.  Co.  279 
Burnham    v.   Interstate    Casualty 

Co.  325,  465 

V.  Royal  Ins.  Co.  247 

Burr  V.  Broad wav  Ins.  Co.  420 

r.  German  Ins.  Co.  189,  291  A 

V.  Sim  465 

Burridge  v.  Raw  452  A 

xxiv 


Caballero  v.  Home  Mut.  Ins.  Co.  414 
Cady  V.  Imi)erial  Ins.  Co.  263  B 

Caffrey  v.  John  Hancock  Mut.  Life 

Ins.  Co.  360  G 

Cahen  v.  Continental  Life  Ins.  Co.  11 
Cain  I'.  Lancashire  Ins.  Co.  67 

Caldwell   v.    Stadacona  Fire  and 

Life  Ins.  Co.  273, 424  A 

Caledonian  F.  Ins.  Co.  v.'Traub  492 
Calhoun  v.  Union  M.  Ins.  Co.  360  C 
California  Ins.  Co.  v.  Gracey  488 

V.  Union  Compress  Co.    95  A,  240, 
402 
California  State  Bk.  v.  Hamburg 

276  A 
Calvert  v.  Hamilton  Mut.  Ins.  Co.  190 
Camden   C.  Oil  Co.  v.   Ohio  Ins. 

Co.  154  A 

Cameron  v.  Can.  Fire  &  Mar.  Ins. 

Co.  462 

V.  Fay  459  D 

Cammack  v.  Lewis  75  B,  107,  398 

Campbell  v.  Adams  555,  559 


TABLE    OF   CASES. 
[The  references  are  to  the  sections.] 


Campbell  v.  ^tna  Ins.  Co. 
V.  Allan 

V.  Am.  Fire  Ins.  Co. 
V.  Am.  Pop.  Life  Ins.  Co. 
V.  Charter  Oak  Fire  Ins.  Co 


Section 
365 
667 
54  A 
589 
216, 
477 
185, 


V.  Hamilton  Mut.  Ins.  Co. 

274,  291 
V.  Intern.  Life  Ass.  Soc.     131,  134, 

349 

V.  Leonard  286 

V.  Merchants'  &  Farmers'  Mut. 

Fire  Ins.  Co.        142,  143,  166, 

180  a 

V.  Monmouth   Mut.  Fire    Ins. 

Co.  410 

V.  N.  E.  Mut.  Life  Ins.  Co.      75  B 

112,   156,  158,  159,    164,    165 

181,    183,  185,  187,    192,    195^ 

205,  298,  589 

V.  Rickards  580 

V.  Victoria  Mut.  Ins.  Co.  208 

Canada  v.  Liverpool  &  Lond.  Fire 

Ins    Co.  221 

Canada  Landed  Credit  Co.  r.  Can- 
ada A^iF.  Ins.  Co.  21G,  221,  365 
Canada  .Mut.  Fire  Ins.  Co  v.  North- 
ern Ins.  Co.  9,  12,  197 
Candee  v.  Citizens'  Ins.  Co.      180,' 192, 

'  -^^(^ 
Cann  v.  Imp.  Fire  Ins.  Co.   373,  373  A 


464,  477 

247 

43  G 

m,  504  A 

402 


Cannel  v.  Phoenix  Ins.  Co. 
Canning  v.  Farquhar 
Cannon  v.  Home  Ins.  Co. 

V.  Phoenix  Ins.  Co. 
Canterbury  v.  Atty.-Gen.  454 

Canton  Ins.  Office^-.  Woodside         175 
Canton  Masonic  Mut.  Ben.  Soc.  v. 

Rockhold  552 

Capital  City  Ins.  Co.  v.  Autrey   291  A 
Capital    Ins.    Co.    v.    Pleasanton 

Bank  294  E 

Capitol  Ins.  Co.  v.  Bank  of  Blue 

Mound  557 

I'.  Wallace  462,  494 

Caplis  (.-.  American  F.  Ins.  Co.   27o',  379 

Carberry  v.  German  Ins.  Co.    449,  .J89 

Cardinal  v.  Dominion  Ins.  Co.  248 

Carey  r.  Allemania  F.  Ins.  Co.  269,  4()5 

V.  Farmers'  Ins.  Co.  462 

v.  German-American  Ins.  Co.  189, 

274,  291  A,  369 

V.  Liverpool,  &c.  Ins.  Co.  269, 

287  B 

V.  Phoenix  Ins.  Co.  279,  291  A 

r.  London  Prov.  Fire  Ins.  Co.  424  o 

Cargill  v.  Miller's,    &c.    Mut.   Ins. 

^  Co.  175_  420  B 

Carleton  v.  China  Mut.  Ins.  Co.       434 


Section 
Carlin  v.  West.  Ass.  Co.  239  a 

Carlock  v.  Phoenix  Ins.  Co.  345  E 

Carlwitz  v.  Gemiania  Fire  Ins.  Co. 

345  B,  423  B,  424  a,  583 
Carmeli  v.  Beaver,  &c.  Ins.  Co.         465 
Carmichael   v.   N.  W.    Mut.    Ben. 
^  ^'-^s.  399  F 

t  a  mil  en  v.  Cornell  557 

Carnes  v.  Iowa  State  T.  M.  Ass'n    325, 
^  515  a 

(  arney  v.  New  YorkL.  Ins.  Co.       303 
Carpenter   v.  AUemannia  F.   Ins. 

Co.  222, 420 

V.  American  Ins.  Co.  122,  373 

V.  Centennial  Mut.  Ins.  Co.  '  .352 
V.  Continental  Ins.  Co.  355,  502 
V.  German  Amer.  Ins.  Co.     294  E, 

466 

V.  Mut.  Saf.  Ins.  Co.  566  C 

V.  Prov.  Wash.  Ins.  Co.     6,  12,  72 

80,  284,  365,  365  B,  369  373* 

378,  381  a,  391,  424,  456 

V.  Snelling  25 

V.  U.  S.  L.  Ins.  Co.  112 

Carpenter's  Estate  407 

Carr  r.  Fire  Ass.  Ass'n  294  b 

V.  Hamilton  594  a,  595,  596 

V.  London  &  N.  W.  R.  R.  Co.     497 

V.  Mass   Benefit  Ass.  29  C 

V.  Un.  Mut.  Fire  Ins.  Co.         594  a 

Carraway  v.  Merchants'  Mut.  Ins. 

n  ^°:  .  478 

Carrigan  v.  Ins.  Co.  71,  233,  287  C 

Carrington   i-.   Com.  Fire  &  Mar 
„  ^"s-,  Co-  12,  594  a 

Carroll  v.  Boston  Mar.  Ins.  Co.         101 

V.  Charter  Oak  Ins.  Co.     126  151 
372,  .386,  501,  502,  511 

V.  Girard  Fire  Ins.  Co.   473  a,  493, 

511 

V.  Home  Ins.  Co.  405 

V.  New  Orleans,  &c.  R.  R.       457  a 
Carrugi  v.  Atlantic,  &c.  Ins.  Co.     371, 

r,  ,  372  a 

Carruthers  r.  Gray  407  a 

V.  Shedden  gl 

Carson  v.  Jersey  City  Ins.  Co.  29  a,  1 70, 

501,  511 

V.  JIar.  Ins.  Co.  30 

Carstairs   v.  Mechanics',  &c.  Ins. 

^  Co.  457  „ 

Carter  ;•.  Boehm  73,  207.  582 

V.  Brooklyn  Life  Ins.  Co.        356  a 

V.  German  Ins.  Co.  .360  a,  469 

V.  Humboldt  Fire  Ins.  Co.    93,  247, 

386,  478 

V.  John  Hancock  Life  Ins.  Co. 

344  B 
V.  Niagara  Dist.  Mut.  F.  Ass. 

Co.  475 


XXV 


TABLE   OF  CASES. 
[The  references  are  to  the  sections.] 


Section 

Carter  !•.  Rocket  ^     '^^^ 

Carton  i-.  Southern  Mut.  Ins.  Co. 

Carver  Co.  ;•.  Manf  s  Ins.  Co.  53 

Cary  r.  Magle  ^  ,  ^^« 

Cascade  F.  &  M.  Ins.  Co.  v.  Journal 

I'ub.  Co.  30,  488 

Case  V.  Hartford  Ins.  Co.  402,  404 

Casey  ;-.  Goldsmith  2o6,  2o9 

c.  Nagle  345 

Cashan  v.  N.  W.  Ins.  Co.  11,  H  « 

Casler  v.  Conn.  Mut.  Life  Ins.  Co.    337 
Cassalhi  r.  riicjcnix  Ins.  Co.  591 

Cassity  r.  New  Orleans  Ins.  Ass.      425 
Casti'llain  v.  Preston  456  a 

Castner  v.  Farmers'  Mut.  Fire  Ins. 

Co.  35  a,  285,  562,  591 

Gaston  v.  Monmouth  Mut.  Fire  Ins. 

Co.  H4  B 

Catchings  v.  Manglove  391 

Catholic   Knights   of  America   v. 

Morrison  399  0 

Catlett  V.  Pacific  Ins.  Co.  452  E 

Catlin  V.  Springfield  Fire  Ins.  Co.     170, 
195,  247,  248,  408,  410,  465,  474,  475 
Catoir  v.  Amer.  Life  Ins.  Co.     126, 134, 
341,  511 
Catron  v.  Tenn.  Ins.  Co.  284,  373 

Cawley  r.  Nat.  E.  A.  Ass'n  158 

Cavon  V.  Dwelling-House  Ins.  Co. 

422  B,  466 

Cazenove  v.  British  Eq.  Ass.  Co.     212, 

296,  305 

Cedar  Rapids  Ins.  Co.  v.  Slump       245 

Central   Bank   of    Washington  v. 

Hume  399  L,  459  B 

Central  City  Ins.  Co.  v.  Gates   460,  461, 
462,491 
Central  Nat.  Bk.  v.  Hume  459  C 

Central  R.  R.  Co.  v.  Kisch  356 

Cerf  V.  Home  Ins.  Co.  239  a 

Cerys  r.  State  Ins.  Co.  285 

Chadbourne  v.  Germ. -Amer.  Ins. 

Co.  67  D 

Chaffee  v.  Cattaraugus  Co.  Mut. 

Ins.  Co.  185,  206,  258 

Chalaron  r.  Ins  Co.  of  North  Amer- 
ica 11 
Chamherlain  v.  Ins.  Co.          180  a,  447 
Chambers  r.  Atlas  Ins.  Co.                479 
V.  Northwestern  Mut.  L.  Ins. 

Co.  186,299 

Champlin   i;.  Railway   Pass.    Ass. 

Co.  525,  529,  530 

Chandler  v.  Commerce   Fire  Ins 

Co.  287  C 

V.  St.  Paul  Fire  &  Mar.  Ins. 

Co.  479,  487 

V.  Worcester  Ins.  Co.  411 

Cliapin  V.  Fellowes  391,  392 

xxvi 


Section 
Chapman  r.  Atlantic  &  St.  Law- 
rence R.  R.  Co.  94 
V.  Chapman                                   291 
V.  Delaware  M.  Ins.  Co.  65 
V.  Gore  Dist.  Mut.  Ins.  Co.        190 
V.  Mcllwrath                             391  A 
V.  Pote                                  448,  477 
V.  Republic  Life  Ins.  Co.            322 
r.  Rockford  Ins.  Co.                    494 
Charleston  Ins.  &  Tr.  Co.  v.  Neve 

378  A, 379,  468 
Charleston  Ins  Co.  v.  Potter  566  C 
Charter  Oak  Life  Ins.  Co.  i'.  Braut  391 
Chartiers  &  Rob.  Turnpike  Co.  v. 

McNamara  25 

Chase  v.  Hamilton  Mut.  Ins.  Co.       50, 

133,  137,  261,  287 

V.  Ins  Co.  67 

V.  Ph^nix,  &c.  Ins.  Co.    344  a,  574 

V.  Washington,  &c.  Ins.  Co.     94  A, 

133  0 

Chattillon  v.  Canadian  Mut.  Fire 

Ins.  Co.  143,  159,  216 

Chattock  V.  Sliawe  297 

Cheek  v.  Columbia  Fire  Ins.  Co.     143, 

207 
Cheever  v.  Union   Mut.  Life  Ins. 

Co.  185,  190,  207,  216,  499 

Cheeves  v.  Anders  109  a 

Chesbrough  v.  Home  Ins.  Co.  434 

Chester  Glass  Co.  v.  Dewey  23  D 

Chicago  Mut.  Life  Indem.  Ass.  v. 

Hunt  552 

Chicago  Sugar  Ref.  Co.  v.  Ameri- 
can S.  B.  Co.  2 
Chickering  v.  Globe  Mut.  Life  Ins. 

Co.  134 

Chipman  v.  Carroll  447  A,  449 

Chisholm  v.  Nat.  Cap.  Life  Ins.  Co.   75, 

107  a 
V.  Prov.  Ins.  Co.  382 

Chomas  v.  Cummiskey  452  A 

Chovvne  v.  Baylis  395 

Chrisman  v.  State  Ins.  Co.     100  A,  161, 
447  A,  589 
Christian  v.  Conn.  Mut.  L.  Ins. 

Co.      •  158,  327 

V.  Niagara  F.  Ins.  Co.  434 

Christie  v.  N.  Brit.  Ins.  Co.   50,  51,  64, 

570 
Christy  v.  Homoeopathic  Mut.  Ins. 

Co.  344  H 

Church  V.  Lafayette  Fire  Ins.  Co.    134 
Church  of  St.  George  v.  Sun  F. 

Office  Co.  364 

Cincinnati  Mut.  Health  Ass.  Co. 

i\  Kosentlial  577 

Cinque  Mars  v.  Eq.  Ins.  Co.  465 

Citizens'  Ins.  Co.,  In  re  541  a 

V.  Bland  469  C 


TABLE   OF   CASES. 


[The  references  are  to  the  sections.] 


Citizens'  Ins.  Co.  v.  Crist  263  A 

V.  Doll  287,  384,  465,  471,  475 

V.  Marsh  407,  411 

v.  McLaughlin  179,  239 

Citizens'  Mut.  Ins.  Co.  v.  Sortwell,  552, 

559 
Citizens',  &c.  Ins.  Co.  v.  Parsons  26.S  D, 

578  « 

V.  Short  373 

City  Bank  r.  Adams  459  F 

V.  Sovereign  L.  A.  Co.  325 

City  Bank  of  Gurney,  Tn  re  595 

City  Fire  Ins.  Co.  v.  Carrugi        180  a, 

215  a,  372 

V.  Corlies  242,  403,  413 

V.  Mark      101.  379,  381,  384,  401  a 

Citv  Five  Cents'  Savings  Bank  v. 

Penn.  Ins.  Co.  369 

City  Ins.  Co.  v.  Bricker  158 

V.  ZoUer  56 

City  of  Davenport  v.  Peoria  Mar. 

&  Fire  Ins.  Co.  15,45o,  191,  400,565 
City  of  Lond.  Fire  Ins.  Co.  v.  Smith  479 
City  of  Worcester  v.  Worcester 

Mut.  Fire  Ins.  Co.  408 

City  Planing  &  Shingle  xMill  Co. 

V.  Mercliants'  Mut.  F.  Ins.  Co.      253 

City  Sav.  Bank  r.  Whittle  399  L 

Claflin  r.  Commonwealth  Ins.  Co.    477 

V.  U.  S.  Credit  System  Co.  1 

Clapp  V.  Farmers'    Mut.  F.   Ins. 

Ass'n  287  B 

V.  Mass.  Benefit  Ass.  161,  202 

V.  Un.  Mut.  Ins.  Co.  287 

Clark  r.  Allen  398 

V.  Baird  423  B 

V.  Dawson  399  0 

i;.  Durand  391 

V.  Dwelling-House  Ins.  Co.  81 

V.  Fireman's  Ins.  Co.  81,  420 

V.  German  Mut.  Fire  Ins.  Co.  287 
V.  Hamilton  Mut.  Ins.  Co.  208,  367 
v.  Inhabitants  of  Blything  454,455 
V-  Manufactures',  &c.  Ins.  Co.  192, 
•207,  215  a,  567 
V.  Middleton  577 

V.  Mobile  578  a 

V.  N.  E.  Mut.  Ins.  Co.        274,  278, 
365,  365  B,  468,  473 
V.  Ocean  Ins.  Co.  30 

V.  Phoenix  Ins.  Co.  477 

V.  Scottish  Imp.  Ins.  Co.  82 

V.  Svea  F.  Ins.  Co.  379,  459  E 

V.  Union  Mut.  Fire  Ins.  Co.      143, 


V.  Western  Ass.  Co. 
V.  Wilson 
Clarke   v.    Manufacturers' 
Fire  Ins.  Co. 
V.  Morey 


180  a,  263 
83  a 

116,  457  B 

Mut. 

159 
42  A 


Section 

Clarke  v.  Schwarzenberg  459  B 

V.  Western  Ass.  Co.  364 

Clary  v.  Prot.  Ins.  Co.  420 

V.  Scottish  Imp.  Fire  Ins.  Co.  93  A 

V.  Union  Fire  Ins.  Co.  66 

Clason  V.  Smith  184,  188  D 

Clawson  v.  Citizens'  Mut.  F.  Ins. 

Co.  287  B 

Clay  r.  Harrison  79 

Clay  Fire  &  Mar.  Ins.  Co.  v.  Beck  287  C 
Clay  Fire,  &c.  Ins.  Co.  v.  Wuster- 

hausen  ^91 

Clay  Ins.  Co.  v.  Huron,  &c.  Co.  287,  577 

Clay,  &c.  Ins.  Co.  v.  Beck  287 

Cleaver  v.  Ins.  Co.  369 

V.  Mutual  Reserve  Fund  L. 

Ass'n  399  E,  407 

Clemens  v.  Supreme  Assembly      144  a 
Clement  v.  British  Amer.  Ass.  Co.      99, 

465 

V.  New  York  L.  Ins.  Co.    112,  327, 

398,  478 

V.  Phoenix  Ins.  Co.  -         122 

Clendining  v.  Church  75 

Clevengerr.  Mut.  Life  Ins.  Co.  126,  148 

Clift  V.  Schwabe        308,  309,  310,  313, 

316,  320 

Clifton  Coal  Co.  v.  Scottish  Union 

&  N.  Ins.  Co.  248,  269 

Clinton  V.  Hope  Ins.  Co.  91,  158,  159 
424,  445, 457 
Clubb  V.  American  Ace.  Co.  144  A 
Cluff  u.  Mut.  Ben.  Life  Ins.  Co.  328,  331 
Coates  V.  Penn  Fire  Ins.  Co.  447  A 
Coats  V.  West  Coast  F.  &  M.  Ins. 

Co.  434,  589 

Cobb  V.  Covenant  Mut.  Benefit 

Ass'n  186,  202,  303 

V.  Ins.  Co.  of  N.  A.  238 

V.  Lime   Rock  Fire   &  Mar. 

Ins.  Co.  156 

V.  N  E.  Mut.  M.  Ins.  Co.      452  E, 
496  B 
V.   Preferred     Mutual     Ace. 

Ass'n  517  A 

Coburn  v.  Life  Indemnity  Co.         70  C 

V.  Trav.  Ins.  Co.  591 

Cochran  v.  Mutual  L.  Ins.  Co.  325,  465 

Cockerell  v.  Cincinnati  Mut.  Ins. 

Co.  14,  18,  101 

Cofer  V.  Flanagan  465 

Coffee  V.  Universal  Life  Ins.  Co.      488 

Coflfey  V.  Home,  &c.  Ins.  Co.  325 

V.  Universal,  &c.  Ins.  Co.       344  a, 

358 
Cohn  V.  Continental  Life  Ins.  Co.   190, 

214 

V.  Ins.  Co.  70  B,  362 

v.  Mut  Life  Ins.  Co.  39.  39  A 

V.  N.  Y.  Life  Ins.  Co.  350,  568 

xxvii 


TABLE   OF  CASES. 
[The  references  are  to  the  sections.] 
Section 


Colin  V.  Virginia  Fire  &  Mar.  Ins. 

Co.  „ 

Coit  V.  Com.  Ills.  Co.  1J9 

Colbv  V.  Cedar  Kapids  Ins.  Co.  tJ', 

■^  69  B,  364 

V.  Life  Indemnity  Co.  70  C 

Cole  1-.  Accident  Ins.  Co.  324 

r.  Gerinania  Fire  Ins.  Co.      246  A 

V.  Marpie  391 

Coleman  i'.  Xew  Orleans  Ins.  Co.     279 

V.  Retail  Lumberman's  Ins. 

Co.  420 

Coles  V.  Bank  of  England  502 

V.  Iowa  State  Mut.  Ins.  Co.  552,  555 

V.  Jefferson  Ins.  Co.  175,  500 

Collelt  V.  Morrison  1",  356,  566 

Collier  v.  Bedell  5(59 

Colliniiridge  v.  Koyal,  &c.  Ins.  Co^.  424 

Collins  V.  Bankers'  Ace.  Ins.  Co    531  A 

V.  Cliarlestown  ^lut.  Fire  Ins. 

Co.  285 

V.  Farmville  Ins.  Co.  238,  239 

V.  Ins.  Co.  of  Fhila.  56 

V.  Locke  494 

r.  London  Ass.  Corp.     274,  291  A 

r.  ilercliants'  Mut.  Ins.  Co.       276 

r.  N.  Y.  Cent.  R.  Co.  455 

V.  North  British  Merc.  Ins.  Co.  239 

V.  St.  Paul  F.  &  II.  Ins.  Co.      257, 

448 

Colt  v.  Phoeni.x  Ins.  Co.  177,  269  a 

Columbia  Fire  Ins.  Co.  v.  Kinyon   563, 

577 

V.  Lawrence  408,  452  B 

Columbia  Ins.  Co.  v.  Buckley  553,  555 

r.  Cooper  84, 159 

V.  Masonheimer  67 

V.  Stone  555 

Columbian  Ins.  Co.  r.  Cooper  131,  140, 

143,  206,  552 

V.  Lawrence     81,  87,  195,  262,  284, 

377,  408,  449,  465,  466,  469,  488 

Columbus  Ins.  Co.  v.  Walsh    366,  575, 

577 

Combe's  Case  320 

Combs  V.  Hannibal  Ins.  (^o.  126  A,  129, 

131,  132,  144  C,  180  fl,  370,  499 

r.  Shrewsbury  Ins.  Co.  279,  282  A, 

372  A,  386 

Com.  Fire  Ins.  Co.  r.  Allen  1-24  A, 

4.33  A,  488 

V.  Cap.  City  Ins.  Co.         95  A,  590 

V.  Ives  144  G 

Commercial    Bank   v.   Firemen's 

Ins.  Co.  202,  477 

Commercial  Ins.  Co.  v.  Bergen         249 

V.  Friedlander  30 

V.  Hallock  44,  49,  53,  60,  134.  .360, 

400,  50r> 

V.  Huckberger  477 

xxviii 


Section 

Commercial  Ins.  Co.  v.  Ives      132,  140, 

497 
V.  McLoon  573 

r.  Mehlman  221,  239,  242,  244,  245 
V.  Morris  23  C,  126 

V.  Robinson  415,  479 

V.  Spankneble     189,  243,  267,  269, 
278,  292,  508 
Commercial  Mut.  Mar.  Ins.  Co.  v. 

Union  Mut.  Ins.  Co.  12a,  23 

Commercial  Travellers'  Mut.  Ace. 
Ass'n  V.  Fulton  298 

V.  Springsteen  531  A 

Commercial   Union    Ass.    Co.   v. 

Amer  Cent.  Ins.  Co.   11,365,369 
V   Canada  Iron,  &c.  Co.  401  a 

V.  Hocking 
V.  Norwood 
V.  Scaminon 
V.  State 
Commonwealth 
Ins.  Co. 
V.  Andrews 
r.  Dennis 


465,  479,  492 

369 

273,  276  A 

23  A,  120,  469,  589 

American  L. 

594 
407  A 
327  A 
..  Dorchester  Mut.  Fire  Ins. 

Co.  557,  559,  .594 

V.  Hide  &  Leather  Ins.  Co.  80, 167, 

420,  595 

V.  Mass.  Mut  Ins.  Co.       559,  560, 

594.  549  ffl 

V.  Mechanics'  Mut.  Ins.  Co.  558, 559 

V.  Niagara  Fire  Ins.  Co.  82 

V.  Nutting  578  a 

V.  Ordway  328 

V.  Provident  L.  Ass'n  70  C 

V.  Union  Mut.  Fire  Ins.  Co.      553, 

555,  559,  560 

V.  Wetherbee  1,  550  a 

Commonwealth  Ins.  Co.  v.  Berger  175, 

274 
V.  Monninger  159 

V.  Sennett     423,  430,  432,  465,  579 
Commonwealth  Mut.  Fire  Ins.  Co. 

v.  Huntzinger  156,  .369 

V.  Knnbe  Co.  125,  159,  557 

Comp.  de  rUnion  c.  Fouvre       356,  478 

Comp.  des  Phceni-x  c.  Dohis     358,  365, 

502  rt 
Compton  V.  Beecher  2 

Conadeau  v.  American  Ace.  Co.       325 
Conboj'  I'.  Railway  Officials'  Ace. 

Ass'n  530 

Concord   Mut.   Fire   Ins.   Co.  v. 

Woodbury  116,449,456 

Condon  v.  South  Side  R.  R.  493 

Cone  V.  Niagara  Ins.  Co.      80,  143,  456 
Confederation    Life   Ins.    Co.    f. 

O'Donnell  65 

Conn.  F.  Ins.  Co.  v.  Hamilton      469  C. 

492.  494 


TABLE   OF   CASES. 


[The  references  are  to  the  sections.] 


Section 

Conn.  F.  Ins.  Co.  v.  Railway  Co.     454 

V.  Smith  401  a,  56G 

17.  Tilley  247 

Conn.  Inil.  Ass'n  v.  Grogan      55  A,  360 

Conn.  Ins.  Co.  v.  Schwenk  405 

Conn.  Life  Ins.  Co.  v.  McMurdy       30:J 

Conn.  Mut.  Ins.  Co.  v.  Ryan  391 

V.  Siegel  477 

Conn.  Mut.  L.  Ins.  Co.  v.  Akens      325 

V.  Baldwin         399  D,  399  L,  399  H 

V.  Beal  67  M 

V.  Burrouglis  391 

V.  Fislier  398  A 

V.  Luclis  109  a,  501,  579 

V.  McWliirter  325 

V.  N.  Y.  &  N.  H.  R.  R.  Co.  453,  454 

V.  Scamnion  452  B 

V.  SchaefEer     8,  100,  106,  107,  1 10, 

117 

V.  Westervelt  391  A 

Conn.  R.  Mut.  Fire  Ins.  Co.  v.  Way  577 

Conn.,  &e.  Ins.  Co.  v.  Duerson  350 

V.  Groome  317 

Connell  v.  Piioeni.x  Ins.  Co.  580 

V.  Scottisii  Conn.  Ins.  Co.         401  a 

Conover  v.  Muss.  Mut.  Life  Ins. 

Co.  164,  185,  187,  296 

V.  The  Mut.  Ins.  Co.  of  Al- 
bany 139,  269 
Conrad's  Estate,  In  re  399  D 
Considine  v.  Met'n  Life  Ins.  Co.        156 
Consolidated,  &c.  Fire  Ins.  Co.  v. 

Cashow  11,  11  A,  359,  468,  584 

Constant  v.  The  AUegiiany  Ins.  Co.  15, 
23  D,  128 
Continental  Ins.  Co.  v.  JEtna.  Ins. 

Co.  11,400,  452  F 

V.  Anderson  27(3  C 

V.  Boykin  345  H 

V.  Chase  465 

V.  Chew  452  F 

V.  Dorman  345  E,  469  C 

V.  Heilman  365 

V.  Hillmer  591 

V.  Horton  365,  423_B 

V.  Hulman  379 

V.  Jachmehen  683 

v.  Jenkins  566 

V.  Kasey  499 

V.  Lippold  462 

V.  Loud  Lumber  Co.  453 

V.  Munns  144  A,  378  A 

V.  Pearce  44  A,  144  C 

V.  Randolph  ^469 

V.  Riegen  578  a 

r.  Ruckman        126,  144  D,  154  A. 
249  H, 469,  511 
V.  Ward  189,  275 

V.  Ware  283,  373 

V.  Wilson  494 


Section 
Continental  Life  Ins.  Co.  v.  Cham- 
berlain 124  A,  125 
V.  Daly  244  A 
V.  Goodhall           123,  126,  154,  305 
V.  Houser  569 
V.  Kessler  689 
r.  Palmer  390 
V.  Rogers                      161,  469,  589 
V.  Volger                                  103  A 
V.  Willets                                   360  B 
V.  Yung                                187,  296 
Continental,  &c.  Ins.  Co.  v.  Del- 

peuch  325 

Conver  r.  Phoenix  Ins.  Co.  296 

Converse  v.  Citizens'  Mut.  Ins.  Co.    99 

V.  Knights  Templars'  Ind.  Co.  336 

Conway  v.  Phoenix  M.  L.  Ins.  Co. 

^  126, 360 

Conway  Tool  Co.  v.  Hudson  R. 

Ins.  Co.  369 

Cook  V.  Black  395 

V.  Continental  Ins.  Co.  248 

V.  Federal  Life  Ass'n        29  C,  156 

V.  Lyon  lire  Ins.  Co.  188  F 

V.  Westchester  F.  Ins.  Co.         566 

Cooke  V.  TEtna  Ins.  Co.  154 

V.  Ox  ley  46 

Coolidge  V.  Gloucester  Mar.  Ins. 

Co.  30 

Coombs  r.  Shrewsbury  Mut.  Fire 

Ins.  Co.  502 

Coon,  Admr.  v.  Swan  449 

Cooper  r.  Farmers'  Mut.  Fire  Ins. 

Co.  156,  566 

V.  Ins.  Co.  of  Pennsylvania         138, 

287  B,  469  C 

V.  Mass.  Mut.  Life  Ins.  Co.      313, 

316 

V.  Pacific  Mut.  Life  Ins.  Co.  55,  56 

V.  Shaver  552,  559,  562 

V.  U.  S.  Mut.  Ben.  Ass'n  479 

Co-operative  Life  Ass.  v.  Leflore     185 

V.  McConnico  134 

Copeland  v.  Phoenix  Ins.  Co.  364,  589 

Copp  V.  Germ.  Amer.  Ins.  Co.         157, 

239  A 
Copper  Miners  v.  Fox  16 

Corbett  i\  Spring  Garden  Ins.  Co.  421  a 
Corkery   i:  Security  F.  Ins.    Co. 

294  E,  475 

Cormier  v.  Ottawa  Agr.  Ins.  Co.  452  D 

Cornell  v.  Hope  Ins.  Co.  466 

V.  Leroy  463,  466,  469 

V.  Milwaukie  Mut.  Fire  Ins. 

Co.  504 

V.  Moulton  400 

r.  Tiverton  Mut.  F  Ins.  Co.  294  J. 

Cornett  i'.  Phenix  Ins.  Co.  471 

Cornfoot  V.  Bovlston  Ins.  Co.  579 

V.  Fowke  "  3,  122,  172,  213 

xxix 


TABLE  OF  CASES. 


Section 

Comish  r.  Ace.  Ins.  Co.  409  A,  531  A 
V.  Farm  Buildings  Ins.  Co.  _^218 
Cornwell  r.  Fraternal  Ace.  Ass'n  531  A 
Corrigan  v.  Com.  Fire  Ins.  Co.  249  C 
Corson  r.  Garnier  1^*0  A 

Cory  r.  Burr  417  A 

Cossonan  v.  West  424  A 


Creeeh  v.  Richards 
Creed  r.  Sun  Fire  Office 


558 
158 
325 


Coster  l:  Phani.x  Ins.  Co. 
Coston  V.  Alleghany  Co.  Mut.  Ins. 

Co. 
Cotten  V.  Fidelity  Co. 
Cotter  V.  Royal  Neighbors 
Cottinghara't-.   Fireman's  Fund 

Ins.  Co.  279,  287  B 

Cotton,  &c.  Life  Ins.  Co.  i-.  Scurry    59 
Cotton    States     Ins.    Co.    v.    Ed- 
wards 344  D,  504  A 
r.  Lester  358 
Couch 

r.  Rochester  Germ 
Co. 
County  Life  Ass.  Co.,  In  re 
Coursin  r.  Penn.  Ins.  Co. 
Courteney  v.  Wright 


[The  references  are  to  the  sections.] 

Section 

84 

95  A,  285, 

459  E 

Creighton  r.  Homestead  Ins.  Co.        82 

Crescent  Ins.  Co.  v.  Camp  287  B 

V.  Griffin  &  Shook      372  A,  372  B 

1-.  Moore  454  F 

Crew-Levick    Co.   v.    British   & 


1< 


177 
177 
4<.»4 
379 
135 


Foreign  M.  Ins.  Co. 
Crigier  v.  Standard  F.  Ins.  Co 
Crisp  V.  Bunbury 
Criswell  »•.  Whitney 
Critchett  i-.  Am.  Ins.  Co. 
Crittenden  v.  Phoenix,  &c.  Ins.  Co.  390 
Crocker  i-  Peoples  Mut.  Ins.  Co.   180, 

250 
Crockford  r.  Lon.  &  Liv.  Fire  Ins. 

Co.  285 


City  Fire  Ins.  Co.  86,  369,  510    Croft  i-.  Hanover  F.  Ins.  Co..     3,  23  C, 
.Chester  Germ.  Fire  Ins.  .     125,  126,  566 


2.53  B 

27,63 

468.  488 

459  A 


Courtney  v.  y.  T.  City  Ins.  Co. 
Cousineau  v.  Citv  of  London  Fire 

Ins.  Co. 
Cousins  I'.  Nantes 
Coutourier  v.  Hastie 
Covenant  Mut.  Ben.  Ass 
way 

V.  Hoffman 

r.  Sears 

V.  Spies 
Coventry,  &c.  Ins.  Co.  i-. 
Coverstone  v.  Conn..  Sac. 


488 
33,  115 
353 
V.  Con- 

43  H 

307,  399  N 

399  D 

465,  562 

Evans       461 

Ins.  Co.     325 


Uowan  V.  Iowa  St.  Ins.  Co.  279 

V.  Phenix  Ins.  Co.  589 

Cowart  1-.  Capital  City  Ins.  Co.  294  E, 

364 
Cox  V.  .Etna  Ins.  Co. 

r.  Fire  Assurance  Co. 

r.  United  States 
Coye  V.  Leach 
Coykendall  i-.  Ladd 
Craig  r.  Dimock 

r.  Fenn 

V.  Springfield  Fire  and  Mar. 

Ins.  Co.  249  C 

Craighton  c.  Agr.  Ins.  Co.  465 

Crane.  In  re  399  D 

Crane  r  City  Ins.  Co.  223,  224 

Craufurd  v.  Hunter  77 

Cravens  v.  New  York  L.  Ins.  Co.  578  a 


Crawford  v.  .Etna  Life  Ins.  Co. 
Crawford   Co.  Mut.   Ins.  Co.  v. 

Cochran 
Crawley  >•.  Agr.  Ins.  Co. 
Cray  i-.  Hartford  Ins.  Co. 
Credit  Co.  v.  Howe  Machine  Co. 

XXX 


Croghan  r.  N.  Y.  Underwriters'  _ 

Agency  "0  B 

Crombie  v.  Portsmouth  Mut.  Ins. 
Co.  ^26 

386    Cromwell  i:  Brooklyn  Fire  Ins. 

Co.  379,  :386,  450 

Cronin  v.  Phila.  F.  Ass'n  159,  253 

Cronine  r.  Ken.  &  Lou.  Mut.  Ins. 

Co.  435 

Cronkhite  v.  Ace.  Ins.  Co.  352  A 

Crosby  r.  Franklin  Ins.  Co.  420 

r.  Stephan  459  B 

Cross  1-.  Andrews  309,  310 

V.  National  F.  Ins  Co.       111.  247, 

285.  294  C 

Crosslev  r.  Conn.  Fire  Ins.  Co.        493, 

494 
Grossman  v.  Mass  Benefit  Ass.  561  A 
Croswell  1-.  Mercantile  Mut.  Ins. 

Co.  420  B 

Crotty  V.  Union  Mut.  L.  Ins.  Co.      83, 

465 
Crowley  r.  Cohen  94  A 

465    Crown  Point  Iron  Co.  r.  ^tna 

Ins.  Co.  ■      69  a,  69  B 

Crozier  v.  Phoenix  Ins.  Co.       101,  377, 

379 
Culbertson  v.  Cox  452  A 

Cumberland  Bone  Co.  v.  Andes 

Ins.  Co.  83  a 

Cumberland   Vallev   Mut.    Prot. 

Ins.  Co.  1-. 'Douglas      247,  408 
1-.  Mitchell  :i85,  502 

r.  ScheU  132,  166.  376,  423, 

425.  501,  552 
Cummins  r.  Agricultural  Ins.  Co.    248 
r.  Cheshire  Ins.  Co.  .378,  391 

V.  German-American  Ins.  Co.     465 
1-.  Hildreth  378,  5o3 

f.  Sawyer  553 


374 

478 
66  A 


4.59  F 

25 

587  B 


350 

553 

477 

478 

23  D 


TABLE    OF   CASES. 
[The  references  are  to  the  sections.] 


Section 
Cunningham  i-.  Smith  308 

Curnow  V.  PliaMiix  Ins.  Co.  6(5 

Ciirrie  v.  Mut.  Ins.  Co.        552,  557,  560 
Currier  v.   Continental  Life   Ins. 

Co.  107  C,  340,  345,  345  II 

Curry  v.  Com.  Ins.  Co.        81,  184,  208, 
222,  285,  423,  426 
Curtin  v.  Phoeni.v  Ins.  Co.      343,348  A 
Curtis  r.  Home-  Ins.  Co.  488 

Cusliing  V.  Thompson  6,  456 

V.  Williamsburg  City  F.  Ins. 

Co.  589 

Cushman  ».  Liverpool,  &c.  Ins.  Co.  277 

V.  New  England  F.  Ins.  Co.  287  B, 

56G 

V.  North  Western  Ins.  Co.    30,  31, 

32  23'J 

V.  U.  S.  Life  Ins.  Co.   158,298!  304 

Cuthbertsnn  c.  Ins.  Co.  185,  277,  294  F 

Cutler  ;;.  Royal  Ins.  Co.  ]77 

Cyrenius  v.  .Mutual  Life  Ins.  Co.  399  D 


D. 


Dacey  v.  Agr.  Ins.  Co.  284  D 

Dadman    Manufacturing    Co.   v. 

Worcester  Mut.  Fire  Ins.  Co.  264 
Dafoe  V.  Johnstown,  &c.  Ins.  Co.  305 
Dahlberg  v.  St.  Louis  Mutual  Fire 

&  M.  Ins.  Co.  144  C,  .365  B 

Dailey  v.  Preferred  Masonic  Mut. 

Ace.  Ass'n  55  A,  306,  357,  -368 

V.  Westchester  Fire  Ins.  Co.  270  A 

Dakin  v.  Liverpool,  &c.  Ins.  Co.        283 

Dalbier  v.  Agricultural  Ins.  Co.        590 

Dalby  y.  India  &  London  Life  Ins. 

Co.  7,8,  115,  116,  117 

Dale  V.  Continental  Ins.  Co.  70  C 

Daly  V.  John  Hancock  Ins.  Co.        299 

V.  Nat.,  &u.  Ins.  Co.  677 

Damron  v.  Penn.  Mut.  Life  Ins. 

Co.  399  Q 

Dan  V.  Whetten  2'.)  H 

Dana  v.  Munro  549 

Daniel  v.  Robinson  278 

Daniels  r.  Citizens'  Ins   Co.  577 

V.  Equitable  Fire  Ins.  Co.   220,  460 

V.  Iluilsnn  R.  Fire  Ins.  Co.  60,  ].j6 

162,  179,  181,  184,  199,408,580 

Darrell  v.  Tibbetts  4.56  a 

Darrow  n.  F.  F.  Soc.  170,  .327  A,  563  A 

Date  )'.  Gore  District  Mut.  Ins.  Co.  226 

Daul  /•.  Firemen's  Ins.  Co.        430,  469 

Davega  v.  Crescent  Mut.  Ins.  Co.     566 

Davenport  v.  Long  Islan<l  Ins.  Co. 

496  B 

V.  N.  E.  Mut.  Ins.  Co.  290 

'•.  Peoria  Ins.  Co.  144 

Davey  f.  vEtna  Life  Ins.  Co.  301 


Section 

Davey  v.  Glens  Falls  Ins.  Co.  143,  249  I 

David  V.  Hartford  Fire  Ins.  Co.  288,  365 

V.  Oakland  Home  Ins.  Co.     469  D 

V.  Williamsburgli,  &c.  Ins.  Co. 

87  A,  285 
Davidson  ;;.  Guardian  Ass.  Co.         138 
V.  Ilawkeye  Ins.  Co.  267 

V.  Old  People's  Mut.  Ben.  Ass.  64  A 
I-.  Pluriiix  Ins.  Co.  478 

Davies  r.  Home  Ins.  Co.  82 

V.  National  M.  Ins.  Co.  158 

Davies'  Policy  Trusts,  In  re  399  D 

Davis  V.  JEtna.  Mut.  l'\  Ins.  Co.        125, 
184,  401  B 
V.  Anclior  Mutual  F.  Ins.  Co.    494 
V.  Atlas  Ass.  Co.  492 

V.  Canada,  &c.  Ins.  Co.  488 

V.  Davis  461 

V.  German  Am.  Ins.  Co.  378 

V.  la.  State  Ins.  Co.  289 

V.  Mass.  Ins.  Co.  492 

V.  Mass.  Mut.  Fire  Ins.  Co.  56 

V.  Niagara  Fire  Ins.  Co.        138  C, 
459  G 
v.  Phoenix  Ins.  Co.        83  a,  287  B, 
294  E 
V.  Pioneer  Furniture  Co.       239  A. 
256,  287  B 
V.  Quincy  Mut.  Fire  Ins.  Co.    267, 
285,  458 
V.  Scottish  Prov.  Ins.  Co.    143,  166 
V.  United  States  323 

V.  Western  Home  Ins.  Co.       222, 
239  A, 401  B 
Davis  Shoe  Co.  r.  Kittanninglns. 

Co.  469  C 

Davison  v.  London  &  L.  F.  Ins. 

Co.  67,  567 

Davy  V.  Ilallett  422  A 

Dawes  ?;.  North  River  Ins.  Co.  147 

Dawson  v.  Fitzgerald  404 

Day  IV  Case  399  N 

V.  Charter  Oak  Fire  &  Mar. 

Ins.  Co.  74,  189,  277,  287 

V.  Conn.  Gen.  Life  Ins.  Co.  356,  569 
V.  Conway  Ins.  Co.  261 

V.  Dwelling-IIouse  Ins.  Co.       250, 

511 
V.  Ilawkeye  Ins.  Co.  276  C 

V.  Mechanics'   and    Traders' 

Ins.  Co.  24  A 

V.  Mill  Owners'  Mut.  Fire  Ins. 

Co.  253  A 

V.  Mut.  Ben.  Life  Ins.  Co.  190,201, 

355,  477 

V.  N.  E.  Life  Ins.  Co.  459  G 

Dayton  Ins.  Co.  v.  Kelley        14  22  23 

126,  129,  166,  365,'497 

Dayton  Union  Ins  Co.  v.  McGookey  14-'^ 

Dean  i-.  vEtiia  Life  Ins.  Co.  134 


XXXI 


TABLE   OF   CASES. 
[The  references  are  to  the  sections.] 
Section 


310,  312,  .313, 
316 


592 

451)  E 

446 

24  A 

395 

287  C 

579 


Section 


Dean  v.  Am.  Life  Ins.  Co. 


Dean  and  Chapter  of  Norwich 

Dean  &  Son's  Aiipeul 

■Dear  r.  Western  Ass.  Co. 

Dearborn  v.  Cross 

Dearie  r.  Hall 

De  Armaml  r.  Home  Ins.  Co. 

De  Bolle  '-.  Penn.  Ins.  Co.     447  A 

De  Camp  v.  New  Jersey  Mut.  Life 

Ins.  Co.  ,  56, 190 

Decatur  Bank  v.  St.  Louis  Bank  420 
De'clieance  ct  aut.  c.  Comp.  d'Ass.  539 
Deem  v.  Millikin  407 

De  forest  v.  Fulton  Fire  Ins.  Co.     78, 
80,  180,424,448 
De  Frece  v.  National  L.  Ins.  Co.  356  A 
De  Gogorza  v.  Knickerbocker  Life 

Ins.  Co.  322 

De  Graff  v.  Queen  Ins.  Co.  175,  401  C 
De  Graw  v.  Nat'i  Accident  Soc.  520  A 
De  Grove  v.  Metropolitan  Ins.  Co.  23 
De  Ilalm  v.  Hartley  575 

De  Jonge  r.  Goldsmith  399  Q 

Deier  v.  Continental  Life  Ins.  Co.  298 
Deitrich   ;;.   Madison   Jiel.   Ass.      390, 

550  « 
Deitz  V.  Ins.  Co.      124  A,  144  D,  144  E, 

294  E 
I'.  Mound   City  Mut.  Fire  & 

Life  Ins.  Co.  372  D 

V.  Providence- Washington  Ins. 

Co.  566 

Delahay  v.  Memphis  Ins.  Co.  215,  215a 
Delancey   v.    Rockingham    Mut. 

Fire  Ins.  Co.  143,  180  n 

Dehivigne  r.  U.  S.  Ins.  Co.  567 

Delaware  Farmers'  Mut.  Fire  Ins. 

Co.  p.  Wagner  547  a 

Delaware  Ins.  Co.  v.  Hogan  566  A 

V.  Quaker  City  Ins.  Co.  12 

Delongnemare  v.  Tradesman's  Ins. 

Co.  1.59,162,177,239,428 

Delouche  v.  Met'n  L.  Ins.  Co.     144  D, 

399  Q 
De  Loy  v.  Travelers'  Ins.  Co.  531  A 
DemiU  V.  Hartford  Ins.  Co.  371,  378 
Deming  v.  Merchants'  Cotton-press 


Co. 


434 
5.57 
244 
560  B 
325 
248 
202 


Demings  v.  Knights  of  Pythias 
Denkler  v.  Ins.  Co. 
Dennis  v.  Mass.  Ben.  Ass. 

V.  Union  Mut.  L.  Ins.  Co. 
Dennison  v.  Phconix  Ins.  Co. 

V.  Thomaston  Mut.  Ins.  Co 

207,  210,  259 
Denniston  v.  Imbrie  42 

Denny  r.  Conway  Stock  &  Mut. 

Fire  Ins.  Co.  141,  159 

Denton  v.  G.  N.  Railway  Co.        188  F 

xxxii 


D'Orlu  V.  Bankers  &  M.  M.  L. 

Ass'n  340 

Depaba  v.  Ludlow  75 

De  Pevster  v.  Am.  Fire  Ins.  Co.     594  a 
Deraismes  v.  Merchants'  Mut.  Ins. 

Co.  5496 

Dermani  v.  Home  Ins.  Co.  of  N.Y.     279 
Derrick  v.  Lamar  Ins.  Co.  488 

Desilver  v.  State  Mut.  Ins.  Co.  471,  505 
Des  Moines  Ice  Co.  v.  Niagara  F. 

Ins.  Co.  247,401a 

Detroit  Manufacturers'  Mut.  Fire 

Ins.  Co.  V.  Merrill  567 

Deusen   v.   Charter  Oak  Fire  & 

Mar.  Ins.  Co.  ^     270 

De  Van  v.  Commercial  Travelers' 

Mut.  Ace.  Ass'n  517  A 

Devendorf  u.  Beardsley     133,  552,  557, 
591,  594 
Devens  v.  Merchants',  &c.  Ins.  Co.    507 
Devereux  v.  Insurance  Co.  67  L 

u.  Sun  Fire  Office  566  A 

Devine  v.  Home  Ins.  Co.  248 

Dewees  v.  Manhattan  Ins.  Co.  156, 183 
DeWitt  V.  Home  Forum   Benefit 

Order  299 

DeWolf  V.  Capital  City  Ins.  Co.  294  C 

V.  N.  Y.  Firemen's  Ins.  Co.     215  C 

Dey  V.  Poughkeepsie  Mut.  Ins.  Co.  264, 

fa         ^  279,386 

Dezell  V.  Odell  502 

Dial  V.  Valley  Mut.  Life  Ass.       469  C, 
560 B,  579  A 
Dibble  v.  Northern  Ass.  Co.  3 

Dibbrell  v.  Georgia  Home  Ins.  Co.  138 
Diboll  V.  JEtna.  Life  Ins.  Co.  135,  362 
Dick  r.  Equitable  F.  &  M.  Ins.  Co.    138, 

469  D 
r.  Franklin  Ins.  Co.  457 

Dickerman  v.  Quincy  Mut.  F.  Ins. 

Co.  126 

V.  Vermont  Mut.  F.  Ins.  Co.       590 

Dickie*'  Merchants' Mut.  Ins.  Co.     402 

V.  Western  Ass.  Co.  479 

Dickinson  County  v.  Miss.  Valley 

Ins.  Co.  126 

Dickson  v.  Eq.  Fire  Ins.  Co.  373 

V.  Provincial  Ins.  Co.  190,  365, 502 
Diebold  v.  Phoenix  Ins.  Co.  144_A 

Diedericks  v.  Com.  Ins.  Co.  278 

Diedrich  v.  N.  W.  Co.  890 

Diehl  V.  Adams  County  Mut.  Ins. 

Co.  218,  227,  247,  508,  552 

Dietz  V.  Knickerbocker  Life  Ins. 

Co.  345  a 

Diffenbaugh  v.  Union  F.  Ins.  Co.     81, 

287  B 

Dillard  v.  Manhattan  Life  Ins.  Co.  39, 

39  A,  40,  334,  3.50  a 

Dilleber  v.  Home  Life  Ins.  Co.  166,  304 


TABLE   OF   CASES. 
[The  references  are  to  the  sections.] 


Section 
Dilleber    v.    Knickerbocker   Life 

Ins.  Co.  135,  304,  358 

Dilling  V.  Draemel  453 

Diman  v.  Prov.,  &c.  R.  R.  Co.  566 

Dingee  v.  Aav.  Ins.  Co.  145 

Dinninsf  v.  Plioenix  Ins.  Co.       50,  70  B 
Dircks  r.  German  Ins.  Co.  137  A 

Disbrow  v.  Jones  6 

Dittnier  v.  Germania  Ins.  Co.  230 

Ditwiller  v.  Plioeni.K  Fire  Ins.  Co.     2o9 
Dix  V.  Mercantile  Ins.  Co.     277,  280, 

281 
Dixon  V.  National  L.  Ins.  Co.     83,  379, 

308 

V.  Sadler  408 

Doane  v.  Milville  Ins.  Co.         64  A,  67 

Dobson  IK  Laud  116 

V.  Sotheby  241,  242,  262 

Dobyns  v.  Bay  State  Ben'y  Ass'n     359 

Dodd  V   Home  Mut.  Ins.  Co.  70  B 

V.  Jones  399  B 

Dodge  V.  Essex  Ins.  Co.  566 

V.   Hamburg-Bremen  F.  Ins. 

Co.  275 

Dodge  Co.  Mut.  Ins.  Co.  v.  Rogers     143 

Doe  V.  Dixon  172  A 

V.  Knight  60 

V.  Nepean  465 

Dogge  V.  Nortli  Western  Ins.  Co.     386, 

477 
Dobn  V.  Farmers',  &c.  Ins.  Co.         166, 
285,  290,  292 
Dolan  V.  Missouri  Town  Mut.  F. 

Ins.  Co.  156 

V.  Mutual  Reserve  Fund  Life 

Ass'n  156.  294  C,  305 

Dolliver  v.  St.  Joseph,  &c.  Ins.  Co.  287, 

466 
Dolmo  V.  Farmers'  Joint   Stock 

Ins.  Co.  285 

Donahue  i". Windsor  Co.  Mut.  Fire 

Ins.  Co.  462,  469,  .508,  589 

Donald  v.  Piedmont,  &c.  Life  Ins. 

Co.  65,  357 

Donaldson  r.  Ins.  Co.  83,  90,  446 

V.  Manchester  Ins.  Co.  366 

Donnell  v.  Donnell  112,  459  E 

Donnelly  v.  Cedar  Rapids  Ins.  Co. 

144  C 
Donogh  V.  Farmers'  F.  Ins.  Co.  365  B 
Dooly  V.  Hanover  F.  Ins.  Co.  285 

Doran  ;;.  Franklin  Fire  Ins.  Co.        366 
Dorey  v.  Met'n  L.  Ins.  Co.  298 

Dorion  v.  Pos.  Gov.  Life  Ass.  Co.    358 
Dormay  r.  Borradaile  3"J3 

Dorn  V.  Germania  Ins.  Co.  224 

Dorr  r.  Hope  Ins.  Co.  174 

Dougherty  i'.  Neal  350 

Douglass  i».  White  452  F 

Doull  V.  Western  Ass.  Co.  483 


Section 
Dover  Glass  Works  Co.  v.  Ameri- 
can F.  Ins.  Co.  70  a,  253,  291  A 
Dow  V.  Phcenix,  &c.  Ins.  Co.  344  u 
Dowd  V.  American  Fire  Ins.  Co.  288 
Dowling  V.  Lancashire  Ins.  Co.        126, 

263  E 

V.  Merchants'  Ins.  Co.  256 

Downey  v.  Hoffer  398 

Dows  V.  Faneuil  Hall  Ins.  Co.  418 

V.  Insurance  Co.  412 

Doyle  V.  City  of  Glasgow  L.  A. 

Co.  465 

V.  Continental  Ins.  Co.  578 

V.  Phoenix  Ins.  Co.  589 

Dozier  v.  Fidelity  Co.  517  A 

Drake  v.  Farmers'  Union  Ins.  Co.     497 

v.  Rollo  595 

V.  Stone  399  N 

Draper  v.  Charter  Oak  Ins.  Co.       122, 

145,  185 
V.  Cora.  Ins.  Co.  156 

Dreher  v.  ^tna  Ins   Co.  280 

Dresser  v.  United  Firemen's  Ins. 

Co.  279,  294  E 

Driggs  V.  Albany  Ins.  Co.       70  A,  190 
Drinkwater  v.  London  Ins.  Co.  403 

Dryer  y.  Security  F.  Ins.  Co.        144  D, 

401a 
Drysdale  r.  Pigot  108 

Dual  V.  Firemen's  Ins.  Co.  477 

Dube  r.  Fire  Ins.  Co.  379 

Ducat  77.  Chicago  578  a 

Duckett  V.  Williams  156,  202,  297 

Duclos  V.  Citizen's  Mut.  Ins.  Co.  364  A 
Dudley  v.  Wells  25 

Dufaur  v.  Professional  Life  Ins. 

Co.  310,  324,  395 

Duke  of  Hamilton's  Trustees  v. 

Flemming  450 

Duluth    Nat.  Bank   v.  Knoxville 

Fire  Ins.  Co.  130  A 

Dumas  v.  Jones  424 

Dunbar  v.  Phenix  Ins.  Co.  29  C,  144  C, 

501 

Duncan  r.  Green  179  D 

V.  Great  Western  Ins.  Co.       276  B 

V.  New  York  Mut.  Ins.  Co.       67  L 

V.  Sun  Fire  Ins.  Co.     162,  231,  445 

V.  Topham  49,  51 

r.  United  States  66  A 

Dunham  v.  Morse  360 

Dunlap  V.  Higgins  48 

Dunlop  V.  Avery  452  C 

Dunn  V.  Commonwealth  Ins.  Co.      442 

Dupin  V.  Mutual  Ins.  Co.  403 

Dtipreau  v.  Insurance  Co.  287  C 

Dupree  v.  Virginia  Home  Ins.  Co. 

188  C 
Dupuy   V.   Delaware   Ins.   Co.       247, 

294  E 


XXXlll 


TABLE   OF   CASES. 
[The  references  are  to  the  sections.] 


Section 
Dur.and  v.  Thouron  80,  122  A 

Durar  v.  Hudson   County   Mut. 

Ins.  Co.  139,  383,  387 

Durham  i\  Fire  &  Mar.  Ins.  Co.   287  C 
Durrant  v.  Brank  278 

;;.  Friend  452  A 

Durrell  v.  Bederly  215  A 

Dutclier   v.   Brooklyn  Life   Ins. 

Co.  344  a,  344  H 

Dutton  V.  N.   E.  Mut.  Fire   Ins. 

Co.  269,  294 

V.  Vt.  Mut.  Ins.  Co.  491 

V.  Wiilner  67  B 

Duvall  V.  Goodson  390 

Dwelling-House  Ins.  Co.  v.  Brew- 
ster 469  C 
V.  Dowdall                               469  D 
V.  Hoffman                               292  A 
V.  Johnson  589 
V.  Kansas  Loan  &  Trust  Co.       478 
V.  Osborn                 248,  469  D,  479 
Dwight  V.  Germania  Life  Ins.  Co.  156, 
298,  .399  F,  399  G,  3991 
Dwver  v.  Continental  Ins.  Co.        407, 

583 
V.  Edie  108 

Dyer  v.  Piscataqua  Fire  &  Mar. 
Ins.  Co.  591 


E. 


Eadie  v.  Slimmon  391,  397,  399  0 

Eagan  v.  Mtnsi,  &c.  Ins.  Co.  294  b,  575 
V.  Fireman's  Ins.  Co.  13 

Eager  v.  Atlas  Ins.  Co.  179  B 

Eagle  Fire  Co.  v.  Globe  Loan  & 

Trust  Co.  365 

Eagle  Ins.  Co.  v.  Lafayette  Ins. 

Co.  11,  11  A,  12,  478 

Eakin  7\  Home  Ins.  Co.         164,  373  A, 

420  A 
Fames  v.  Home  Ins.  Co.       48,  51,  120, 

144 
Early  v.  Standard  L.  Ins.  Co.         324, 

517  A 
Earnshaw  v.  Stewart  391  B 

Easley  v.  New  Zealand  Ins.  Co.      55 «, 

340 
Eastabrook   v.  Union   Mut.  Life 

Ins.  Co.  311,  313 

Eastern  R.  R.  Co.  v.  Relief  Fire 

Ins.  Co.  80,  94,  98,  151.  1-58,  468 

Eastman  v.  Carrol  Co.  Mut.  Fire 

Ins.  Co.  384 

East  Texas  F.  Ins.  Co.  v.  Blum     67  G, 

125,  364 

V.  Clarke  269 

V.  Crawford  287  B 

V.  Dyches  289,  469  C,  589,  590 

xxxiv 


Section 
East  Texas  F.  Ins.  Co.  v.  Flippin 

67,  365 
V.  Harris  263  A 

V.  Kerapner  230,  248 

V.  Minis  345  E,  360  B 

V.  Perkey  360 

Eaton  V.  Atlas  Ace.  Ins.  Co.  306 

{;.  Granite    State    Provident 

Ass'n  126 

Ebsworth  v.  Alliance  Ins.  Co.       78,  81 
Eckel  V.  Renner  398  A 

Eclectic  Ins.  Co.  v.  Fahrenkrug      126, 
185,  154,  295,  362 
Eclipse  Ins.  Co.  v.  Scboener  512 

Eddy   V.   Hawkeye   Ins.   Co.      188  C, 
249 D,  292 B 
V.  London  As.  Corp.  364 

V.  :ohoenix  Mut.  Life  Ins.  Co.  560 B 
Eddy  St.    Iron    Foundry  v.  Far- 
mers'Mut.  Ins.  Co.    188  A, 375, 401  a 
Edeck  V.  Ranuer  25 

Edes  V.  Hamilton  Mut.  Ins.  Co.        379 
Edge  V.  Duke  362 

Edgerly  v.  Farmers'  Ins.  Co.    466,  589 
Edington  v.  JEina,  Life  Ins.  Co.    188  C, 
215,  295 
V.  Mutual  Life  Ins.  Co.      158,  212, 
304 
Edmands  v.  Mutual  Safety  Fire 

Ins.  Co.  271 

Edson   V.   Merchants'   Mut.   Ins. 

Co.  488 

Educational    Endowment   Ass'n, 

In  re  594 

Edwards  v.  Agricultural  Ins.  Co.     379 

V.  Baltimore  Ins.  Co.  462,  464 

V.  Barrow  215 

V.  Footner  188  E 

V.  Martin  396 

V.  Scott  396 

V.  Travelers'  Life  Ins.  Co.         464 

Egan  V.  Fireman's  Ins.  Co.  120 

V.  Mut.  Ins.  Co.  425 

V.  Oakland  Ins.  Co..  479 

Eggleston  v.  Centennial  Mut.  Life 

Ins.  Ass.  563  A 

V.  Council  Bluffs  Ins.  Co.    465,  488 
Elirman  v.  Teutonia  Ins.  Co.  577 

Ehrsani  Machine    Co.  v.  Phenix 

Ins.  Co.  267 

Eilenberger   v.  Protective    Mut. 

Ins.  Co.  133,  140,  145,  552 

Eiseman  v.  Hawkeye  Ins   Co.  497 

Eisner  v.  Guardian  Life  Ins.  Co.      298 
Ela  V.  French  22 

Elgutter  V.  Mutual  Reserve  Fund 

L.  Ass'n  590 

Eliason  v.  Henshaw  50 

Eliot  Five  Cents  Savings  Bank  v. 
Com.  Ass.  Co.     433  A,  457  C,  469  B 


TABLE   OF   CASES. 


[The  references  are  to  the  sections.] 


Sectiou 
Elkhart    Mut.    Aid,    &c.    Ass.   v. 

Houghton  75  B,  399  E,  563  A 

Elkins  V.  Susquehanna  Mut.  Fire 

Ins.  Co.  360  A 

Ellerbe  v.  Faust  594 

V.  United  Masonic  Ben.  Ass'n      594 
Ellerson  v.  Westcott  407 

Eilicott  V.  U.  S.  Ins.  Co.   73,  97, 446,  545 
Elliott  V.  Ashland  Mut.  Fire  Ins. 

Co.  287  C 

V.  Hamilton  Mut.  Ins.  Co.         161, 

193,  233,  239 

V.  Lycoming,  &c.  Ins.  Co.         277, 

372,  502,  505 

V.  Merchants'  &  Bankers'  F. 

Ins.  Co.  430 

V.  Royal  Exch.  Ass.  Co.  494 

V.  Whedbee  399  F 

Ellis  V.  Albany  City  Fire  Ins.  Co.     59, 

65,  191 
V.  Buzzell  378  A,  583 

V.  Council  Bluffs  Ins.  Co.  479 

V.  Ins.  Co.  22,  287  C 

V.  Kreutzinger  379 

V.  Mass.  Mut.  L.  Ins.  Co.       345  E 
V.  Nortli  Am.  Ins.  Co.  407 

V.  State  Ins.  Co.  378  A 

Ellison  V.  Tuttle  459  S 

EUmaker  v.  Franklin   Fire   Ins. 

Co.  420 

Elstner  v.  Cincinnati  Eq.  Ins.  Co.    566 
Elwell  V.  Crocker  549 

Ely  V.  Ely  456 

Enibler  v.  Hartford  Steam  Boiler 

Inspection  &  Ins.  Co.  2 

Embree  v.  Shideler  557 

Emerick  v.  Coakley  390 

Emerson  v.  Murray  29  A 

Emery  v.  Boston  Marine  Ins.  Co.  23  C 
i;.Mut.City,&c.  Fire  Ins.  Co.  365  B 
V,   Fiscataqua   Fire   &   Mar. 

Ins.  Co.  131,  180  a 

Emigh  V.  State  Ins.  Co.  589 

Eminence  Mut.  Ins.  Co.  v.  Jesse     287, 

289,  294  D 

Emmott  V.  Slater  Mut.  Fire  Ins. 

Co.  68 

Empire  State  Ins.  Co.  v.  Am.  Cen- 
tral Ins.  Co.  125 
Employers'  L.  Ass.  Co.  v.  Merrill        2 
Emulous,  Tlie  36 
Engelbretson,  v.  Hekla  Fire  Ins. 

Co.  465 

England  v.  Tredegar  444 

v.  Westchester  F.  Ins.  Co.  247 

English  V.  Franklin  Ins.  Co.  401  B 

Ennis  v.  Harmony  Fire  Ins.  Co.       446, 

449 

Enos  V.  St.  Paul  F.  &  M.  Ins.  Co.     477 

V.  Sun  Ins.  Co.  137  A,  511 


Section 
Ensworth  v.  N.  Y.  Life  Ins.  Co.       576, 

582 
Enterprise  Ins.  Co.  v.  Parisot         408, 

469  C 
Epes  V.  Arlington  Ins.  Co.  305 

Eppinger  r.  Canepa  399  I,  459  C 

Epstein  v.  State  Ins.  Co.  566 

Equitable  F.  Ins.  Co.  v.  Alexan- 
der 369 
V.  Quinn  424 
Equitable  Ins.  Co.  v.  Cooper        385  A 
V.  Hearne                                   566  A 
V.  McCrea,  &c.             360  A,  365  B 
V.  McLennan  341 
Equitable  Life  Ass.  Co.  v.  Brobst 

154  A 
V.  Paterson        107  b,  186,  295,  321, 

573 
Equitable  L.  Ass.  Society  v.  Clem- 
ents 66  A, 69  a 
V.  McElroy  55  A,  70  C,  159,  399  D 
V.  Trimble  66 
V.  Winning                                  66  A 
Equitable  Life  Ins.  Co.  v.  Poe           138 
Equitable  Reserve  Fund  L.  Ass'n, 

In  re  276  A,  594 

Erb  V.  German-American  Ins.  Co.    405 
Erhman  i\  Teutonia  Ins.  Co.  577 

Erman  ;;.  Sun  Mut.  Ins.  Co.  477 

Ermentrout   v.    Girard  F.  &   M. 

Ins.  Co.  402 

Erwin    v.    Springfield    Fire    and 

Mar.  Ins.  Co.  462,  475 

Essex  Savings  Bk.  v.  Meriden  Ins. 

Co.  276  C.  285 

Estate  of  Madeira  399  I 

Estate  of  Malone  395 

Estate  of  Trough  395 

Eureka  Ins.  Co.  v.  Baldwin        248,  500 

V.  Robinson  23,  424 

Evans  v.  Bignold  113 

r.  Columbian  Ins.  Co.        239,  418 

V.  Edmonds  591 

V.  Tri mountain  Mut.  Fire  Ins. 

Co.  146,  594 

V.  U.  S.  Life  Ins.  Co.  335,  352 

Everett  v.  Continental  Ins.  Co.        219, 

256,  420 

V.  Desborough  123,  213,  304 

V.  London  &  Lancashire  Ins. 

Co.  1.38 

V.  London  Ass.  Co.  414 

V.  Niagara  Ins.  Co.  479 

Evers  v.  Life  Ass.  390 

Ewer  V.  Washington  Ins.  Co.        579  B 

Excelsior  Fire  Ins.  Co.  v.  Royal 

Ins.  Co.  45a,  116,  420,  424,  456, 

456  a,  457 

Excelsior  Mut.  Aid  Ass.  v.  Riddle     590 

Exchange  Bank  v.  Loh  83 

XXXV 


TABLE    OF   CASES. 


Section 

Fabbri  v.  Phoenix  Ins.  Co.  172  A 

Fabyan  v.  Union  Mut.  Fire  Ins. 

Co.  67,  364  A 

Fair  v.  Manhatten  Ins.  Co.  iOl  <f 

Fairciiiid  c.  Liverpool,  &c.  Ins.  Co.    436 
V.  ISortli  Eastern  Mut.  Life 

Ass.  112,  303 

Fairfield  Tacking  Co.  r.  Southern 

iMut.  Fire  Ins.  Co.  477 

Falls  i\  Conway    Mut.  Fire  Ins. 

Co.  287 

Fame  Ins.  Co.  v.  Mann  124  A 

V.  Norris  452  F 

V.  Thomas  185,  207 

Fame  Ins.  Co.'s  Appeal  12  N 

Faneuil  Hall  Ins.  Co.   v.   Liver- 


pool 

,  &c.  Ins.  Co. 

12 

Farley 

V.   Union   Mut. 

Life 

Ins. 

Co. 

344  H 

Farmers'  Bank  v.  Maxwell 

345 

Farme 

rs'  Ins.  Co.  V.  Archer 

2' 

■6  A 

c. 

Ashton 

282 

V. 

Butler 

81 

V. 

Chase 

557, 

559 

V. 

Chesnut 

501 

V. 

Curry 

180  a 

247 

287 

V. 

P'ogleman 

285 

V. 

Johnston 

453 

V. 

Mispelhorn 

465 

V. 

Moyer 

469 

V. 

Munn 

140 

Farmers'  Ins.  &  Loan  Co.  v.  Sny- 

der 

184 

256 

Farmers'  Mut.  Fire   Ins.   Co 

.    V. 

Gargett 

583 

591 

V. 

Marshall 

133 

V. 

Moyer 

218 

469 

V. 

Schaeffer 

2 

39  A 

V. 

Taylor            1.32 

143, 

365  rt 

385 

Farmers'  Mut.  Ins.  Co. 

V.  Barr 

478 

V. 

Gray  bill 

264 

438 

448 

t\ 

Kryder 

420 

V 

Turnpike  Co. 

76  A 

Wenger  69  a.  385,  401a 

Farmers'  &  Drovers'  Ins.  Co.  v. 

Curry  156 

F.nrmers'  &  Mechanics'  Bank  v. 

Dearing  23  D 

Farmers'  &  M.  Ins.  Co.  v.  Gra- 
ham 126 
V.  Jensen                                 6,  264 
V.  Simmons  241 
V.  Wiard                                    345  E 
Farmers'  &  Mer.  Ins.  Co.  v.  Ches- 
nut 502 
Farmers,'  &c.  Ins.  Co.  v.  Bowen        553 
V.  Harmony,  &c.  Ins.  Co.  420 
V.  Meekes  473 


V.  Smith 


[The  references  are  to  the  sections.] 

Section 
Farmers'  Union  Ins.  Co.  v.  Wilder  360 
Farmington  Bank  v.  Fall  23  D 

Farmville  Ins.,  &c.  Co.  v.  Butler 

287  A,  566 B 

Farnum  v.  Phenix  Ins.  Co.       67,  151, 

359,  360,  494 

Farrell  v.  iEtna  Fire  Ins.  Co.        423  A 

V.  German-American  Ins.  Co.    478, 

496  B 

Farrell  Foundry  v.  Dart  133  D 

Faulkner  v.  Central  Fire  Ins.  Co.     242 

V.  Manchester  Fire  Ass.  Co.     261, 

465 
Faunce  v.  State  Mut.  Life  Ass.  Co.  56 
Fauntleroy's  Case  323 

Faust  V.  American  F.  Ins.  Co.         177, 
239,  239  A,  469  C 
Fawcett  v.   Liv.,  Lon.,   &    Globe 

Ins.  Co.  46.5,  466 

Fay  ;;.  Alliance  Ins.  Co.  587  B 

Fayerweather  v.  Phenix  Ins.  Co. 

41 1  A,  457 B 
Fayette  Co.  Ins.  Co.  v.  Neel  386 

Fayette  Mut.  Fire  Ins.  Co.  v.  Ful- 
ler 559,  560,  562 
Fayles  v.  National  Ins.  Co.  137 
F.  Dohmen  Co.  v.  Niagara  F.  Ins. 

Co.  30 

Team  v.  Ward  459  C 

Fearnley  v.  Lon.  Guarantee  Soc.   541a 
Feder   i.   Iowa   State   Traveling 

Men's  Ass'n  515  a 

Feeney  v.  People's  Fire  Ins.  Co.       590 
Feibelman  v.  Manchester  F.  Ass. 

Co. 
Feise  v.  Aguila 

V.  Parkinson 
Felix  V.  Grand  Lodge  A.  0.  U.  W. 

399  D 
Fell  V.  McHenry 
Felrath  v.  Schoiifield 
Fenn  v.  Craig 
V.  Lewis 

V.  N.  Orleans  Mut.  Ins.  Co. 
V.  Union  Central  L.  Ins.  Co. 

-   345 E,  399 D 
Ferdon  v.  Canfield  391 

Ferguson  v.  Mass.,  &c.  Ins.  Co.        398 
Fernandez  v.  Merchants'  Mut.  Ins. 

Co.  404 

Ferree  v.  Oxford  Fire  Ins.  Co.  380 

Ferrer  v.  Home  Mut.  Ins.  Co.    158,  589, 

590 
Ferriss  v.  N.  A.  Fire  Ins.  Co. 
Feshe  v.  Council  Bluffs 
Fessenden  v.  Great  West  Ins.  Co. 
Fidelity  &  Casualty  Co.  v.  Alpert 

158,  181 
V.  Ballard  14 


405 
30 

567 


552 
459  C 
67  M 

399  F 

77 


591 
249 

381 


593 


V.  Chambers 


631  A 


XXXVl 


TABLE   OF    CASES. 
[The  references  are  to  the  sections.] 


Section 


Fidelity  &  Casualty  Co.  v.  Eick 
hoff 
V.  Johnson 
V.  Lowenstein 
V.  Sittig 
V.  Teter 
V.  Waterman 
V.  Weise 
r.  Willey 


515a,  531  A 

517  A,  523  A 

531  A 

120 

324,  523  A 

325 

70  B 


403 
459 

303 


Fidelity  Mut.L.  Ass  n^..M.n^^^^^ 

i;.  Miller       156,  158,' 187,  298,  325 

3b4 
Field  V.  City  of  Des  Moines 

V  N.  Y.  Cent.  II.  U.  Co. 
Finch   V.  Modern   Workmen    of 

America 
Find.isen..MetropoleF.re^Ins^^,^ 

I^i^f>'-^y^«°^'"^^°-%)'506,553 
Finney  v.  Bedford  Com.  Ins.  Co.   472  E 

u.  Fairhaven  Ins.  Co.  4o2  E  j 

i;.  Warren  Ins.  Co.  ,ri  t^  ' 

Fire  Ass.  v.  Blum  4o2  i 

V.  Rosenthal  4rfo  A 

Fire  Ass'n  of  Phila.  v.  McNerney     4. o 

V.  Williamson  'A-ll,  m 

Fire  Ins.  Ass.  v.  Can.  Fire  &  Mar. 

Ins  Co  ^"^  " 

»,   Miller      '  30,  282  A,  589 

Fire  ins.  Co.  v.  Building  Ass.       ^^126, 

V.  Felrath  409  B  449  470 

V.  Merchants',  &c.  Trans.  Co.  95  A, 

408 

Fire  &  Mar.  Ins.  Co.  v.  Chesnut      131 
452  i! ,  by)z 

V.  iSIorrison 
Fireman's  Fund  Ins.  Co.  % 
staff 

V.  Pekor 
Fireman's  Ins.  Co.,  In  re 

V.  Holt 

c.  Powell 
Firemen's   Ins.  Co. 
Paper  Co. 

V.  Crandall 

V.  Floss  &  Co. 


Section 

Fischer  r.  Hope  Ins.  Co.      12,  568  569 

V.  Travelers'  Ins.  Co.  &^U  A 

Fish  V.  Cuttenet      18,  2o,  57,  64  13o  L 

Fishback  V.  Phenix  Ins.  Co.     143  o65, 

d/U,  O/^ 

Fisher  v.  Donovan  '^.^83 

V.  Metropolitan  Life  Ins.  Co.      oob 

Fitch  V.  Am.  Pop.  Life  Ins^  Co        lob, 

161,  185,  188,210,324,344  a 

Fitchburg  R.  R.  Co.  V    Charles- 

town  Mut.  Fire  Ins.  Co.         219,420 
Fitchburg  Savings  Bank  v.  Ama-    ^_ 
zon  Ins.  Co.  >l' 

Fitchner  v.  Fidelity  Mut.  F.  Ass  n  269^ 

Fitchnatrick  r.  Hawkeye  Ins.  Co.  504  A 
Fitt  V.  Fire  Ins.  Ass.  oo  -^ 

Fitton  v.  Accidental   Death  Ins. 

Co.  . 

i;.  Phoenix  Ass.  Co.  434 

Fitzgerald  v.  Conn.  Fire  Ins.  Co.  24J  H 
Fitzherbert  v.  Mather  12^  -l^ 

Fitzpatrickw.  Hartford  Life  &  Ann. 

Ins   Co.  ^-^8  ^'  ^P^ 

I  Fitzsimmons  w.  City  Fire  Ins.  Co.   4|^4, 

Flannagan  v.  Camden  Mut.  Ins. 

Co.  ,        .        **' 

Fleisch  1-.  Ins.  Co.  of  No.  America 

407  A,  477 

Fkm^ing   ..   Hartfo^g/i-/^-4,,B 
Fletcher  y.  ^tna  Life  Ins.  Co.  ^^^  2J|^, 

w.  Commonwealth  Ins.  Co.    81,  96 

loo,  2.<io 

V.  German-American  Ins.  Co.    462 

r.  N.  Y.  Life  Ins.  Co.    144  E,  5/8  a 


116,  267 
Buck- 

479 

70  B 

594 

365 

95 

K  Appleton 

240 

469  B 

70  B,  100  A, 279, 

469 

125 


Flindt  V.  Waters 
Flinn  v.  Headlaw 
Flint  V.  Ohio  Ins.  Co. 

V.  Railway  Co. 
Flynn  v.  Eq.  Life  Ass.  Soc. 
Mass.  Benefit  Ass'n 


350 

188  B 

44,  63,  340 

4.59 

123,  303 

187,  465, 

590 


591 

446 

,552 


412 


V.  Horton 
Firemen's,  &c.  Ins.  Co.  v.  Congre- 
gation, &c. 
First  Cong.  Church  v.   Holyoke 

M.  F.  Ins.  Co.  2..9  A,  240 

First  National  Bank  v.  American 

Central  Ins.  Co.  270  368^ 

469  (_/ 

^.Ins.  Co.ofN.  A.  252 

V.  Lancashire  Ins.  Co.  4^  ^ 


V.  Merch.  Mut.  Ins.  Co. 

U.N    A.  Ins.  Co. 
Fogg  V.  Griffin  _^^- 

V.  Middlesex  Mut.   Fire  Ins. 

Co.  145,  276,  379,  .385 

Folb  V.  Phoenix  Ins.  Co.  365 

Foley  V.  Manufacturers'  F.  Ins 

Co.  ^^  ^ 

V.  Royal  Arcanum  156,  287  B 

V.  Tabor  -^'/ 

Folger  V.  Columbian  Ins.  Co.  o.'- 

Follette  V.  U.  S.  Mut.  Ace.  Ass  n      187 
Follis  V.  U   S.  M.  A.  Ass'n  o-.l  A 

Folsom  r.  Belknap  Co.  Mut.  Fi.^ 
Ins.  Co.  .    269,447 

xxxvii 


TABLE  OF  CASES. 


[The  references  are  to  the  sections.] 


Folsom  V.  Brawn 

Foot  V.  yt^tna  Life  Ins.  Co. 


Section 

583 

144  G, 

156,  158 

Foote  V.  Hartford  Fire  Ins.  Co.         264 

Forbes  v.  Agawam  Mut.  Ins.  Co.    152, 

36'J,  506. 

V.  American  Ins.  Co.   222,  261, 420 

V.  Am.  Mut.  Life  Ins.  Co.       107  a, 

112,  336,  590 

V.  Aspinwall  30 

V.  Edinburgli  Life  Ass.  Co.       123, 

166,  200,  212,  297,  299, 

304,  353 

V.  Manufacturers'  Ins.  Co.     422  A 

V.  Union  Central  L.  Ins.  Co.  399  D 

Forbush  v.   Western   Mass.    Ins. 

Co.  191,  365 

Ford  V.  Buckeye  State  Ins.  Co.        577 
V.  U.  S.  Mut.  Ace.  Relief  Co.     523 
Forest  City  Ins.  Co.  v.  Hardesty       175 
I'.  School  Directors  464 

P'orgay  v.  Atlantic  Mut.  Ins.  Co.  452  E 
Forrester  v.  Mut.  Life  Ins.  Co.  572 

Forsyth  v.  Nat.  Life  Ins.  Co.  67 

Forward  v.  Continental  Ins.  Co.      151, 

267 
Forwood   V.    North    Wales    Ins. 

Co.  421  a 

Foster  v.  Gile  391 

V.  Mentor  Life  Ass.  Co.  584 

V.  U.  S.  Ins.  Co.  567 

V.  Van  Reed  458 

Foster  et  al.  v.  Eq.  Mut.  Fire  Ins. 

Co.  116,  276,  281,  378,  424 

Fourdrinier  v.  Hartford  Fire  Ins. 

Co.  190 

Fowkes  V.  Manchester  &  Lon.  Life 

Ass.  &  Loan  Assoc.       168,  176,  181, 

297,  573 

Fowle  V.  Springfield,  &c.  Ins.  Co.     288 

Fowler  v.  iEtna  Fire  Ins.  Co.   179, 181, 

257,  262,  587 

V.  Butterly  390,  895,  399  Q 

V.  Metropolitan  Life  Ins.  Co.    340, 

579  B 

V.  Mut.  Life  Ins.  Co.    314,  316,  321 

V.  N.  Y.  Indemnity  Ins.  Co.        74, 

100,  590 

V.  Old  North  State  Ins.  Co.        424 

V.  rhoenix  Ins.  Co.  477 

V.  Preferred  Ace.  Ins.  Co.  566 

V.  Scottish  Eq.  Ass.  &66,  567 

V.  Springfield,  &c.  Ins.  Co.  84 

Fox  V.   Masons'   Fraternal   Ace. 

Ass'n  306,  492 

V.  Penn  Mut.  Life  Ins.  Co.        108, 

109, 299 

r.  Pheni.x  Fire  Ins.  Co.  82, 256, 4.37 

Foy  r.  .Etna  Ins.  Co.  248,  580 

Fraiii  r.  Life  Ins.  Co.  667 

xxxviii 


Section 
France  v.  Mina  Life  Ins.  Co.   297, 305, 

477 
Francis  v.  Butler  Mut.  Fire  Ins. 

Co.  276,  378,  379 

V.  Ocean  Ins.  Co.  350,  505 

V.  Somerville  Mut.  Ins.  Co.      220, 

504 
Frane  v.  Burlington  Ins.  Co.  294  E 

Frank  v.  Mut.  Life  Ins   Co.  891  A 

Frankfurter  x.  Home  Ins.  Co.  369 

Frankle  i'.  Penn.  Fire  Ins.  Co.      360  A 
Franklin    v.   Atlantic    Ins.    Co.       143, 

370 
V.  Nat.  Ins.  Co.  384,  399  D 

Franklin     Brass     Co.  v.    Phoenix 

Ass.  Co.  222 

Franklin  Fire  Ins.  Co.  v.  Brock      239, 

277 
f.  Chicago  Ins.  Co.  191,240,511 
V.  Coates  93,  184,  283,  284,  469 
V.  Findlay  95,  274 

V.  Graver  221,  263  C 

V.  Hamil  2,  426,  431 

V.  Hellerick  222,  420 

V.  Howitt  424,  565 

V.  Louisville,  &c.  Packet  Co.  577 
V.  Martin  86,  145, 192,  247,  285 
V.  Taylor  23,  66 

V.  Updegraff  233,  420,  477,  504 
V.  Vaughan  288,  373 

Franklin  Ins.  Co.  v.  Chicago  Ice 

Co.  224 

V.  Colt  15,  23  C,  191 

V.  Culver  477 

V.  Drake  81,  365,  366 

(;.  Findlay  81 

?j.  Humphreys  407 

V.  Kepler  249  D 

V.  Massy  67,  151 

V.  Sears  67  L 

V.  Vaughan  373  A 

Franklin  Lite  Ins.  Co.  v.  Hazzard     398 
V.  Sefton  346,  398 

V.  Wallace  .  170 

Franklin  Savings  Inst.  v.  Central 

Ins.  Co.  379 

Fraser  v.  Home  L.  Ins.  Co.       360,  567 
Fraternal  Mut.  Life  Ins.  Co  v.  Ap- 

plegate  241.  392 

Frazer  r.  Gore  345  B 

Frederick,  &c.  Ins.  Co.  v.  Deford      371 
Fred.  J.  Kiesel  &  Co.  v.  Sun.  Ins. 

Co.  175 

Freedman  v.  Phila.  F.  Ass'n  305 

Freeland  v.  Per  Cent  Ins.  Co.       591  A 
Freeman  v.  Fulton  Fire  Ins.  Co.        74, 

590 

V.  Mercantile  Mut.  Ace.  Ass'n  298, 

517  A 

V.  Nat.  Benefit  Soc.     327  A,  563  A 


TABLE   OF    CASES. 


[The  references  are  to  the  sections.] 


Section 
Freeman  v.  People  320 

t'.  Travelers'  Ins.  Co.  531 

Freemausdorf  c.  Water  town  Ins. 

Co.  456  a 

French  v.  Connelly  573 

V.  Hartford  L.  Ins.  Co.  70  C 

V.  Hope  Ins.  Co.  79,  100 

V.  Lafayette  Ins.  Co.  478 

V.  Mutual  Reserve  Fund  L. 

Ass'n  70  C,  187 

V.  People  66 

Frey  v.  Mnt.  Fire  Ins.  Co.  562 

V.  Wellington  Ins.  Co.  488 

Fried  v.  Royal  Ins.  Co.     55, 58,  298, 565 

Friedlander  v.  London  Ins.  Co.         256 

Friedman  v.  Fennell  459  B 

Friegen  u.  Allemania  Fire  Ins.  Co.    269, 

287  C,  479 

Friesmutli  v.  Agawam  Mut.  Ins. 

Co.  189,  277,  290,  567 

Frink  v.  Hampden  Ins.  Co.       379,  446, 

448 
Frisbie  v.  Fayette  Mut.  Ins.  Co.       161, 

191,  2.36 
Froehlicli  v.  Atlas  Life  Ins.  Co.  362 
Froelily  v.  North  St.  Life  Ins.  Co.  591  A 
Fromherz  v.  Yankton  F.  Ins.  Co.  125 
Frost  V.  Liverpool,  &c.  Ins.  Co.  27 

V.  Saratoga  County  Mut.  Ins. 

Co.  258,  502,  555 

Frost's  Detroit  Lumber  Works  r. 

Miller's  Mut.  Ins.  Co.  225,  245 

Fry  V.  Charter  Oak  Life  Ins.  Co.       63 
V.  Lane  399  D 

Fuchs  V.  Germantown  F.  M.  Ins. 

Co.  70  a 

Fullam  V.  N.  Y.  Union  Ins.  Co.    478, 488 

Fuller  V.  Boston  Mut.  Fire  Ins.  Co.   15, 

31,  376,  425,  501 

V.  Detroit  Fire  and  M.  Ins. 

Co.  460 

V.  Madison  Ins.  Co.         23,  43,  552 

V.  Phoenix  Ins.  Co.  294  C,  507 

Fulton  V.  Lancaster  Ins.  Co.  567 

Fulton  Ins    Co.  r.  Metropolitan 

Life  Ins.  Co.  172  A 

V.  Milner  179  A,  424  A 

Funke  v.  Minn.  Farmers'  Mutual 

Fire  Ins.  Ass.  365  B 

Furness  v.  Sherwood  594 

Fiirniss  v.  Mut.  Life  Ins.  Co.  299 

Furtado  v.  Rodgers  36,  39 


G. 


Gabay  v.  Floyd  179  C 

Gahagan  v.  Union  Mut.  Ins.  Co.      290, 

292  B 
Galbraith  v.  Arlington  Ins.  Co.     133  B 


Section 
Gale  V.  Belknap  County  Ins.  Co.     365, 

365  B 

V.  Lewis  132,  396 

V.  State  Ins.  Co.  4'i5 

Gales  V.  Hail  man  454 

Gallant  v.  Met'n  L.  Ins.  Co.  187 

Gallin  v.  Lon.,  &c.  Ry.  Co.  529 

Galloway  v.  Craig  391 

V.  Standard  F.  Ins.  Co.      55  A,  66 

Galyon  v.  Ketclien  456 

Gamba  v.  Le  Mesurier  36 

Gamble  v.  Ace.  Ins.  Co.  465,  536 

Gambs  v.  Covenant  Life  Ins.  Co. 

107  h,  391 
Gamwell    r.   Merch.    &    Farmers' 

Mut.  Fire  Ins.  Co.  247,  248 

Gandy  v.  Orient  Ins.  Co.  368,  434 

Ganong  i'.  ^tna  Ins.  Co.  466 

Cans  V.  St.  Paul,  &c.  Ins.  Co.  504 

Ganser  v.  Fireman's  Fund  Ins.  Co.  577 
Garber  v.  Globe,  &c.  Ins.  Co.    339,  501, 

507 
V.  Mut.  Life  Ins.  Co.  346 

Garcelon  v.  Hampden  Fire  Ins. 

Co.  181  F,  184,  250 

Gardiner  I'.  Croasdale  421a 

V.  Piscataqua  Mut.  Fire  Ins. 

Co.  220.  553,  555 

Gardner   v.  Union  Central  Life 

Ins.  Co.  342  A 

Garlick   v.   Mississippi,  &c.   Ins. 

Co.  341a 

Garner  r.  Gerniania  Ins.  Co.       399  O, 

399  P 

V.  Moore  108 

Garretson  r.  Hawkeye  Ins.  Co.        488 

Garrett  r.  Prov.  Ins.  Co.  ^  199 

Garver  v.  Hawkeye  Ins.  Co.  277, 

287  B 
Gaskarth  v.  Law  Un.  Ins.  Co.  412 

Gaskin  v.  Plioenix  Ins.  Co.  273 

Gasner  v.  Met.  Ins.  Co.  223 

Gatayes  v.  Fiather  399  B 

Gates  V.    Madison   County  Mut. 

■  Ins.  Co.  184,  207, 210,  225,  241, 
247,  269,  408 
V.  Smith  456 

Gauche  i".  London  &  Lancashire 

Ins.  Co.  455,  469  B,  475,  493 

Gaunt  v.  Am.  Cent.  Ins.  Co.  11 

Gauthier  v.  Waterloo  Ins.  Co.  59,  365 
Ga}'-  V.  Union  Mut.  Life  Ins.  Co.  307, 
316,  318 
Gaylord  v.  Lamar  Fire  Ins.  Co.  287 
Geach  v.  Ingall  201,  298 

Gee  V.  Cheshire,  &c.  Ins.  Co.  365 

Geib  r.  International  Ins.  Co.  143, 

144  A,  216,294  0,  497,  501 
Geisek  v.  Crescent  Mut.  Ins.  Co.  404 
Gelatly  v.  Minn.,  &c.  Soc.  465 

xxxix 


TABLE   OF   CASES. 


Gen.  Int.  Ins.  Co.  v.  Ruggles 

Gen.  I\Iut.  Ins.  Co.  v.  Phillips 
r.  Slierwooil 

Genesee  Mat.  Ins.  Co.  v.  West- 
man 

George  v.  Goldsmiths',  &c.  ins. 
Ass'n 

George  and  Goldsmiths  and  Gen- 
eral Burglary  Ins.  Ass'n,  Lim'd 
In  re 

Georgia  Home  Ins.  Co.  v.  Allen 
151. 


[The  references  are  to  the  sections.] 

German  Ins.  Co.  v.  Read 


Section 
122, 

407  A 
577 
417 


563 
404 


11.  Rounds 
V.  tSeibert 
V.  Ward 
V.  York 
German    Ins. 
Kline 


V.  Bartlett 
V.  Brady 
r.  Hall 
r.  Jacobs 
V.  Kinnier 


126, 

263  A 

269 

287  B 

109  rt,  269,  279 

177,  233,  289 B,  488 

151,266,  269  o,  445, 

468,  497 

Georgia  Ins.  Co.  v  Dawson  454 

Georgia  Masonic  Ins.  Co.  v.  Davis    478 
Georgia,  &c.  Life  Ins.  Co.  v.  Gib- 
son 362,  502  a 
Gere  v.  Council  Bluffs  Ins.  Co.   423  A, 

493 

Gerhard  v.  Bates  570 

Gerhauser  v.  North  B.  &  M  Ins. 

Co.    185,  187,  200,  250,  262,  373,  375, 

443,  477 

Gerlach  v.  Amazon  Ins.  Co.  134 

Gerling  v.  Agricultural  Ins.  Co.      267, 

269,  291  A,  469  C 

German-Am.  Ins.  Co.  v.  BuckstafE     248 

V.  Commercial  Fire  Ins.  Co.      420 


V.  Davidson 
V.  Etlierton 
r.  Hart 
r.  Hocking 
v.  Humphrey 
V.  Norris 
Steiger 


81,  469 

492 

144  A,  285 

479 

126,  270 

466 

253,  263  C 


German  Fire  Ins.  Co.  v.  Carrow  133  A 

V.  Commissioners  239  A 

V.  Fairbank  189 

V.  Frazier  170 

V.  Grunert  465,  504  A 

V.  Gunten  423  B 

V.  Hick  294  E 

v.  Roost  412 

German  Ins.  Co.  ?'.  Brown  465 


Davis   248,  465,  469  D,  479,  566 

r.  Fddy  421  a 
V.  First  Nat.  Bank  of  Boon- 

ville  578  a 

V.  Frederick  452  F 

V.  Gray  126,  151 

V.  Harden  365 

!;.  Heiduk  369 

V.  Ilyman  287  B 

V.  Penrod  126,  247,  380 

xl 


Section 

159 

67,  126,  380 

469  C 

504  A 

269 

&    Sav.  Inst'n   v. 

285,  469  C 
German  M.  Ins.  Co.  v.  Niewedde  452  F 
German   Nat.  Bank  v.  Agr.  Ins. 

Co.  ^^^ 

German,  &c.  Ins.  Co.  v.  Davis  566 

Germania  Fire  Ins.  Co.  i'.  Boykin 

440,  465 
V.  Curran  448,  476,  590 

V.  Francis  239 

V.  Hick  133  A,  20 

V.  Home  Ins.  Co.  267,  279 

V.  Klewer  249  I,  365  B 

V.  McKee  1'13,  497 

Germania  Ins.  Co.  v.  Rudwig  156, 159, 

502 
V.  Sherlock  408,  417 

Germania  Life  Ins.  Co.  v.  Lunken- 

heimer  p^^ 

Germond  v.  Home  Ins.  Co.  267 

Gerrish  i'.  German  Ins.  Co.       565,  566 
Getchell  r.  iEtna  Ins.  Co.  424 

V.  Maney  _         389 

Gettelman  v.  Commercial  Union 

Ass.  Co.  281  B,  379 

Gettworth  v.  Teutonia  Ins.  Co.        428 
Ghio  V.  Western  Ass.  Co.  478 

Gibb  V.  Phila.  F.  Ins.  Co.  269,  449,458 
Gibbs  V.  Continental  Ins.  Co.        249  D 
V.  Richmond  Co.   Mut.  Ins. 

Co.  510 

Gibson  V.  Am.  Mut.  Life  Ins.  Co.    304, 

325,  467,  587 

?,'.  Conn.  F.  Ins.  Co.  30,  66  A 

t'.  Farmers',  &c.  Ins.  Co.  251 

V.  Imperial  Council  of  Order 

of  United  Friends  399  F 

Giddings  v.  N.  W.  Mut.  Life  Ins. 

Co.  56 

Gier  v.  Western  Ass.  Co.-  469  C 

Giffard  v.  Phoenix  Ins.  Co.  70  B 

V.  Queen  Ins.  Co.         45  a,  190,  445 

Gilbert  v.  Moose  HO,  112 

V.  National  Ins.  Co.  590 

V.  N.  A.  Fire  Ins.  Co.  267,  465,  475 

Gill  V.  Can.  Fire  and  Mar.  Ins.  Co.  83a 

Gilleland  v.  Martin  465 

Gillett  V.  Burlington  Ins.  Co.  589 

V.  Liverpool  L.  &  G.  Ins.  Co.     365 

Gilliat  V.   Pawtucket    Mut.   Fire 

Ins.  Co.  157, 171,  247,  249  B,  282,  502 
Gilman  v.  Curtis  398 

V.  Dwelling-Honse  Ins.  Co.  86 

Gilson  V.  Delaware  &  Hudson  Ca- 
nal Co.  402,  412 


TABLE   OF   CASES. 


[The  references  are  to  the  sections.] 


Section 
Girard  Agr.,  &c.  Co.  v.  Merchants' 

Lite  Ins.  Co.  469 

Girard  Fire    &  Mar.  Ins.  Co.    v. 

Stephenson_  207,  '^15  «,  223,  229 

Girard  Fire    ins.  Co.  v.  Hebbard    282, 

387 

Girard,  &c.   Ins.  Co.  (.•.  Mut.,  &c. 

Ins.  Co.     345  a,  346,  356,  356  A,  358, 

360,  360  F,  361,  465,  469,  469  B 

Girdleston  v.  N.  B.  Mar.  Ins.  Co.     839, 

668 

Given  v.  Rettew  557 

V.  Wis.  O.  F.  M.  L.  Ins.  Co.    399  N 

Givens  v.  liivers  108 

V.  Veeder  83 

Gladding  v.  Cal.   Farmers'  Mut. 

Fire  Ins.  Ass.  511 

Glade  v.  Germania  Fire  Ins.  Co.  292  B 
Gladstone  v.  King  122,  201 

Glanz  V.  Gloeckler  399  A 

Glass  V.  Walker  478 

Glaze  V.  Three  Rivers  Farmers' 

M.  F.  Ins.  Co.  81,  287  B 

Glen  y.  Hope  Mut.  Life  Ins.  Co.       11 
V.  Lewis  223,  245 

Glendale  Manuf.  Co.  v.  Prot.  Ins. 

Co  251 

Glendale  Woolen  Co.  v.  Protec- 
tion Ins.  Co.  183 
Glens  Falls  Ins.  Co.  v.  Hopkins         125 
V.  Judge  of  Jackson  Circuit 

Court  578 

Glens  Falls  Portland  Cement  Co. 

V.  Travellers'  Ins.  Co.  2 

Globe  Ins.  Co.,  In  re  594 

V.  Boyle  80,  445 

V.  Reals  573 

V.  Sherlock  421 « 

Globe  Mut.  Life  Ins.  Co.  v.  Wolff    511 

Globe  Reserve  Mut.  L.  Ins.  Co. 

V.  Duffy  187 

Gloucester  Manuf.  Co.  v.  Howard 

Ins.  Co.         43,  60,  129,  130,  136,  171 
Glover  v.  National  F.  Ins.  Co.  247 

Godchaux  c.  Merchants'  Mut.  Ins. 

Co.  452  F 

Goddard  v.  East  Texas  F.  Ins.  Co.  263  A 

V.  Ins.  Co.  158,  175 

V.  Monitor  Mut.  Fire  Ins.  Co.     51, 

56,  141 

Goddart  v.  Garrett  67  M,  75  A 

Godfrey  v.  New  York  L.  Ins.  Co.      151 

Godsall  V.  Boldero  100,  115,  116 

Goetzman  v.  Conn.,  &c.  Ins.  Co.        329 

Goit  V.  Nat.  Protection  Ins.  Co.  67, 134, 

360,  386 
Gold  V.  Sun  Ins.  Co.  23  A 

Gold  Mining  Co.  v.  Natl.  Bank       23  D 
Golden  Rule  v.  The  People  75  B 

Golden  Star  Fraternity  v.  Martin        2 


Section 
Goldin  V.  Northern  Ass.  Co.  125 

Goldman  v.  North  British  &  Merc. 

Ins.  Co.  263  A 

GoldscJimidt  r.  Mut.  Life  Ins.  Co.  325, 

585 

Goldsmith  v.  Gore  Dist.  Ins.  Co.       475 

V.  Union  Mut.  Life  Ins.  Co.      566, 

566  B 

Goldstone  v.  Osborne         492,  493,  495 

Goldwater  v.  Liverpool  &  L.  &  G. 

Ins.  Co.  372  A 

Good  V.  Buckeye  Mut.  Fire  Ins. 

Co.  434 

Goodall  V.  New  England  Fire  Ins. 

Co.  24,  45,  438,  448 

Goode  V.  Georgia  Home  Ins.  Co.     151, 

368,  369 

Gooden  v.  Amoskeag  Fire  Ins.  Co.  485 

Goodfellow  V.  Times  &  Beacon  Ins. 

Co.  69 

Goodhue  v.  Hartford  F.  Ins.  Co.  263  E, 

497 
Goodman  v.  Cohen  492 

V.  Harvey  410 

V.  Mercantile  Credit  Guaran- 
tee Co.  2 
Goodrich's  Appeal  594a 
Goodrich  v.  Treat  391 
Goodson  V.  Brooke  138  A 
Goodwin    v.    Lancashire    Fire   & 

Life  Ins.  Co.         67,  215  a,  469 

V.  Mass.  Mut.  Life  Ins.  Co.       107, 

344  c,  469  a 

V.  Provident  Savings  L.  Ass'n    66, 

159,  478 

Gordon  v.  Ingram  449 

V.  Lon.  Ass.  Co.  13 

V.  Mass.  Ins.  Co.  268 

V.  Parmelee  583 

V.  Rimmington  407 

V.  U.  S.  Casualty  Co.  524 

i".  Ware  Savings  Bk.  452  B 

Goring  v.  Lon.  Mut^  Fire  Ins.  Co.     159 

Gorman  v.  Hand-in-Hand  Ins.  Co.    420 

Gortan  v.  Dodge  Co.,  &c.  Ins.  Co.     358 

Gosling  V.  Caldwell  391 

Goss  V.  Citizens'  Ins.  Co.  239 

Gotleib  V.  Cranch  449 

Gottsman  v.  Ins.  Co.  189,  277,  291 

Gouinlock    v.   Manuf.    &    Merch. 

Mut.  Fire  Ins.  Co.  166 

Gould  V.  Brit.  Am.  Ass.  Co.  247 

V.  Dwelling-House  Ins.  Co.        138, 
270,  379,  469  C 
V.  Emerson  .391,  392 

V.  Holland  Purchase  Ins.  Co.     294 
?'.  York  County  Mut.  Fire  Ins. 

Co.  189,  277.  285 

Gnulstone  ".  Royal  Ins.  Co.  81,  92 

Gourdon  v.  Ins.  Co.  of  N.  A.  393 

xli 


TABLE   OF   CASES. 


[The  references  are  to  the  sections.] 
Section 


Gove  V.  Farmers'  Mut.  Fire  Ins. 

Co. 
Govern  v.  Littlcfleld 
Grable  v.  German  Ins.  Co. 
Grace  v.  Adams 

V.  Am.  Central  Ins.  Co. 


408 

•2.5 

287  B 

457  B 

67,  67  I, 

574 

V.  Koch  359  F 

Grady  v.  Am.  Central  Ins.  Co.  154 

Graham  v.  American  F.  Ins.  Co.         72, 

285,  294  E 

V.  Barras  1"'^ 

V.  Fire  Ins.  Co.  151 

V.  Firemen's  Ins.  Co.  185,  448,  463 

V.  Niagara  Fire  Ins.  Co.  479 

Grand  Lodge  v.  Belcliam  299 

j;.  Child  399^0 

V.  Wieting  324 

Grand  Kapids  Hydraulic  Co.   v. 

American  F.  Ins.  Co.  2-39  A 

Grandin  v.  Ins.  Co.         172  A,  175,  177, 

287  C 

Grange  Mill  Co.  v.  The  People    452  A 

V.  Western  Ass.  Co.      87  A,  399  D, 

469 

Granger  ?•.  Howard  Ins.  Co.  590 

Granger's  Life,   &c.  Ins.  Co.    v. 

Brown  214 

Grant  v.  iEtna  Ins.  Co.  424 

V.  Ala.  Gold  Life  Ins.  Co.     356  A, 

399  A 

V.  Eliot,  &c.  Mut.  Fire  Ins.  Co.  264, 

266 

V.  Howard  Ins.  Co.      224,  225,  241 

«;.  Lexington    Fire,    Life,    & 

Mar.  Ins.  488,  505 

V.  Parkinson  79 

V.  Heliance  Ins.  Co.  59,  67,  69 

Grant's  Adm'rs  v.  Kline  108 

Grattan  v.  Met'n  Ins.  Co.     295, 303, 306 

Graves   v.    American    Live-stock 

Ins.  Co.  449 

V.  Boston  Mar.  Ins.  Co.  566 

V.  Merchants'  &  Bankers'  Ins. 

Co.  138,  287  B,  469  C 


V.  Wasii.  Mar.  Ins.  Co. 
Gray  v.  Germania  F.  Ins.  Co. 


469,  488 

345  E, 

369,  497 

465 

172  A 

397 

591  A 

567 


V.  Guardian  Ass.  Co. 
V.  Harper 
V.  Murray 
V.  Nat.  Ben.  Ass. 
V.  Sims 

V.  Supreme  Lodge  K.  of  H.  563  A, 
566  A 
Great  Falls  Mut.  Fire  Ins.  Co.  v. 

Harvey  552 

Great  Western  Ins.  Co.  v.  Staaden  465 
Greaves    v.   Niagara  Dist.  Mut. 
Fire  Ass.  Co.  475 

xlii 


Section 

Greek  v.  Royal  Ins.  Co.  208 

Greeley  v.  Iowa  St.  Ins.  Co.  562 

Green  v.  Brand  269 

V.  Green  448 

V.  Holway  25 

V.  Homestead  Ins.  Co.  292 

II.  Ingham  395 

V.  Liverpool,  &c.  Ins.  Co.  21,  401a, 

420 

V.  Merchants'  Ins.  Co.  215  D 

V.  Northwestern  Live    Stock 

Ins.  Co.  360,  547 

V.  Republic  Ins.  Co.  386 

Greene  v.  Lycoming,  &c.  Fire  Ins. 

Co.  126,  360 

Greenfield  v.  Mass.  Life  Ass.  Co.  344  c 
Greenleaf  v.  St.  Louis  Ins.  Co.  101 

Greenlee  v.  Iowa  State  Ins.  Co.      257, 

294  E 
V.  Nortli  British  and  Mercan 
tile  Ins.  Co. 
Grcenwald  v.  Ins.  Co. 
Greenwich  Ins.  Co.  v.  Raab 
f.  Sabotnick 
V.  Union  Dredging  Co. 
V.  Waterman 


405 
413 

408 
365 
349  B 
151,578  a 


403, 


151, 


Greenwood  v  N.  Y.  Life  Ins.  Co.  29  B, 

137  A 
Greenwood   Ice    Co.    v.    Georgia 

Home  Ins.  Co.  137,  452  F 

Gregg  V.  Wells  502 

Grevemeyeri?.  Southern  Mut.  Ins. 

Co.  93 

GriflFey  v.  N.  Y.  Central  Ins.  Co.   67  J, 

379 

GrifSn  v.  Ranney  25 

r.  Western  Mut.  Ass.  327  A 

Griffith  V.  New  York  L.  Ins.  Co.      360, 

399  D 
Grim  v.  Phoenix  Ins.  Co.  411  A 

Grimes  v.  Northwestern  Legion  of 

Honor  156 

Gristock    v.   Royal    Ins.    Co.     144  D, 

294  E 

Griswold  V.  Am.  Cent.  Ins.  Co.         379 

V.  Sayer  399  D 

V.  Waddington  36,  37,  350 

Gros  c.  Le  Nord  365 

Gross    r.  Milwaukee   Mechanics' 

Ins.  Co.  222,  420 

Grosvenor  v.  Atlantic  Mut.  Ins. 

Co.  227,  379 

Grove  i".  Bastard  568 

Grubbs  v.  North  Carolina  Home 

Ins.  Co.  138,  369 

Guardian  Mut.  Life  Ins.   Co.  v. 

Hogan  107,  398 

Guernsey  v.  Am.  Ins.  Co.   446,  502  a, 

508,  511 

Guest  V.  Fire  Ins.  Co.  82,  285,  365 


TABLE   OF   CASES. 


[The  references  are  to  the  sections. 


Section 
Guggisberg  v.  Waterloo  Mut.  Ins. 

Co.  67 

Guiltinan  v.  Met'n  L.  Ins.  Co.  30(5 

Guinane  v.  Hope  Mut.  Life  Ins. 

Co.  181 

Guiterman    v.  German-American 

Ins.  Co.  1J2,  459E 

Gulf  City  Ins.  Co.  v.  Stephens  580 

Gulnare,  The  94  A 

Gunther   v.   Liv.,  Lon.,  &  Globe 

Ins.  Co.  227,  239  A 

Guy  V.  Globe  Ins.  Co.  594  a 

Gwinlock  I'.  Manuf.  &  Mech.  Mut. 

Fire  Ins.  Co.  1G6 


H 


H.  &  B.  Ins.  Co.  V.  Garlington       421  a 
Haas  r.  Montauk   Fire  Ins.  Co.     136, 

502 
Hackney   r.    Alleghany    County 

Mut.  Ins.  Co.  133,  148,  552 

Hadley  v.  N.  H.  Fire  Ins.  Co.  143,  372, 

45B 
Haenschen  v.  Franklin  Ins.  Co.  425 
Haff  V.  Mar.  Ins.  Co.  474 

Hagan  i-.  Scottish  Union  &  Nat'l 

Ins.  Co.  177 

Hagedorn  v.  Oliverson  447  B 

Halm  V.  Corbett  417  A 

V.  Guardian  Ass.  Co.   151,  .369,  405 

Haider  v.  St.  Paul  F.  &  M.  Ins, 

Co.  287  B 

Haigh  V.  Brooks  452  F 

I'.  I)e  la  Cour  30 

Haight  r.  Continental  Ins.  Co.      249  I, 

276  C 
Haines  v.  Republic  Fire  Ins.  Co.     373, 

587 

Haire  v.  Ohio  Farmers'  Ins.  Co.        364 

Halbrook  v.  Brown  420  A 

Hale  V.  Continental  Life  Ins.  Co.  352  A 

V.  Ins.  Co.  378  A 

V.  Life  Indemnity  Co.       112,  325, 

459  E 

V.  Mechanics'  Mut.  Ins.  Co.       146, 

369,  .382,  510 

V.  Union  Mut.  Fire  Ins.  Co.   383, 

502 
Haley  v.   Dorchester   Mut.    Fire 

Ins.  Co.        166,  207,  210,  2.39, 

435,  438 

V.  Manuf.  Fire  Ins.  Co.  424 

Halford  v.  Kymer  103, 104^  105 

Hall  V.  Association  452  I) 

V.  Concordia  F.  Ins.  Co.  304 

V.  Dorchester  Ins.  Co.  386 

V.  Ins.  Co.  of  N.  A.  239 

V.  Nash.  &  Chat.  R.  R.  Co.         454 


Section 

Hall  V.  Niagara  F.  Ins.  Co.       8.3,  83  a, 

285,  287  B,  291  A,  379 

V.  People's  Mut.  Fire  Ins.  Co.    191 

200,  258,  259,  490,  501 

Hallock  V.  Insurance  Co.  58,  345  B 

V.  Jaudin  25 

Halsey  v.  Adams  67 

i\  Patterson  399  C 

Hamberg  v.  St.  Paul  F.  &  M.  Ins. 

Co.  469  C,  477 

Hamblet  r.  City  Ins.  Co.  60,  213 

Hambleton  v.  Home  Ins.  Co.  360  F,  508 
Hambro  v.  Hull,  &c.  Ins.  Co.  591  A 
Hambrough  v.  Mutual  L.  Ins.  Co.  158, 

298 
Hamilton  v.  Dwelling-House  Ins. 

Co.  287  B 

V.  Home  Ins.  Co.  133  A,  494 

r.  Liverpool,  &c.  Ins.  Co.  494 

V.  Lycoming  iMut.  Ins.  Co.    16,  19, 
47,  53,  565 
V.  Mendes  115 

V.  Mutual  Life  Ins.  Co.      39,  39  A, 
40,  350,  .360 
V.  Phoenix  Ins.  Co.  492 

Hamilton  IMut.  Ins.  Co.  v.  Hobart    552 
V.  Parker  560 

Hamlyn  v.  Crown  Ace.  Ins.  Co.  517  A 
Hamm  Realty  Co.  v.  New  Hamp- 
shire F.  Ins.  Co.  126 
Hammel  v.  Queen  Ins.  Co.  274,  446, 
449,  566 
Hammer  v.  Johnson  456 
Hammond  v.  American  Mut.  Life 

Ins.  Co.  349 

Hancock   v.  American  Life  Ins. 

Co.  465,  585 

V.  New  York  Life  Ins.  Co.     39,  40, 

3.50,  568 

Hancox  v.  Fishing  Ins.  Co.  93  A,  179  A 

Hand  v.  National  Live-Stock  Ins. 

Co.  30,  589 

V.  Williamsburgh  Ins.  Co.  447 

Handy  v.  Dobbin  459  F 

Hanger  v.  Abbott  39  A,  350 

Hankins  v.  Rockford  Ins.  Co.  294,  294  F 

Hann  v.  National  Union  187 

Hanna  v.  Amer.  Ins.  Co.  469  C 

V.  Andes  Ins.  Co.  442 

V.  Conn.  Mut.  L.  Ins.  Co.   299,  465 

Hannan  v.  Williamsburgh  City  F. 

Ins.  Co.  247 

Hanover  F.  Ins.  Co.  v.  Bohn       72,  449 
V.  Brown  274,  276  C 

V.  Connor  270,  459  F 

V.  Crawford  263  A 

V.  Johnson  460 

V.  Lewis  279 

V.  Mannasson  420 

V.  Stoddard  80,  239  A 

xliii 


TABLE   OF  CASES. 
[The  references  are  to  the  sections.] 


Section 
Hansconi  r.  Home  Ins.  Co.  ^247 

llaiist'ii  r.  American  Ins.  Co.  133  B 
Hanson  r.  Milwaukie,  &c.  Ins.  Co.  159 
Hanlie  r.  St.  Louis  Mat.  Life  Ins. 

Co.  65 

Ilanlin.u'  v.  Carter  584 

V.  isWwicli     Union    F.    Ins. 

Society  126,  151 

V.  Kandall  185 

V.  Townsliend  455 

Hanlwick  v.  State  Ins.  Co.  14 

Hardy  r.  Lancashire  Ins.  Co.    177,  449  , 
V.  Union  Mat.  Fire  Ins.  Co.  I 

206,  258,  365,  365  B  ' 
Hare  r.  Barstow  420  | 

Harkins  v.  Qiiincy  Mut.  Ins.  Co.      474, 

475 
Harl  V.  Pottavvattoniie  Co.  Mnt. 

Fire  Ins.  Co.  502,  5fi3  A 

Harley  r.  Heist  399  _N 

Harnian  c.  Kingston  350 

I'.  Lewis  399  B 

Harnden   v.   Milwaukee   M.  Ins. 

Co.  126,  465.  469  D 

Harnickel  v.  New  York  Life  Ins. 

Co.  53 

Harp  V.  Granger  Mut.  Fire  Ins. 

Co.  43  H 

Harper  v.  Albany  Mut.  Ins.  Co.        239 

V.  City  Ins.  Co.     179,  239,  415,  416 

V.  Clark  25 

V.  riioenix  Ins.  Co.  327 

Harriman  v.  Queen's  Ins.  Co.       421  a, 

469 
Harrins;ton  r.  Fitchburg  Ins.  Co. 

249  D,  452  D 
V.  Trader's  Bank  390 

Harris   v.  Columbian   Mut.  Ins. 

Co.  239,  566 

V.  Eagle  Ins.  Co.  31 

V.  Eq.,  &c.  Ass.  Co.     362,  506,  573, 

575 

V.  Gasper  Fire  &Mar.  Ins.  Co. 

4.52  B 
V.  Ohio  Ins.  Co.  -364,  365 

V.  Phoenix  Ins.  Co.      466,  468,  487 
V.  Prot.  Ins.  Co.  434,  476 

r.  Royal  Canadian  Ins.  Co.       219, 
401  a 
i\  Travellers'  Ins.  Co.  518 

V.  Waterloo  Mut.  Fire  Ins.  Co.  277 
V.  York  Mut.  Ins.  Co.  81,  403 

Harris's    Case,    In    re   Imperial 

Land  Co.  48 

Harrison  v.  City  Fire  Ins.  Co.  138.  248 
V.  Hartford  F.  Ins.  Co.  126,  469  I), 
494 
r.  Masonic  Mut.  Ben.  Society   465 
V.  McConkey  388 

t^.  Pepper  448 

xliv 


Section 
Hart  I'.  Achilles  548 

V.  British,  &c.  Ins.  Co.  215  A 

V.  Citizens'  Ins.  Co.  478 

V.  Niagara  F.  Ins.  Co.  177,  285 

V.  Standard  Mut.  Ins.  Co.      420  A 
V.  Western  R.  R.  Co.  94,  453,  454, 

459 
Hartford  Fire  Ins.  Co.  v.  Bonner 

Mercantile  Co.  492 

V.  Davenport  192,  889,  446 

V.  Farrish  23 

V.  Kahn  589 

V.  Keating  72,  138,  276  C,  448 

V.  McLemore  368 

V.  Reynolds  122,  124  A 

V.  Ross  280 

V.  Walsh  70  a,  189,  190 

V.  Webster  129 

Hartfon:  Ins.  Co.  v.  Haas  133  A,  144  B 

r.  Kansas  70  a,  577 

V.  Pennell  454 

V.  Reynolds  67  F 

V.  Wilcox  23 

Hartford  L.  A.  Ins.  Co.  r.Unsell      340 

Hartford  Life  Ins.  Co.  v.  Gray  159 

Hartford   Live  Stock  Ins.  Co  v. 

Mathews  477,  547,  575,  577 

Hartford  Prot.  Ins.  Co.  r.  Harmer  101, 
285,  580,  582 
Hartford   Steam  Boiler  Insp.  & 

Ins.  Co.  V.  Cartier  67,  200 

V.  Lasher  Stocking  Co.  55  A,  276, 

412 

Hartigan  r.  Int.  Life  Ass.  Co.  298 

Hartman  v.  Conn.,  &c.  Ins.  Co.         312, 

325 
Hartmann  v.  Kevstone  Ins.  Co.       195, 
'212,306,  317,32.3,580 
Hartney  v.  North  British  Fire  Ins. 

Co.  263  D 

Hartshorne  v.  Agricultural  Ins. 

Co.  294  A 

Harvey  v.  Cherry  86 

Haskell's  Case  320 

Haskins   v.   Hamilton  M-ut.   Ins. 

Co.  430,  591 

Hastie  ?>.  De  Peyster  10,  11 

Hastings  v.  Brooklyn  L.  Ins.  Co.      357 

V.  Westchester  Fire  Ins.  Co.      369 

Hastings   Mut.  Fire  Ins.   Co.   v. 

Shannon  143 

Hatch  V.  Metropole  Ins.  Co.        447  A, 

459  D 
'  V.  Mutual  Life  Ins.  Co.  329 

V.  New  Zealand  Ins.  Co.         420  A 
Hathaway  c.  ]\lutual  L.  Ins.  Co.  356  A 
V.  Nat.  Life  Ins.  Co.  320 

V.  Sherman  392 

V.  State  Ins.  Co.  280 

V.  Trenton  Mut.  Life  Ins.  Co.    338 


TABLE    OF   CASES. 


[The  references  are  to  the  sections.] 


Section 
Hathorn  v.  Germania  Ins.  Co.  67,  574 
Hatton  I'.  Beacon  Ins.  Co.  365,  384 

V.  Provincial  Ins.  Co.  479,  488 

Haughton  v.  Ewbanlc  138  A 

Haupt  V.  Plioeni.x  Ins.  Co.  340 

Havens  v.  Germania  F.  Ins.  Co.         30 
V.  Home  Ins.  Co.  247,  277 

Ilaverliill  Ins.  Co.  v.  Prescott   555,  577 
Haverstick  v.  Penn.  Twp.  Mut. 

F.  Ins.  Ass'n  557 

Hawes  v.  N.  E.  Ins.  Co.  680 

Hawke  v.  Niagara  Dist.  Mut.  Fire 

Ins.  Co.  58,  59 

Hawkes  v.  Dodge  Co.  Mut.  Ins. 

Co.  249,  292 

Hawkins  v.  Coulthurst  39U  B 

Hawley  v.  Liverpool,  &c.  Ins.  Co.  67  L, 

261) 
V.  Michigan  Mut.  L  Ins.  Co.  55  A, 

357 
Haws  V.  Fire  Ass.  401  C 

Hay  V.  Star  Fire  Ins  Co.  479,  566 

Hayes  v.  Milford  M.  F.  Ins.  Co.        72, 
365,  492 
V.  Un.,  &c.  Ins.  Co.  46-5,  477 

Haynie  v.  Knights  Templars'  L. 

Ind.  Co.  327 

Haynor  v.  American,  «&c.  Ins.  Co.     358 
Hays  V.  Lycoming,  &c.  Ins.  Co.  459  F, 

550 
Hayward  v.  Cain  455 

V.  Fulcher  592 

V.  Liverpool,  &c.  Ins  Co.  239,  415 
V.  National  Ins.  Co.  143,  370,  372 
V.  N.  E.  Mut.  Ins.  Co.  290.  292  B 
V.  Northwestern  Ins.  Co.  239,  415 
Hazard  i'.   Canada   Agricultural 

Ins.  Co.  385,  456 

V.  Franklin    Mut.    Fire    Ins. 

Co.  264,  554 

V.  N.  E.  Mar.  Ins.  Co.  179  A 

Hazen  v.  Mass.  Mut.  L.  Ins.  Co.     69  a, 

399  q 
Hazl:?  V.  Council  Bluffs  Ins.  Co.  349  B 
Head  V.  Prov.  Ins.  Co.  27,  67 

Healey  v.  Imperial  Fire  Ins.  Co.     129, 

369 
Healy  v.  Penn  Ins.  Co.  860 

Hearne  v.  Marine  Ins.  Co.  566 

Heath  v.  Franklin  Ins.  Co.        465,  466, 
468,  473,  474 
Heaton  v.  Manhattan  Fire  Ins.  Co.  275, 

360,  501 
Hebdon  v.  West  109.  440 

Hehert  v.  Mut  Life  Ins.  Co.  566  C 

Heebner  v.  Eagle  Ins.   Co.      66,  66  A, 

579 

Heffron  v.  Kittnnning  Ins.  Co.         2.33, 

247,  402,  405,  465 

Hegard  v.  Cal.  Ins.  Co.  433  A 


Section 
Heilmann    r.    Westchester    Fire 

Ins.  Co.  432 

Heiman  v.  Phoeni.x  Mut.  Life  Ins. 

Co.  43  H,  56 

Heinlein  v.  Imperial  L.  Ins.  Co.     69  A, 

112 
Helme  v.  Phila.  Life  Ins.  Co.    346,361, 

582 
Helmetag's  Adm.  v.  Miller  110 

Hemmenway  c.  Bradford  567 

Hench  v.  Ins.  Co.    •  291  A 

Hencken  ;•.  U.  S.  Life  Ins.  Co.  591 

Henderson  v.  Travelers'  Ins.  Co.       126 
V.  Western  Mar.  &  Fire  Ins. 

Co.  410, 428 

Hendrick   v.  Employers'  L.  Ass. 

Co.  514 

Hendrickson  v.    Queen  Ins.  Co.     365, 

368 
Heniker  v.  Brit.  Am.  Ins.  Co.  226 

Hening  v.  U.  S.  Ins.  Co.  15,  23  D,  24  A 
Hennessey  v.  Manhattan  Fire  Ins. 

Co.         •   ^  245,270 

Ilennessy,  Ex  parte  137 

V.  Niagara  Fire  Ins.  Co.  477 

Henning  i:  Western  Ass.  Co.  74 

Henschel  v.  Oregon  F.  &  M.  Ins. 

Co.  359,  401  a 

Henshaw  r.  Mut.  Safety  Ins.  Co.  100  A 
Henson  v.  Blackwell  115,  456 

Herbert  v.  Champion  452  F 

V.  Mut.  Life  Ins.  Co.  43  A 

Herckenrath  v.  Am.  Mut.  Ins.  Co.    10, 
12,  594  a 
Hercules  Ins.  Co.  v.  Hunter  496  a,  575, 

583 
Hercules  ^lut.  Life  Ass.  Soc,  In  re  592 
Herkimer  r.  Bice  80,  83,  445,  448 

Herkimer   Co.    Mut.    Ins.  Co.    v. 

Fuller  557,  .559 

Herkins  r.  Prov.  Ins.  Co.  466 

Hermann  r   Niagara  Fire  Ins.  Co.  67  G 
V.  Merclmnts'  Ins.  Co.  248 

Hcrmany  r.  Fidelity  M.  L.  Ass'n  156 
Hernandez  r.  Sun  Mutual  Ins.  Co.  177 
Herndon  v.  Imyierial  Fire  Ins.  Co.  492 
Heron  v.  Phoenix  Mut.  F.  Ins.  Co.  23-3, 

242 

Herrick  v.  Nat.  Life  Ins.  Co.  390 

V.  Union  Mut.  Fire  Ins.  Co.  101 ,  248 

Herrman  v.  Adriatic  Fire  Ins.  Co.  249  A, 

249  I 
Herron  v.  Peoria  Mar.  &  Fire  Ins. 

Co.  500 

Hersev  v.    Merrimack   Co.   Mut. 

Ins."  Co.  .373 

Hervey  v.  Mut.  Fire  Ins.  Co.  230 

Hess    V.    Preferred    Masonic    M. 

Ace.  Ass'n  306 

Hesterherg  v.  Eq.  Life  Ins.  Co.        341 

xlv 


TABLE    OF    CASES. 


[The  references  are  to  the  sections.] 


Section 
Heusinkveld  v.  St.  Paul  F.  &  M. 

Ins.  Co.  465 

Heutig  V.  Staniforth  507 

llewins  v.  Baker  80 

Hewitt  V.  Watertown  Fire  Ins.  Co.  425 
Hews  V.  Atlas  Ins.  Co.  401  a 

Hey  V.  Guarantors'  Liability  In- 
demnity Co.  406 
Hiatt  r.  Mat.  Life  Ins.  Co.  320 
Hibbard  u.  People  246 
Hibberl  r.  Pigon  156 
Ilibernia  Ins.  Co.  v.  Blanks  572 
V.  iMalevinsky  368 
V.  Meyer                                    .  468 
V.  O'Connor                            65,  468 
Hickerson  v.  Ins.  Co.  494 
Hickey  v.  Anchor  Ass.'  Co.  478 
1-.  British  Am.  Ins.  Co.      14,  263  E 
1-.  Empire  Ins.  Co.  289 
V.  Farmers'  Ins.  Co.                291  A 
V.  Newport  K  11.  Co.  455 
V.  National  L.  Ins.  Co.    66,  83,  340 
Hicks,  Lightle  &  Co.  v.  McGehee  421  a 
Hidden  v.  Slater  Fire  Ins.  Co.     84,  446 
Hide  V.  Bruce  178 
Higbie  v.  Guardian  Life  Ins.  Co.     192, 
196,  210,  325,  581 
Higgie  V.  Am.  Lloyd's  186 
V.  National  Lloyd's  186 
Higgins  r.  Dewev                              459 
V.  Phoeni.x  Mut.  Life  Ins.  Co.      212 
V.  Sargent                                      428 
V.  Windsor  Co.  Mar.  Fire  Ins. 

Co.  478 

Higginson  r.  Dall  82 

Highland  r.  Highland  399  F 

Hieht  r.  Continental,  &c.  Ins.  Co.     356 
Hiidreth  v.  O'Brien  584 

Hiles  r.  Hanover  Fire  Ins.  Co.  579,  59_1 
Hill  V.  Commercial  Union  Ass.  Co.  177. 
240,  247,  263  K 
V.  Cumberland   Valley  Mut. 

Prot.  Co.  267 

V.  Eq.  Mut.  Fire  Ins.  Co.    158, 176, 
180  rr,  248 
V.  Hibernia  Ins.  Co.  179  C 

I'.  Lafayette  Ino.  Co.  207.  210,  580 
r.  jMiddlesex  Mnt.  Ass.  Co.  240 
V.  Millville  Mat.  Mar.  &  Fire 

Ins.  Co.  566  A 

V.  Ohio  Ins.  Co.  248 

r.  Phoenix  Ins.  Co.  488 

Hillier  ;•.  Alleghany  Co.  Ins.  Co.     404, 

412,  596 

Hillook  )'.  Traders'  Ins.  Co.  67  B,  67  K 

Hillvard  v.  Mut.  Ben.  Life  Ins.  Co. 

39  A,  352,  446,  486 
Hilton  V.  Phoenix  Ass.  Co.     247,469  0, 

477 
Hincken  r.  Mut.  Ben.  Life  Ins.  Co.  472 

xlvi 


Section 
Hinckley  v.  Germania  Ins.  Co.  245 
Hine  v.  Homestead  Fire  Ins.  Co.     266, 

452  O 

V.  Woolworth  276  A 

Hines  v.  Mutual  L.  Ins.  Co.  69  « 

Hinman  v.  Hartford  Fire  Ins.  Co.    189, 

217,  277,  287 

Hitchcock  V.  N.  W.  Ins.  Co.     272,  273, 

381 

V.  Rollo  Ass.  595 

V.  Sawyer  25 

Hoare  v.  Bremridge  573 

Hobbs  V.  Guardian  Fire  Ins.  Co.       413 

V.  Iowa  Mut.  Ben.  Ass'n  306 

V.  Manhattan  Ins.  Co.  569  A 

V.  Memphis  Ins.  Co.  278,  279, 

281,  393 

V.  Northern  Ass.  Co.  418 

Hobby  V.  Dana  218,  230,  580 

Hobson  V.  Wellington  Dist.  Ins.  Co.  247, 

272 
Hocking  v.  Ins.  Co.  447  A 

Hodge  V.  Ellis  349  A 

V.  Security  Ins.  Co.       54  B,  560  A 
Hodge's  Appeal  390 

Hodges  V.  Tenn.  Mar.  &  Fire  Ins. 

Co.  272 

Hodgkins    v.    Montgomery    Co. 

Mut.  Ins.  Co.  143,  476 

Hodgson  V.  Cerdgalon  349  A 

Hodsdon  i'.  Guardian  Life  Ins.  Co.  136, 

350,  362,  5(  2 

Hoffecker  v.  N.  C.  C.  M.  Ins.  Co.     218, 

220,  227,  462,  488 

Hoffman  r.  .^tna  Fire  Ins.  Co.  174,  279, 

408,  428,  475 

V.  Banks  677 

V.  Hoke  398 

V.  John  Hancock  Mut.  Life 

Ins.  Co.  134 

V.   Supreme  Council  of  Am. 

Leg.  of  Honor  295,  552 

V.  Travellers'  Ins.  Co.  530 

V.  West  Mar.  &  Fire  Ins.  Co.    428, 

477,  583 

Hogan,  Re  1,  547  a 

i:  Met'n  Life  Co.  156 

Hogben   v.    Met'n      L.   Ins.    Co.     358, 

399  D 
Hoge  V  Hoge  452  F 

Ilogins  r.  Supreme  Council,  &c.  419  A 
Hogle  V.  Guardian  Life  Ins.  Co.       112, 
203,  210,215,296,446 
Hogue  V.  Minnesota  Packing  Co.      83, 

379 

Hoit  r.  Hodge  75  A 

Holabird  v.  Atlantic  Mut.  Life  Ins. 

Co.  112.305 

Holbrook  v.  Am.  Ins.  Co.  270,  272, 

865,  866,  595 


TABLE    OF   CASES. 


[The  references  are  to  the  sections.] 


Section 
Holbrook  v.  Baloise  Fire  Ins.  Co. 

364  A,  449,  496  B 
V.  St.   Paul  Fire   &  iMar.  lus. 

Co.  83  a,  219,  420 

V.  United  States  457 

Holconibe  v.  Riclimond,  &c.  R.  Co.  454 

HoUlen  v.  Putman  Fire  Ins.  Co.        67, 

569  A 
Holdich's  Case  568,  594  a 

Holdoin    /;.    Ancient    Order    of 

United  Workmen  407 

Holiday  v.  American  Mut.  Ace. 

Ass'n  306 

Holland  v.  Smith  449,  459  A 

V.  State  420 

V.  Taylor  399  M,  399  0,  563  A 
Hollingsworth  r.  Germania  Ins.  Co.  67 
Hollis  V  State  Ins.  Co.  138,  502 

Hollister  v.  Quincy  Mut.  Ins.  Co.     562 
Holloman  v.  Life  Ins.  Co.  296 

Holloway  v.  Dwelling-House  Ins. 

Co.  269 

Hollowell  V.  Va.  Ins.  Co.  857 

Holly  V.  Met   Life  Ins.  Co.  314  I 

Holman  v.  Cont.  Life  Ins.  Co.       344  E 
Holmes  v.  Broutriiton  331 

V.  Cliarlestown  Mut.  Fire  Ins. 

Co.  29,  30,  145,  207,  420,  425, 
566 
V.  Charter  Oak  Ins.  Co.  344  a 

V.  Drew  172  A,  294  E 

V.  Oilman  109  a,  399  Q 

V.  Phenix  Ins.  Co.  79,  547  a 

HolterhofE  v.  Mut.  Ben.  Life  Ins. 

Co.  299,  301 

Holter  Lumber  Co.  v.  Fireman's 

Fund  Ins.  Co.  420 

Holtzman  ;;.  Franklin  Ins.  Co.  404 

Home  Benefit  Ass'n  v.  Sargent        322, 

825 
Home  F.  Ins.  Co.  v.  Bean  465,  492 

V.  Bernstein  368 

V.  Deets  .364 

V.  Fallon  144  A,  488 

V.  Garbacz  126 

V.  Gurney  126 

V.  Ilammang  365,  469  0 

r.  Wood  368 

Home  Ins.  Co.  v.  Adler        23  A,  43  B, 

45  A 
V.  Baltimore  Warehouse  Co.     366, 
421.  437 
V.  Bethel  287  B 

v.  Cohen  475 

V.  Connally  189 

i-  Curtis  60,  134,  345  a 

V.  Daubenspeck  594 

V.  Davis  462 

V.  Delta  Bank  263  A 

V.  Duke  294  C,  589 


Section 
Home  Ins.  Co.  v.  Eakin  373  A 

V.  Favorite  59,  420,  421 

V.  Gibson  294,  469  D,  590 

V.  Oilman  359,  360  D,  447  A 

V.  Heck  674 

V.  Karn  345  E 

V.  Kinnier  244 

V.  Lindsey  381  a 

V.  Menvs  345  E,  4ri9  C 

V.  Mendenhall  248,  287  B, 

294  E,  477 
V.  Myer  464,  488 

V.  Pierce  342,  345  a,  356 

V.  Scales  248 

V.  Sorsby  138 

V.  Stanclifield  578 

V.  Sylvester  469  C 

v.  Thompson  432 

V.  Winn  477 

V.  Wood  247,  368,  369,  566 

Home  Mut.  Fire  Ins.  Co.  v.  Gar- 
field 294  E,  430,  432,  501 
v.  Hauslein  264,  379 
Home  Mut.  Ins.  Co.   v.   Oregon 

Ry.  &  Nav.  Co.  453 

V.  Roe  420  B 

Home  Mut.  Life  Ass.  v.  Gillespie     296 

Home  Protection  Ins.  Co.  v.  Avery  361 

V.  Caldwell  Bros.  86 

Homer  v.  Dorr  179  B 

V.  Guardian,  &c.  Ins.  Co.  350  a,  362 

Hone  V.  Allen  549  b,  594 

V-  Ballin  549  b 

V.  Folger  .         549  6 

V.  Mut.  Saf.  Ins.  Co.    11,  11  A,  180 

Hong  Sling  v.  National  Ass.  Co.       404 

V.  Royal  Ins.  Co.  479 

Honnick  v.  Phoenix  Ins.  Co.  190 

Honore  v.  Lamar  Ins.  Co.  424,  456,  457 

Honour  v.  Equitable  L.  Ass.  Society  3 

Hood  V.  Manhattan  P'ire  Ins.  Co.     420 

Hook  V.  Mut.  F.  Ins.  Co.  368 

Hooker  r.  Sugg  399  L,  399  N 

Hooksett  V.  Concord  R.  R.  Co.  94 

Hoop,  The  86 

Hooper  v.  Ace.  Death  Ins.  Co.         522 

V.  California  578  a 

V.  Hudson  R.  Ins.  Co.        101,  .381 

887,  420  N 

V.  Robinson  100,  448 

Hoose  V.  Prescott  Ins.  Co.       294,  294  b 

Hope  Ins.  Co.  v.  Brolaskey  288 

V.  Weed  549,  551 

Hope  Mut.  Life  Ins.  Co.  v.  Perkins  549, 

551 
Hope  Mut.,  &c.  Ins.  Co.  v.  Beek- 

man  ,5,52 

Hopkins  v.  Hopkins  399  O 

V.  Northwestern  L.  Ass.  Co.      324, 

399  D 

xlvii 


TABLE    OF   CASES. 
[The  references  are  to  the  sections.] 


Section 

Hopkins  v.  Phoenix  Ins.  Co.  67 

V.  rrovincial  Ins.  Co.  285 

Horn  i:  Amicable  Mut.  Life  Ins. 

Co.  186,  204 

V.  Anglo-Australian    &   Uni- 
versal Life  Ins.  Co.  323 
Horntlial  v.  Ins.  Co.                        144  A 
Horridure  v.  Dwelling-House  Ins. 

Co.  365 

Horscii  V.  Dwelling-House  Ins.  Co.    81 

Horst  V.  Ins.  Co.  488 

Horter  v.  Merchant's  Mut.  Ins.  Co.  45  a 

Horton  v.  Equitable  Life  Ins.  Co.    191, 

299,  301 

V.  New  York  L.  Ins.  Co.  66  A 

V.  Sayer  494 

V.  Va.  L.  Ins.  Co.  274 

Horwitz  V.  Eq.  Mut.  Ins.  Co.     144,  370 

Hosford  V.  Geruiania  Fire  Ins.  Co.  157, 

159,  292  B 

V.  Hartford  Fire  Ins.  Co.        292  A 

Hotchkiss  V.  Germania  Fire  Ins. 

Co.  151 

V.  Home  Ins.  Co.  249  I 

v.  Pha?nix  Ins.  Co.  247 

Hough  ?•.  iF.tna  Fire  Ins.  Co.  456 

V.  City  Fire  Ins.  Co.     132, 164,  248, 

283,  288 

V.  People's  Ins.  Co.    366,  421,  424, 

427,  434,  436 

Houghton  V.  Manufrs.  Mut.  Fire 

Ins.  Co.     158,  159, 164,  198, 199,  202, 

218,  254 

Hovey  v.  Am.  Mut.  Ins.  Co.  250 

I'.  Home  Ins.  Co.  595 

How  1-.  Union  Mut.  Life  Ins.  Co.     341 

Howard  v.  Albany  Ins.  Co.       100, 101, 

281 
V.  City  Fire  Ins.  Co.  373,  587 

V.  Continental  Life  Ins.  Co.        341 
V.  Franklin  Mut.  &  Fire  Ins. 

Co.  478 

V.  Great  Western  Ins.  Co.      179  C 
V.  Kentucky     &      Louisville 

Mut.  Ins.  Co.  225,  490 

V.  Lancashire  Ins.  Co.  75  A, 

100  A 

Howard's  (Sir  R.)  Case  400 

Howard  Fire  &  Mar.  Ins.  Co.  v. 

Cormick     156,  160,  178,  228, 24.3,  590 
Howard  Fire  Ins.  Co.  v.  Norwich, 

&c.  Co.  417 

Howard  Ins.  Co.  v.  Bruner,      142,  143, 

144,  149,  209,  294 

i:  Owen  23  C,  151 

V.  Scribner  366,  434,  435 

Howell  V.  Bait.  Eq.  Soc.  227 

V.  Gordon  40 

V.  Hartford  Fire  Ins.  Co.     199, 428, 

477,  583 

xlviii 


Section 
Howell  V.  Knickerbocker  Life  Ins. 

Co.  192,  346,  352 

Howland  v.  Continental  Ins.  Co.       67, 

849 

V.  Cuykendall  549 

V.  Edmonds  549 

Howson  V.  Hancock  567 

Hoxsie  V.  Prov.  Mut.  Fire  Ins.  Co. 

376,  379,  501 
Hoyt  V.  Gilnian  567 

V.  Hartfcjrd  Fire  Ins.  Co.  379 

V.  Mutual  Benefit  Life    Ins. 

Co.  55,  64 

V.  N.  Y.  Life  Ins.  Co.  106,  109 

Hubbard  v.  Glover  188  D 

V.  Hartford  Ins.  Co.     23,  286,  365, 
365  B, 477 
r.  Mutual  Ace.  Ass'n  515  a 

V.  Mutual  Reserve  Fund  Life 

Ass'n  303 

V.  Turner  399  D 

Hubert   v.   Southern    Live-Stock 

Ins.  Co.  547 

Huchberger  v.   Merchant's    Fire 

Ins.  Co.  583,  591 

Huck  r.  Globe  Ins.  Co.  412 

Huckberger  v.  Prov.  Wash.  Ins. 

Co.  465 

Huckins  v.  People's  Mut.  Ins.  Co.   410, 

425 
Huckman   v.   Fernie      123,   212,  213, 

304 
Huey  V.  Ewell  447  A 

Hugg  V.  Augusta  Marine  Ins.  Co. 

421a 
Hughes  V.  City  Fire  Ins.  Co.  191 

V.  Ins.  Co.  of  North  America    365 
V.  London  Ass.  Co.  493 

V.  Mercantile  Mut.  Ins.  43  D 

V.  Mut.  Fire  Ins.  Co.  of  New- 
castle 386,  492 
Huguenin  v.  Rayley           195,  215,  305 
Hugus  V.  Strickler  25 
Hull  V.  Equitable  Ace.  Ass.          524  A 
V.  Hull                                        399  G 
V.  North    Western,    &c.   Ins. 

Co.  344  a,  345  a 

Humboldt  Fire  Ins.  Co.  v.  Mears     241 
Hume  V.  Prov.  Washington  Ins. 

Co.  86 

Humphrey  r.  Arabin  115,  456 

V.  Hartford  Fire  Ins.  Co.      23,  379 

Hunell  V.  Bullard  124 

Hunt  V.  Hudson  R.  Fire  Ins.  Co.      590 

V.  Mercantile  Ins.  Co.  294  E 

Hunter  v.  Cobb  25 

V.  Scott  399  Q 

Huntley  v.  Merrill  66 

V.  Perry  555 

Hurd  V.  Doty  112 


TABLE    OF   CASES. 


[The  references  are  to  the  sections.] 


Section 
Hurd  V.  Masonic  Mut.  Ben.  Soc.     165, 

308 

V.  Missouri  21-± 

V.  St.  Paul,  &c.  Ins.  Co.  285 

V.  Williamsburg,  &c.  Ins.  Co.     435 

Hurlburt  v.  Carter  557,  594 

Hurlbut  y.  Hurlbut  378,  391  B 

Hurrell  c.  BuUard  154  A 

Hurst  V.  Litchfield  492 

Husti.sf  ord  F.  M.  Ins.  Co.  v.  C.  M. 

&  St.  P.  R.  H.  Co.  454 

Hutfhcraft's    Exr.   v.  Travellers' 

Ins.  Co.  520  A 

Hutcheson    v.    Nat.    Loan    Fund 

Life  Ins.  Co.  187 

Hutciiings  V.  Miner  459  B 

V.  Munger  3G0  F 

Hutcliins  V.  Cleveland  Mut.  Ins. 

Co.  291 

V.  Western  Ins.  Co.  370 

Hutchison  t:  Bowker  172  A 

V.  Liverpool,  &c.  Ins.  Co.  494 

V.  Nat.  Loan  Ins.  Co.         156,  202, 

295,  296 

V.  Niagara,  &c.  Ins.  Co.       420,  468 

V.  Western  Ins.  Co.     364,  870,  372 

Huts-in  V.  Merrifield  390,  .398 

Hutton  ('.  Meacon  Ins.  Co.  870 

V.  Waterloo  Life  Ins.  Co.    212,  299, 

304 
Hyatt  L\  Wait  553 

Hyde  v.  Goodnow  66 

V.  Lynda  555 

Hygum  (,'.  ^tna  Ins.  Co.  439 

Hynds    v.    Schenectady    County 
Mut.  Ins.  Co.  242 


Idaho  Forwarding  Co.  v.  Fire- 
man's Fund  Ins.  Co.  70  B 
Lie  r.  Phoenix  Ins.  Co.  345  B,  504 
Illinois  Ins.  Co.  v.  Archdeacon  488 
V.  Fix  379,  381 
Illinois  Mason's  Soc.  v.  Winthrop    166, 

296 
Illinois  Mut.  Fire  Ins.  Co.  v.  O'Neile 

579  B 
V.  Stanton     143,  282,  383,  387,  5-50 
Illinois    Mut.   Ins.   Co.   v.   Andes 

Ins.  Co.  11,  11  A 

V.  Marseilles  Manuf.  Co.     287,  590 

V.  Mette  263  A,  294  G 

v.  O'Neil  367 

Illinois,  &c.  Soc.  v.  Baldwin  180 

Imperial    Fire   Ins.   Co.  v.    Coos 

County  159,  175,  240 

V.  Dunbar  29  C 

V.  Dunham  287  C,  378,  386 

VOL.  I.  — d 


Section 
Imperial  Fire  Ins.  Co.  v.  Express 

Co.  416  a 

V.  Kiernan  249  D 

V.  Murray  126,  151,  424 

Imperial  Ins.  Co.  v.  Gunning  573 

Imperial  L.  Ins.  Co.  v.  Glass  360 

Imperial  Manuf.  Co.  v.  American 

Credit  Ind.  Co.  469  C 

Improved-Match  Co.  v.  Michigan 

Mut.  F.  Ins.  Co.  125 

Inbusch  V.  North  Western  Nat. 

Ins.  Co.  191 

Independent  Ins.  Co.  v.  Brehm      245, 

292  B 
V.  Capehart  469  D,  473  A,  589 
V.  Hartwell  67,  71,  589 

Independent  Mut.  Ins.  Co.  v..  Ag- 
ue w  404 
Indiana  Ins  Co.  v.  Capehart  188 
Indiana  Mut.  Fire  Ins.  Co.  v.  Co- 

quellard  269,  553,  554 

V.  Routledge  491 

Indiana  Mut.  Ins.   Co.  v.  Cham- 
berlain 266 
V.  Connor  554 
Indiana,  &c.  Ins.  Co.  v.  Connor  553,  554 
IiigersoU  V.  Knights  of  tlie  Golden 

Rule  323,  .325 

V.  Mo.  Valley  Life  Ins.  Co.         597 

Ingrams  v.  Mut.  Ass.  Soc.  555 

Inland  Ins.  Co.  v.  Stauffer         368,  463 

Inman  v.  Globe  Mut.  Life  Ins.  Co. 

186,  345,  346 

V.  Western  Fire  Ins.  Co.  462 

Innes  v.  Eq.  Ass.  Co.  104 

In  re  Benham's  Trust  465 

Commonvvealtli  Ins.  Co.  594  a 

Earl  of  Winchelsea  Pol.  Trusts 

349  A 
Magawley's  Trust  391  B 

McKirmey  594 

Security  Life  Ins.  &  Annuity 

Co.  594  a 

Turcan  399  A 

Wm.  Phillips'  Insurance  399  F 
Ins.  Com'r!'.  People's  F.  Ins.  Co.  67,67  L 
Insurance  Co.  v.  Bailey  107 

V.  Baring  93  A 

V.  Barnes  126 

V.  Bennett  825 

V.  Bonner  345  a 

V.  Braden  425  B 

V.  Brec'heisen  67 

V.  Brim  462 

V.  Camp  133  A 

t>.  Chase  80,  122  A,  184 

V.  Colt  23,  45  a,  120,  360  B 

V.  Connor  468,  552 

V.  Crockett  287  C 

V.  Cusick  124  A,  144  C,  469  B 

xlix 


TABLE   OF   CASES. 
[The  references  are  to  the  sections.] 


Section 

Insurance  v.  Dunham  2  11  A 

,,   ij^astoti  4or  A 

V.  Eggleston  352,  358,  502 

V.  Express  Co.  417 

V.  Fidelity,  &c.  Co.  454 

v.Fogarty  421  « 

V.  Foley  f^ 

V.  Folsom  ^^^00 

V.  Garland  249  E 

V.  Gordon  272 

V.  Gridley  296 

V.  Hardie  345  E 

V.  Haven  287 

V.  Hogue  126 

V.  Hughes  239  B,  241,  591 

,;.  Ins  Co.  11,  22 

I'.  Jarvis  557 

V.  Johnson  49,  58,  126 

V.  Lauderdale  299 

V.  Lee  124  A,  469 

V.  Leslie  __  30 

V.  Lyman  ''O  B 

V.  Mahone  ^^499 

V.  McCluckin  373  A 

V.  Melvin  246  A 

V.  Morely  ^36 

V.  Morse  5^8 

V.  Mowry  192 

V.  Nat'l  Bank  273  A 

V.  Newton  465 

J).  Pacaud  364 

V  Pyle  185,  567 

V.  Raden  67  B,  67  G 

V.  Robinson  344  D 

V.  Roth  499  B 

V.  Seitz  690 

V.  vSherwood  408 

V.  Simpson  82 

V.  Slaughter  193 

t;.  Starr  591 

V.  Stinson  82,  93 

V.  Stockbower  854  A,  502,  504,  553 

V.  Transportation  Co.  402 

V.  Trask  459  F 

V.  Tullidge         ^  137  A 

V.  Tweed  415,  518 

V.  UpdegrafE  83  a,  424 

V.  Webster  57,  69 

V.  Weides  465,  466,  476,  477 

V.  Wells  249  F 

i;.  Whipple  577 

V.  Wilgiis  287 

V.  Wilkinson  120,  145,  296 

V.  Williams  138  C,  144  A 

V.  Willis  459  G 

V.  Wolff  602 

Insurance  Cos.  v.  Thompson  81,  82,  95 

Ins.    Co.   of   North    America   v. 

Bachler  30,  294  E 

V.  Forcheimer  72 

1 


Section 


11 

277 

469  B 

287  B 


584 
597 


83 


453 

111 
70  B 


Ins.   Co.   of   North    America 
Hibernia  Ins.  Co. 
V.  Hofing 
V.  Hope 
V.  Johnson 

V.  McDowell     101,  241,  245,  294a, 

365  a,  374,  405,  479 

V.  St.  Louis,  &c.  Ry.  Co.        457  A 

Insurance  Co.  of  Pennsylvania  v. 

Smith 
Internal  Life  Ass.  Soc.  and  Her- 
cules Soc,  In  re 
International    Fire    Ins.    Co.    v. 

Boardman 
International  Ins.  Co.  v.  Franklin 

Ins.  Co.  67,  574 

Ini'l  Nav.  Co.   v.  Atlantic  Mut. 

In^.  Co. 
International  Trust  Co.  r.  Board- 
man 
V.  Norwich  U.  F.  Ins.  Co. 
Ionia,  &c.  Farmers'  Mut.  F.  Ins. 

Co.  V.  Ionia  Circuit  Judge    557 
V.  Otto  557 

Ionia  County  Sav.  Bank  v.  Mc- 
Lean 398,  459 E 
lonides  v.  Universal  Ins.  Co.  417 
Iowa  L.  Ins.  Co.  v.  Eastern  Mut. 

L.  Ins.  Co.  11 

Iowa  State  Mut.  Ins.  Co.  v.  Prosser    553 
Irvin  V.  Sea  Ins.  Co.  188  B 

Irvine  v.  Excelsior  Fire  Ins.  Co.    285. 
288,  477 
Isaacs  V.  Royal  Ins.  Co.  400,  401 

Isett  I'.  American  Life  Ins.  Go.  317,  325 
Isitt  V.  R.  R.  Pass.  Ass.  Co.  523  A 


Jackson  v.  British  America  Ass. 

Co.  177 

V.  Farmers'   Mut.   Fire   Ins. 

Co.  291,  292,  365,  447 

V.  Forster  324 

V.  Mass.  Mut.  Fire  Ins.  Co.      269, 

365,  365  B,  555 

V.  Northwestern    Mut.    Rel. 

Ass.  563  A 

V.  Roberts  557 

V.  St.  Paul  Fire  &  Mar.  Ins. 

Co.  11,12B 

V.  Van  Slyke  549,  559 

Jackson  Bank  o.  Williams  399  E 

Jackson  Co.  v.  Boylston  Ins.  Co.    457  B 

Jacob  V.  Cont.  Ins.  Co.  392 

Jacobs  V.  Eagle  Mut.  Fire  Ins.  Co.   290 

V.  Eq.  Ins.  Co.  365,  368 

V.  Nat.  Life  Ins.  Co.  322 

V.  New  York  L.  Ins.  Co.  159 


TABLE   OF    CASES. 


[The  references  are  to  the  sections.] 


Section 

Jacoway  v.  Ins.  Co.  345  G 

James  v.  Jellison  75  B 

V.  Lycoming  Fire  Ins.  Co.        224, 

232,  239 

V.  Stookley  138  A 

James  River  Ins.  Co.  v.  Merritt        263 

Jameson  v.  Hartford  F.  Ins.  Co.  U 

V.  Royal  Ins.  Co.  408 

Janneck  v.  Met'n  L.  Ins.  Co.     175,  299 

Jarman  v.  Knights  Templars'  L. 

Ind.  Co.  325,  327 

V.  St.  Louis,  &c.  Ins.  Co.  349 

Jarvis  v.  Conn.  Mut.,  &c.  Ins.  Co.    322 
J.  B.  Ehrsam  M.  Co.  v.  Plienix 

Ins.  Co.  158 

Jecker  v.  Montgomery  350 

Jecks  V.  St.  Louis,  &c.  Ins.  Co.      269  a 
Jefferson  Ins.  Co.  v.  Cotheal    159,  164, 

239,  580 
Jeffries  v.  Economical  Life  Ins. 

Co.  185,  206 

V.  Union  Mut.  Life  Ins.  Co.       156 

Jenkins  v.  Armour  596 

V.  Quincy  Mut.  Fire  Ins.  Co.    145, 

287 
Jennings  v.  Chenango  Co.  Mut. 

Ins.  Co.         143,  157,  218,  258 
V.  Metropolitan  Life  Ins.  Co.     511 
Jerrett  v.  John  Hancock  M.  L. 

Ins.  Co.  298 

Jersey  City  Ins.  Co.  v.  Carson  501 

V.  Nichol  365  B,  425,  477 

Jessel  V.  Williamsburg  Ins.  Co.        446 
Jewett  V.  Home  Ins.  Co.  507 

Johannes  v.  Phenix  Ins.  Co.  12 

V.  Standard  Fire  Office  287  C 

Johansen  v.  Home  F.  Ins.  Co.  270 

John   Hancock,   &c.   Ins.  Co.   v. 

Daly  299 

V.  Dick  465 

V.  Moore  320,  585 

V.  Schlink  360 

Johns  V.  Northwestern  Mut.  Re- 
lief Ass'n  325 
Johnson  v.  Amer.  Fire  Ins.  Co.    364  A, 

496  a 
V.  Berkshire  Mut.  Fire  Ins. 

Co.  408 

V.  Campbell  421 

V.  Com.  Fire  Ins.  Co.  70  B 

V.  Continental  Ins.  Co.  575 

V.  Dakota  F.  &  M.  Ins.  Co.    144  D 
V.  H.  Ins.  Co.  479,  577 

V.  Humboldt  Ins.  Co.       421 «,  492 
V.  Knights  of  Honor  399  D 

V.  London   Guaranty   &   Ac. 

Co.  306,  531  A 

V.  Mass.  Benefit  Ass'n  567 

V.  New   York   Bowery    Fire 

Ins.  Co.  365 


Section 
Johnson  v.  North  British  L.  M. 

Ins.  Co.  365 

V.  Norwalk  F.  Ins.  Co.  248 

V.  Phoenix  Ins.  Co.  466 

V.  Southern   Mut.  Life  Ins.   . 

Co.  344  F,  345  E 

V.  Swire  391  B 

V.  Union,  &c.  Ins.  Co.  246 

V.  Van  Epps      399  E,  399  N,  399  O 
Johnston  v.  Columbian  Ins.  Co.        469 
V.  Niagara  Fire  Ins.  Co.  420 

V.  West  of  Scotland  Ins.  Co.      41i! 
Johnstone  v.  Niagara  Dist.  Mut. 

Fire  Ins.  Co.  140,  397 

Johffe  V.  Madison  Mut.  Ins.  Co.  67,  358, 

502  a 
Jolly's  Adm'r  v.  Bait.  Eq.  Soc.  207, 224, 

410 
Jones  1-.  vEtna  Ins.  Co.  134,  360  B 

V.  Cons.  Investment   &  Ass. 

Co.  324,  395 

V.  Dana  133,  552 

V.  Fireman's  Fund  Ins.  Co.  232, 246 
V.  German  Ins.  Co.  401,  478 

V.  Gorham  323 

V.  Granite  State  F.  Ins.  Co.       247 
V.  Ins.  Co.  4 

1-.  Life  Ass.  Co.  358 

V.  Maine  Mut.  Fire  Ins.  Co.       367 
V.  Mechanics'  Fire  Ins.  Co.   188  B, 
469  B 
V.  New   York   Life   Ins.  Co. 

55  A,  70  a,  177,  379 
V.  Phoenix  Ins.  Co.  279 

V.  Preferred  Bankers'  L.  Ass. 

Co.  70  C 

r.  Provincial  Ins.  Co.        202,  210, 

296,  573 

V.  Sisson  559,  562 

V.  Smith  577 

V.  Southern  Ins.  Co.  263  A 

V.  U.  S.  M.  Ace.  Ass'n  531  A 

Jones  et  al.  r.  Keene  397 

Jones  Manuf.  Co.  v.  Manufrs.,  &c. 

Ins.  Co.  250 

Jordan  v.  State  Ins.  Co.  249  I,  502 

Joshua  Hendy  Machine  Works  v. 

American  Steam-Boiler  Ins.  Co.      67 
Joy  V.  Security  F.  Ins.  Co.  30 

Joyce  V.  Maine  lus.  Co.  161,225, 247, 580 
Joye  V.  South  Carolina  Mut.  Ins. 

Co.  452  F 

Jube  I'.  Brooklyn  Fire  Ins.  Co.         465 
Judah  V.  Randall  421  a 

Judale  V.  American  Ins.  Co.  552 

Judge  V.  Conn.  Fire  Ins.  Co.  269 

Judkins  v.  Un.  Mut.  Fire  Ins.  Co.     480 
Juhel  V.  Delonguemere  567 

Jurgens  v.  New  York   Life  Ins. 
Co.  399  D 

11 


TABLE    OF    CASES. 
[The  references  are  to  the  sections.] 


K. 


Section 

Kahn  v.  Traders'  Ins.  Co.         368,  369 

4t)9  D,  477,  494 

Kaliiie  V.  Ins.  Co.  of  N.  A.  55  A 

Kalinweiler  v.  Fhenix  Ins.  Co.        4b& 

492,  494 

Kaines  v.  Knightly  27 

Kane  v.  Com.  Ins.  Co.  "^0 

('.  Hibernia    Mut.   Fire    Ins. 

Co.  -276  C,  583 

V.  Reserve  Mut.  Life  Ins.  Co.  _  107 
Kanody  v.  Gore  Dist.  378  A 

Kansai  v.  Minn.  Life  &  Fire  Ass. 

124  A,  144  A 
Kansas   Farmers'    F.  Ins.  Co.  r. 

Saindon  125,  257,  270 

Kansas  Ins.  Co.  v.  Berry  456 

V.  Craft  428 

Kansas  Mill-owners'   M.   F.  Ins. 

Co.  V.  Central  Nat.  Bank  144  A 

Karelsen  v.  Sun  Fire  Office      44,  67  G, 

469 
Karow  v.  Continental  Ins.  Co.  407  A 
Kasten  v.  Interstate  Cas.  Co.  517  A 
Keatley  v  Travellers'  Ins.  Co.  298 

Keeler  v.  Niagara  Ins.  Co.         143,  184, 
280,  384,  502 
Keeley  v.  Ins.  Co.  424 

Keels  V.  Mut.  Reserve  Fund  Ass.    307, 

587  A 
Keenan  v.    Dubuque   Mut.   Fire 

Ins.  Co.  502 

V.  Missouri   State   Mut.  Ins. 

Co.  132 

Keene   v.  New   England    M.   A. 

Ass'n  517  A,  531  A 

Keeney  v.  Home  Ins.  Co.  178,  276  A 
Kebler  v.  New  Orleans  Ins.  Co.  67  H 
Keini  i'.  Home  Ins.  Co.  478 

V.  Home  Mut.  Ins.  Co.  45  a 

Keith  V.  Globe  Ins.  Co.       95,  131,  207, 

215  a 
V.  Protective  Mar.  Ins.  Co.  of 

Paris  75 

V.  Quincy  Mut.  Fire  Ins.  Co.      249 


Keller  v.  Eq.  Fire  Ins.  Co. 


V.  Gaylor 

V.  Merchants'  Ins.  Co. 
V.  Travelers'  Ins.  Co. 
Kelley  r.  Com.  Ins.  Co. 
V.  Home  Ins.  Co. 
V.  Ins.  Co. 

V.  Liverpool,  &c.  Ins.  Co. 
V.  Solari 
V.  Troy  Fire  Ins.  Co. 


133,  192, 

216 
390 


Kellner 
Kello'jff 


825 

22,  62,  65 

248 

84 

269,  365 

575 

132,  143. 

557,  560 

'.  Mutual  L.  Ins.  Co.   69  a,  340 

•.  Ch.  &  N.  W.  R.  R.  Co.  411, 

518 

lii 


Section 
Kells  f.  Northwestern  Live-stock 

Ins.  Co.  287  B,  547 

Kelly  V.  Com.  Ins.  Co.  22,  62,  65 

V.  Life  Ins.  Clearing  Co.  303 

V.  Liverpool,  &c.  Ins.  Co.  82 

V.  Norwich  Union  F.  Ins.  Co.     379 
V.  Worcester  Mut.  Fire  Ins. 

Co.  246 

Kelsey  v.  Hochelaga   Mut.   Fire 

Ins.  Co.  208 

V.  Universal  Life  Ins.  Co.   203,  214 
Kempton  v.  State  Ins.  Co.  267 

Kendall  v.  Equitable  L.  Ass.  So- 
ciety 379 
V.  Holland  Purchase  Ins.  Co.     463 
Kendrick    v.   Mutual   Benefit   L. 

Ins.  Co.  55  A,  359 

Kennan  v.  Rundle  591  A 

Kennebec  Co.  v.  Augusta  Ins.  & 

Banking  Co.  23,  151,  154 

Kennedy  v.  Agr.  Ins.  Co.  145 

V.  Home  Ins   Co.  468 

V.  N.  Y.  Life  Ins.  Co.  117 

V.  St.  Lawrence  Co.  Mut.  Ins. 

Co.  143,  206,  228,  258 

Kenniston  v.  Merrimack  Co.  Mut. 

Ins.  Co.  406 

Kenny  r.  Union  Mar.  Ins.  Co.  425 

Kensington,  Ax  parte  291 

Kensington  Nat.  Bank  v.  Yerkes     158, 

294 

Kent  V.  Bird  27,  74 

V.  Liverpool  &  L.  Lis.  Co.  420 

V.  Manchester  566 

Kenton  Ins.  Co.  v.  Shea  365  a,  372 

V.  Wigginton  30,  287  B,  460 

Kentucky  v.  Ins.  Co.  548 

Kentucky  Ins.  Co.  v.  R.  R.  Co.         454 

Kentucky  Life  &  Ac.  Ins.  Co.  v. 

Franklin  306 

V.  Hamilton       75  B,  112,  117,  398, 
497,  590 
Kentucky  Masonic  Ins.  Co.  v.  Mil- 
ler 550  a 
Kentucky  Mut.  Ins.  Co.  v.  Jenks      60, 
347,  400,  565 
Kentucky  Mut.  Life  Ins.  Co.  v. 

Calvert  174 

Kentuckv  &  Louisville  Mut.  Ins. 

Co.  V.  Southard        159,  163,  164,  591 

Kentucky,  &c.  Ins.  Co.  v.  Mather     568 

V.  Yates  390 

Kenyon  i\  Berthon  158 

V.  Knights  Templar  Ass'n     144  A, 

306 
Kepler  v.  Supreme  Lodge  899  J 

Kerlin  v.  National  Ace.  Ass'n  360 

Kerman  r.  Howard  391 

Kern  v.  South  St.  Louis  Mut.  Fire 
Ins.  Co.  680 


TABLE    OF   CASES. 
[The  references  are  to  the  sections.] 


Section 
Kernochan  v.  N.  Y.  Bowery  Jire 

Ins.  Co.    116,  215  a,  424,  456,  457,  504 
Kerr  v.  Brit.  Am.  Ass.  Co.  46G 

V.  Gore  Dist.  Mut.  Fire  Ins. 

Co.  ^°*^ 

V.  Hastings    Mut.    Fire    Ins. 

V.  Minn.  Mut.  Ben.  Ass'n  322 

324,  327  A 
Kershaw  v.  Kelsey  42,  350 

Ketcham  y.  American  Mut.  Ace. 

Ass'n  ^^^    ^}:^ 

Ketchum  .-.  Prot.  Ins.  Co.         447   4b6 
47y,  484,  488,  590,  591 
Kettenring  v.  Northwestern  Ma- 

sonic  Aid  Ass'n  ^oo 

Key  V.  Des  Moines  Ins.  Co.  loo  A 

?;.  National  L.  Ins.  Co.  567 

Keyser  v.  Hartford  Fire  Ins.  Co.  36o  B 

Keystone  Mut.  Ben.  Ass.  v.  Norris 

■^  102  A,  110,  483 

Kibbe  v.  Hamilton  Mut.  Ins.  Co.     145. 

288 
V.  Travellers'  Ins.  Co.  501 

Kidder  v.  Travelers'  Ins.  Co.  56 

Kiesel  v.  Sun  Ins.  Office  412 

Kill  V.  Hollister  492,  49o 

Killips  V.  Putnam  Fire  Ins.  Co.        461 
^  468,  488 

Kimball  v.  iEtna  Ins.  Co.  182,  192, 

194,  248 
V.  Hamilton  Ins.  Co.  476,  505 

V.  Howard  Fire  Ins.  Co.     277,  368, 
371,462, 
?;.  Lion  Ins.  Co.  43  F 

V.  Monarch  Ins.  Co.        249  A,  294 
V.  Springtield    Fire   &   Mar. 

Ins.^Co.  182 

Kincade  v   Bradshaw  58.j 

King  V.  Ace.  Life  Fund  59/ 

V.  JEtna  Ins.  Co  67 

r.  Council  Bluffs  Ins.  Co.  502 

?).  Enterprise  Ins.  Co.  589 

V.  Hekla  Fire  Ins.  Co.  70  B,  100  A, 

469 

V.  Joliffe  179  A 

V.  Preston  4o6 

V.  Prince  Edward  Ins   Co.  425 

V.  State  Mut.  Fire  Ins.  Co.  74,  116, 

456 
V.  Walker  421  a 

r.  WatertownFirelns.Co.  479,488 
King  Brick  M.  Co.  v.  Phoenix  Ins. 

Co.  156,  250 

Kings  Co.  Fire  Ins.  Co.  v.  Swigert 

124  A,  133  A,  239  A 
Kingsley  v.  N.  E.  Mut.  Fire  Ins 

Co.  156,158,162,229,446,462 

Kingston  v.  iEtna  Ins.  Co.  144  A 

V.  South  Aus  Ins.  Co.  <0C 


Section 
Kingston  Bank  v.  Eltinge  575 

Kinney  v.  Baltimore,  &c.  Relief 

Ass  n  494 

Kip  V.  Mut.  Fire  Ins.  Co.  456,  561 

Kircher  v.  Milwaukee  M.  M.  Ins. 

Co.  245 

Kirk'r.  Dodge  Co.,  &c.  Ins.  Co.  358 
Kirkman  1-.  Farmers' Ins.  Co.  469  U 
Kirkpatrick  v.  Knickerbocker  Life 

Ins.  Co.  344  a 

Kitchen  v.  Hartford  Ins.  Co.  372  A 
Kittanning  Ins.  Co.  v.  Hebb  579 

Kitts  V.  Massasoit  Ins.  Co.  27d 

Klein  v.  Liverpool,  &c.  Ins.  Co.  21 

V.  Union  Fire  Ins.  Co.     279,  452  B 
Kleis  V.  Niagara  Fire  Ins.  Co.  566 

Kline  v.  Nat.  Ben.  Ass.  359,  399  L 

Knapp  V.  Homoeopathic  Life  Ins. 

Co.  344  a 

V  Preferred  Mut.  Ace.  Ass.  523  A 
Knapp,  &c.  Co.  v.  Nat.  Mut.  Fire 

Ins.  Co.  ^'^ 

Knarston  y.  Manhattan  L.  Ins.  Co.  360 
Knauer  v.  Globe.  &c.  Ins.  Co.  566 

Knecht  v.  Mut.  Life  Ins.  Co.   1»»,  191, 

Knickerbocker  Ins.  Co.  v.  Com- 

stock  5^2 

V.  Gould  401,  462,  465 

V.  McGinnis  462 

Knickerbocker   Life  Ins.   Co.  v. 

Heidel  159,  344  H 

V.  Pendleton  342  A,  469 

V.  Weitz  390,  391 

Knickerbocker,    &c.  Ins.    Co.  v. 

Deitz  345  a 

V.  Harlem  345  a 

V.  Peters  312 

Knight  V.  Eureka,  &c.  Ins.  Co.         o65 

Knights  of  Maccabees  v.  Volkert     .j06 

Knights  of  Pythias  v.  Beck  325 

V.  Cogbill  187,  30o 

V.  Rosenfeld  298 

V.  Stein  f  5 

V.  Withers  124  A 

Knights  Templar  Ind.  Co.  v.  Berry  o27 

V.  Jacobus  ,  '70  C 

Knights  Templars'  Mut.  Aid  Ass  n 

V.  Greene  1^^,-1 

Knop  V.  National  F.  Ins.  Co.     28o,  4/7 
Knorr  v.  Home  Ins.  Co.  569  A 

Knowles  v.  Scribner 
Knox  V.  Lycoming  Ins.  Co. 

V.  Turner 
Knoxville  F.  Ins.  Co.  v.  Hird 


58.*] 

498 

8,  449 

263  A 


Koehler  v.  Centennial  Mut.  Life 
Ins.  Co.  ^  399  G 

Kohen  v.  Mut.  Reserve  Fund  Life 
Ass.  55  A 

Kohne  v.  Ins.  Co.  of  North  America    45 

liii 


TABLE    OF   CASES. 


[The  references  are  to  the  sections.] 


Section 

Kolgers  v.  Guard.  Life  Lis.  Co.        1^6 

Konrad  v.  Union  Cas.  Co.  325 

Kooistra  v.  Rockford  Lis.  Co.         67  L 

Koontz  V.  Hannil)al  Ins.  Co.  172  A 

V.  Hannibal  Sec.  Ass.  189,  278 

Korn  V.  Mut.  Ass.  Co.  of  Va.  66  A 

Kosiilaiid  V.  Fire  Ass'n  270,  590 

V.  Hartford  Ins.  Co.    269, 276,  285, 

294  C 

V.  Home  Ins.  Co.  270 

Kratzenstein  v.  Western  Ass  Co.    175, 

177 
Krause  v.  Equitable  L.  Ass.  So- 
ciety 95  A,  360 
Kreutz  v.  Niagara  Dist.  Mut.  Fire 

Ins.  Co.  143,  189,  227,  502 

Kronk  v.  Birmingham  Ins.  Co.  82,  285 
Krug  V.  German  F.  Ins.  Co.  230,  248 
Kruger  v.  Western  Fire  &  Mar. 

Ins.  Co.  501,511 

Krumm  r.  Ins.  Co  154  A 

Kulen  Kemp  v.  Vigne  2 

Kuner  v.  Amazon  Ins  Co.  154  A 

Kunzee  v.  Am.  Exch.  Fire  Ins.  Co.  70  a, 

401  a 

Kynaston  v.  Liddell  496  B 

Kyner  v.  Kyner  454 

Kyte  V.  Com.  Union  Ass.  Co.      137  A, 

245, 273 


Lackey  v.   Georgia   Home    Ins. 

Co.  365 

Laclede  Fire-Brick  Manuf.  Co.  v. 

Hartford,  &c.  Ins.  Co.  239 

La   Compagnie    D'Ass.,    &c.    r. 

Grammon  342,  342  A,  359 

Ladd  r.  iEtna  Ins.  Co.  253 

Lafarge  v.  Liv.,  Lon.,  &  Globe  Ins. 

Co.  465 

Lafleur  v.  Citizens'  Ass.  Co.  59,  372 
La  Fonderie  v.  La  Cour  d'Ass.  504  A 
L'Agricole  c.  Chaumiere  365  a 

Lagrone  i'.  Timmerman  591  A 

Laidlaw  v.  Liverpool,  &c.  Ins.  Co.  207, 

285 
L'Aigle  c.  Aubrv  356 

Lake  v.  Farmers'  Ins.  Co.  469  C,  469  D 
Lake  Erie  &  W.  R.  Co.  v.  Falk  458 
Lakings  v.  Phoenix  Ins.  Co.  401  a,  420 
Lamar  Ins.  Co.  ;•.  McGlashen  428 

Laniatt  v.  Hudson,  &c.  Ins.  Co.  192 
Lamb  v.  Council  Bluffs  Ins.  Co.   188  C, 

294  D 
Lamberton  v.  Conn.  Fire  Ins.  Co.  249  J 
Lamont  v.  Hotel  Men's  Mut.  Ben. 

Ass.  399  O 

Lampkin  >•.  Western  Ass.  Co.  488 

liv 


SectioQ 
Lamson   Consolidated  Store-Ser- 
vice Co.  V.  Prudential  F.  Ins. 
Co.  494 

Lancashire  Ins  Co.  v.  Boardnian     269 
V.  ]Sill  67  F 

Lancaster's  Case  594  a 

Lancaster  Fire  Ins.  Co.  v.  Lenheim  238 
Lancaster  Mills  v.  Merchants'  Cot- 
ton Press  Co.  72 
Lancaster  Silver  Plate  Co.  v.  Man- 
chester Ass.  Co.               239  A 
V.  National  F.  Ins.  Co.           239  A 
Lancey  v.  Phoenix  Fire  Ins.  Co.      70  a, 

190 
Landis  v.  Home  Mut.  Fire  &  Mar. 

Ins  Co.  69 

Landrum  v.  Knowles  391 

Lane  v.  Maine  Mut.  Fire  Ins.  Co.     101, 

265,  272,  274,  278,  590 

Lang  V.  Delaware  Mut ,  &c.  Ins. 

Co.  572 

V.  Hawkeye  Ins  Co.       287  C,  291 

Langan  v  Royal  Ins.  Co.  477 

Langdale  v.  Mason  403 

Langdon  v.  Minnesota  Farmers' 

Mutual  Fire  Ins.  Ass'n  6 

V.  Minn.  Mut.  Ins.  Co.  273 

V.  N.  Y.  Eq.  Ins.  Co.  191,  230, 

242 

V.  Union  Mar.  Life  Ins.  Co.      110, 

154  A,  188  C 

Langley  r.  Queen's  Ins.  Co.  91 

Ijungston,  Ex  jtarte  291 

Langvvorthy  v.  Oswego  Ins.  Co.    401  a 

L'Anse  Village  v.  Fire  Ass'n  of 

Philadelphia  401  a 

Lantalum  v.  Anchor  Mar.  Ins.  Co.  493 
Lantz  V.  Vermont  L.  Ins.  Co.  340 

Lapeer  Ins.  Co.  v.  Doyle  172  A 

Lappin  v.  Charter  Oak  Ins.  Co.      266, 

448 
Larkin  v.  Interstate  Cas.  Co.  517  A 
La  Rocque  v.  Royal  Ins.  Co.  373  A 
Laselle  v.  Ins.  Co.  249  D,  249  E 

Lasher  v.  N.  W.  Nat.  Ins.-Co.       447  A 
V.  St.  Joseph  Fire  &  Mar.  Ins. 

Co.  501 

La  Socie'te'  de  Bienfaisance,  &c.  v. 
Morris,  &c.  Agts.  of  Home  Ins. 
Co.  360  B,  469 

Latham  v.  Smith  25 

Latiniore  v.  Dwelling-House  Ins. 

Co.  67,  566 

Latoix  V.  Germania  Ins.  Co.  67  B,  360  B 

Lattan  v.  Royal  Ins.  Co.       67  C,  67  F, 

67  J,  425 

Lattomius    v.    Farm.    Mut.    Fire 

Ins.  Co.  79  D,  221,  222 

Laurent  v.  Chatham  Fire  Ins.  Co.     30, 

31,  81,  424 


TABLE  OF  CASES. 


[The  references  are  to  the  sections.] 


Section 

L'Automedon  c.  Isot  538 

Lavabre  v.  Wilson  222 

Law  v.  Hand-in- Hand  Ins.  Co.  502 

V.  London  Indisputable  Life 

Policy  Co.  8,  115 

V.  New  England   Mut.  Ace. 

Ass'n  488 

Lawe  V.  Hyde  170 

Lawing  v.  Rintles  452  A 

Lawless   v.   Tenn.    Mar.   &   Fire 

Ins.  Co.  245 

Lawrence  v.  Ace.  Ins.  Co.  523  A 

V.  Holyoke  Ins.  Co.  379 

V.  McCready  59(i 

V.  Mut.  Life  Ins.  Co.  325 

V.  Nat.  Fire  Ins.  Co.  246 

V.  Nelson  596 

V.  Ocean  Ins.  Co.  474 

V.  Sebor  352  E 

V.  St.  Mark's  Fire  Ins.  Co.  84 

V.  Van  Home  285 

Lazarus  v.  Com.  Ins.  Co.  268,  879 

Lea  V.  Hinton  459  A 

Leach  v.  Republic  Fire  Ins.  Co.    180  a, 

373,  491,  492 

Leadbetter  v.  JEtna  Ins.  Co.  466 

Leathers  v.  Cora.  Ins.  Co.  38,  287 

Leavitt  v.  Western  Mar.  &  Fire 

Ins.  Co.  365  a.  445 

Lebanon  Mut.  Ins.  Co.  v.  Erb      253  B, 

287  C,  349  B,  469 

V.  Hoover  360  A 

V.  Kepler  408,  434,  465,  501 

?-•.  Losch  221,  294  C 

Ledyard  v.  Hartford  Fire  Ins.  Co.     666 

Lee,  Ex  parte  37 

V.  Abdy  379 

V.  Adsit  445 

V.  Guardian  Life  Ins.  Co.  143 

V.  Howard  Fire  Ins.  Co.     101,  145 

223,  237,  242,  277,  374,  424 

V.  Mutual  Reserve  Fund  Life 

Ass'n  557 

V.  Union  Central  L.  Ins.  Co.       340 

Leeds  v.  Cheetham  (5 

V.  Mechanics'  Ins.  Co.       70  B,  177 

Lefavour  v.  Ins.  Co.  44,  215,  353 

Leggett  V.  ^Etna  Ins.  Co.  178,  228, 

2.39,  241,  242,  243 

Lehman  r.  Clark  557 

0.  Great  Eastern  Cas.  &  Ins. 

Co.  531  A 

V.  Gunn  459  B 

Leibrandt,   &c.  Co.    v.  Fireman's 

Ins.  Co.  365  C 

Leinhauf  v.  Caiman  391  B 

Leman  v.  Manhattan  L.  Ins.  Co.     -325, 

465 
Lemon  v.  Phoenix  Mut.  Life  Ins. 
Co.  395,  397 


Section 
Lenig  v.  Eisenhart  398 

Lentz  V.  Teutonia  Fire  Ins.  Co.        479 
Leonard  v.  Eagle  Life  &  Health 

Ins.  Co.  117 

v.  Wasliburn  567,  577 

Leonarda  i'.  Phoenix  Ins.  Co.    79,  81, 423 

Le  Pypre  r.  Farr  422  A 

Lerow  v.  Wilmarth  88,  459  G 

Le  Roy  v.  Globe  Ins.  Co.  594  a 

V.  Market  Ins.  Co.  51,  159,  185 

V.  Park  Fire  Ins.  Co.  159,  199 

Leslie  v.  French  349  A 

V.  Knickerbocker  Ins.  Co.  497 

Le  Soleil  v.  Alby  83  a 

V.  Delord  67 

Lester  v.  Webb  315  E 

Lett  V.  Guardian  Fire  Ins.  Co.  67,  279, 

457  C 

Levi  V.  N.  0.  Ins.  Ass.  411 

Levie  r.  Met'n  Life  Ins.  Co.      156,  298 

Levine  v.  Lancashire  Ins.  Co.       263  A 

Levy  V.  Baillie  477 

V.  Merrill  402 

V.  Peabody  Ins.  Co.  372,  589 

V.  Virginia  Fiie  Ins.  Co.  479 

Lewis  V.  Atlas,  &c.  Ins  Co.  576 

V.  Council  Bluffs  Ins.  Co.       294  C 

V.  Hudnian  579 

V.  Monmouth  Mut.  Fire  Ins. 

Co.  464,  468,  504 

V.  Mut.    Reserve    Fund     L. 

Ass'n  358 

V.  N.  E.  Fire  Ins.  Co.  287  C 

V.  Phoenix  Mut.  Life  Ins.  Co.    107, 
202,  341,  346,  356,  393,  568 
V.  Rucker  30 

V.  Springfield   Fire    &    Mar. 

Ins.  Co.  404,  412 

Lexington  Ins.  Co.  v.  Paver  188  C,  207 
Libby  V.  Libby  399  V 

Libenstein  v.  Mina.  Ins.  Co.  420 

V.  Baltic  Ins.  Co.  420 

Liberty  Hall  Ass.  v.  Housatonic 

Mut.  Fire  Ins.  Co.  166,  501 

Liberty  Ins.  Co.  v.  Boulden  287  B 

License  Tax  Cases  25 

Liddle  v.  Market  Ins.  Co.  1.32  190,371 
Liebenstein  v.  Baltic  Fire  Ins.  Co. 

420  B 

Lieber  v.  London,  &c.  Ins.  Co.  404 

Life  Ass.  V.  Goode  465,  471 

r.  Lemke  563  A 

Life  Ass.  Co.  of  Scotland  v.  Foster    200, 

202,  296,  297 

Life  Ins.  Co.  v.  Davidge        345  B,  3.59 

V.  Le  Pert  345  D 

V.  M'Cram  398 

V.  Terry  307 

Life  Ins.  Clearing  Co.  v.  Altshuler  298, 

360 
Iv 


TABLE   OF   CASKS. 


Section 
Life  Ins.  Clearing  Co.  v.  Bullock     340 
Liulubo.ly  V.  iN.  A.  Ins.  Co.   43,  44,  60, 
^  130,  215  a,  400 

Liuun's  Adm'rs  v.  Ins.  Co.  4ti9  B,  475 
l.inilmrj;  v  Germ  an  F.  Ins.  Co.  ^40,  248 
l.imeriLk  i-.  Gorliani  345  li 

Lintiiiucr  v.  Del.  Mut.  Safety  Ins.     10, 

43  A 
Linde  v.  Kepublic  Fire  Ins.  Co.   423  A 
Lindeneau  v.  Desborough  123,  201,203, 
207,  213,  296 
•Linder  r.  Fidelity  &  Cas.  Co.  379 

Lindner  i;.  St.  Paul  F.  &  M.  Ins. 

Co.  2«7  B,  421  a 

Lindsey  v.  Union  Mut.  Fire  Ins. 

Co.  160,  225 

Linlord    v.   Provincial    Horse   & 

Cattle  Ins.  Co.  137 

Lingeiifeller  v.  Phcenix  Ins.  Co.  23  A 
Lingley  r.  Queen  Ins.  Co.  373 

Lipnian  v.  Niagara  Fire  Ins.  Co.  54  B 
Lipi)incott  v.  Ins.  Co.  566  A 

Lippnian  v.  yEtiia  Ins.  Co.  369 

Liseoni  v.  Boston  Mut.  Fire  Ins. 

Co.  366,  423 

Lisliemun    v.  Northern,  &c.   Ins. 

Co.  190 

Litch  V.  X.  British,  &c.  Ins.  Co.  249  C 
Little  V.  Eureka  Ins.  Co.  67,  67  K.  264, 

273 
260  A 
Ins. 

344  « 

23  D 

469  B,  488 

578  A 

566 


[The  references  are  to  the  sections.] 

Section 

Lloyd  V.  West  Branch  Bank  23  D 

Locke  V.  N.  A.  Fire  Ins.  Co.  185 

Lockwood  i>.  Bishop  399  N 

V.  Middlesex  Mut.  Ass.  Co.     70  a, 

249  B,  280,  285,  292,  292  A, 

872  C 

Lockyer  v.  Offley  352 

Lodge  V.  Capital  Ins.  Co.  291  A 

Loeb   V.   American   Central  Ins. 

Co.  126 

Loehner  v.  Home  Mut.  Ins.  Co.       137, 

189,  245 

Logan  V.  Com.  Union  Ins,  Co.  406 


&c. 


V.  Ins.  Co. 

V.  North   Western, 

Co. 
V.  O'Brien 
V.  Phcrnix  Ins.  Co. 
Liverpool  Ins.  Co.  v.  Moss 

r.  Wyld 
Liverpool,  Lond.,  and  Globe  Ins. 

Co.  r.  Sorsby  511 

Liverpool  &  Great  Western  Steam 

Co.  V.  Piienix  Ins.  Co.  457  A 

Liverpool,  &c.  Ins.  Co.  v.  Buck- 

st.iff  248 

V.  Cochran  287  B 

V.  Creighton  493 

V.  Ellington  263  A 

V.  Ende  133  A,  502 

I'.  Farnsworth  Lumber  Co.        239 


V.  Gunttier 
V.  Kearney 
V.  .McGuire 
r.  .McNeill 
r.  Sheffy 
I'.  Van  ()s 
V.  Verdier 
Livings  r.  Domett 


227,  234 

175, 263  A 

247,  249  B,  283 

420 

363  A,  369 

144  F,  175,  177,  2.S9 

365,  434,  439 

.391  O 


r.  Home  Mut.  Fire  Ins.  Co. 
Livingston  ;•.  Md.  Ins.  Co. 

I'.  Stickles  1' 

Livingstone  v.  Western  Ins.  Co. 
Ivi 


423  B 

207 

0,  267 

379 


Lolines  v.  Ins.  Co.  of  N.  A. 

126,  129, 

409 

Lomas  v.  Brit.  Am.  Ass.  Co. 

221,226 

London  Ass.  Co.  v.  Drennen 

240 

!!.  Paterson 

4.34 

London  Ass   Soc.  r.  Mansel 

212,  573 

London,  &c.  Ins.  Co.  v.  Fischer        175, 

239  A,  294  E 

V.  Gerleson 

250,  294  E 

V.  Honey 

493 

V.  Montefiore 

377 

V.  Sainsbury 

453 

V.  Storrs 

494 

i\  TurnbuU 

365 

London,  &c.  Life  Ins.  Co.  v 

La- 

pieire 

109,  567 

V.  Lycoming  Ins.  Co. 

12  C 

V.  Turnbull 

126  A 

London  K.  R.  Co.  i'.  Glynn 

424 

Long  V.  Allen 

173 

V.  Beeher 

218,  227 

V.  North  British  &  Merc.  Ins. 

Co.  70  B 

V.  Penn  Ins.  Co.  596 

Longhurst  v.  Conway  Fire  Ins. 

Co.        161,  256,  263,  288,  291, 

293,  466,  479 

V.  Star  Ins.  Co.      93,  487,  503,  566 

Longmaid  et  ux.  v.  Holliday  453 

Longman  v.  Grand  Junction  Canal 

Co.  -  454 

Long  Pond  Ins.  Co.  v.  Houghton     557, 

559,  560 

Longueville  v.  Western  Ass.  Co.     219, 

420 

Loomis  V.  Eagle  L.  &  H.  Ins.  Co.       7, 

106, 107,  117 

V.  Rockford  Ins.  Co.  189 

V.  Shaw  79 

Looney  v.  Looney  399  I 

Loos  V.  John  Hancock  Mui.  L. 

Ins.  Co.  399  D,  445 

Lord  V.  Dall   71,  102,  105,  107,  117,246 
Lorie  v.  Conn.,  &c.  Ins.  Co.  839 

Lorillard  Fire  Ins.  Co.  v.  McCul- 

loch  166,  285,  497,  501 

Lormg  V.  Manuf.  Ins.  Co.  227,  379,  447 


TABLE   OF   CASES. 
[The  references  are  to  the  sections.] 


Section 
Lorlng  f.  Proctor  55  a 

V.  Steinenian  4ti5 

Lothrop   V.   Greenfield    Stock   & 

Milt.  Fire  Ins.  Co.  355  A,  562 

Loud  L\  Citizens'  Mut.  Ins.  Co.        171, 
219,  407  A 
Louishina  Mut.  Ins.   Co.  v.  New 

Orleans  Ins.  Co.  197 

Louisville  &  N.  li.  Co.  v.  Manches- 
ter Mills  453 
Louisville  Underwriters  c.  Pence      67 

300 
-Lounsbury  v.  Prot.  Ins.  Co.  239,  245, 
_  405,  590 

Lovejoy  V.  Augusta  Mut.  Fire  Ins. 

Co.  189, 277 

V.  Hartford  Fire  Ins.  Co.         459  F  I 
Loveil  V.  St.  Louis  Mut.  Life  Ins. 
.^  Co.  130^  344  J) 

Loventhal  v.  Home  Ins.  Co.  83  a.  287  B 
Levering  r.  Mercantile  Mar.  Ins. 
^  Co.  422  A 

Love  well  v.  Westchester  Ins.  Co.  .  420 
Lovick  V.  Providence  L.  Ass'n  70  C 
Lowe  c.  United  States  Mut.  Acci- 
dent ^Vss'n  478 
Lowell  V.  Accident  Ins.  Co.  530 
V.  xMiddlese.\  Mut.  Ins.  Co.       290. 

447 
Lowell  Manuf.  Co.  v.  Safeguard 

Fire  Ins.  Co.  434 

Lowene  v.  American  Fire  Ins.  Co.  594  « 

Lowestone  r.  Royal  Ass.  Co.  81 

Lowndes  c.  Stamford  493 

Lowry  i:  Bourdieu  557 

V.  Ins.  Co.  of  North  America     449 

V.  Lancashire  Ins.  Co.  473  A 

Loy  I'.  Ins.  Co.  269  a,  276  C 

Lozano  v.  Palatine  Ins.  Co.  203  A 

Lubclsky  v.  Royal  Ins.  Co.  249  I 

Lucas  r.  Ins.  Co.  421 

r.  Jefferson  Ins.  Co.  13,  434 

Luce  V.  Dorchester  Ins.  Co.  31,  248, 

o     .     „  580,  582 

V.  Spnngfield  Fire  &  Mar.  Ins. 

Co.  5^ 

Lucena  v.  Craufurd      1,  73,  7.5,  77,  115 
Luciani  r.  American  Fire  Ins.  Co.'    27 

Til  TT       .  ^  70    (I 

Ludlow  V.  Union  Ins.  Co.  579 

Ludwig  V.  Jersey  City  Ins.  Co.       70  a 

T       ,     ,    T.   .  ™  I^'  1^0,  501 

Lueder  s  Ex  rs  v.  Hartford  Life  & 

An.  Ins.  Co.  303,  563  A 

Luhng  V.  Atlantic  Mut.  Ins.  Co.      428, 

571 
Lum  V.  United  States  F.  Ins.  Co. 

T       ^  ,  'OB,  469  C 

Lumbermen's    Mut.   Ins.    Co.   v 
^eil  125,  144  A,  469  C 


Section 
Lumbermen's    Mut. "  Ins.   Co.   v 
Kansas  City,  Ft.  S.  &  M.  R.  Co.   66  A, 

Lundy  v.  Lundy  4Q7 

Lungstrass  v.  German  Ins.  Co.  53 

Luthe  V.  Farmers'  Mut.  Fire  Ins. 


Co 

Lycoming   Co.    Mut.  Ins.  Co 
Langley 

V.  Mitchell 

v.  Roughts 

V.  SchoUenberger 

V.  SchretHer 

V.  Stocklonin 

V.  Updegratr 
Lycoming  Fire  Ins 


591  A 


Co. 


137  A 

30 

660  B 

126,  144 

447,  504,  579 

502 

401  a,  475 

.  Rubin 

373  A,  579 

403 

352  A,  589 

1.35 


469,  469  B 

159 

401  a,  420 

579 

126,  497 

Co.    V. 

134 


V.  Schwenk 

V.  Storrs 

Lycoming  Ins.  Co.  v.  Barringer  812  C 

,,  408 

I'.  IJunmore 
V.  Jackson 
r.  Sader 
V.  Schreffler 
V.  Wood  worth 
Lycoming  Mut.  Fire  Ins 

Bedford 

Lycoming  Mut.  Ins.  Co.  y.  Wright  560  A 

Lyman  i:  State  Mut.  Fire  Ins.  Co.   67 

219,  226,  580 

Lynch  r.  Burgoyne  34.5  E 

V.  Dalzell  6,  100,  377 

V.  Dunsford  J22 

V.  Morse  25 

Lynchburg  Hose  Fire  Ins.  Co.  v. 

T  ^^"«^  41,  351,  486 

i-ynde  i:  Newark  Ins.  Co.     379  385  A 

Lynn  ;•.  Burgoyne  65,  154,  555 

Lynn  Gas  &  Electric  Co.  v.  Meri- 

den  Ins.  Co.  402 

Lyon  V.  Commercial  Ins.  Co.   207,  212, 

247 
V.  Dakota  Ins.  Co.  294  E 

V.  Railway  Pass.  Ass.  Co.  522 

I'.  Stadacona  Ins.  Co.  255 

V.  Travelers'  Ins.  Co.      175,  345  B 
Lyons  v.  Globe  Mut.  Fire  Ins.  Co.   505 

553 
V.  Prov.  Wash.  Ins.  Co.  401  B 


M. 

Niagara  Fire  Ins. 


McAllaster 

Co.  40Q 

McAllister  i:  Tenn.  Ins.  Co.  415 

McAllister,  Adm'x,  v.  N.  E.  Mut. 

Life  Ins.  Co.  67  342 

Ivii 


TABLE   OF   CASES. 


[The  references  are  to  the  sections.] 
Section 


Somerset  Co.  Mut. 
Globe  Mut.  L.  Ins. 


249 


McAnally 
Ills.  Co. 

McArthur  ..  - 

Co.  l"**  ^ 

V.  Home  Life  Ass.  U4.  G 

McBride..KeimblicFireIn.Co.^^^^^ 

McCabe  r.  ^T.tna  Ins.  Co.  21,  70  B 

'MiCiiU  I'.  PlioBiiix  M.  Life  Ins. 

Co  144  B,  305,  363  A 

McCann  v.  iEtna  Ins.  Co.  566  C 

MuCiirtee  v.  Camel  46o 

McCariliy  v.  Catholic  Knights  30o 

l:  Met'n  L.  Ins.  Co.  16, 

399  D 

I'.  Travellers'  Ins.  Co.      515  «,  518 
McCartney  v.  State  Ins.  Co.  67  B 

Macarty  v.  Com.  Ins.  Co.  85,  264, 424 
Macaulay  v.  Central  Nat.  Bank  399  N 
McClave  v.  Mutual  Reserve  Fund 

L.  Ass'n  159 

McCluer  i'.  Girard  219,  420 

I'.  Home  Ins.  Co.  502 

McClure  v.  Lancashire  Ins.  Co. 


r.  Mut.  Life  Ins.  Co. 
V.  Watertown  Ins.  Co. 
McCluskey  v.  Prov.  Ins.  Co. 
McCoUum  V.  Liverpool,  London 
&  Globe  Ins.  Co. 
V.  Mutual  L.  Ins.  Co. 
McConias  v.  Covenant  Mut.  Life 

Ins.  Co. 
McConnell  v.  Delaware  Ins.  Co. 


401  fl 
325 
248 
379 

138 

158 


V.  Iowa  Mut.  Aid  Ass'n 
McCord  i\  Noyes 
McCormick  v.  Ferner 

V.  North  British  Ins.  Co. 

r.  Roval  Ins.  Co. 


469 
575, 
583 
156 
388,  447 
81 
589 
239 


McCoubray  v.  St.  Paul  F.  &  M. 

Ins.  Co.  469  D 

McCoy  V.  Iowa  State  Ins.  Co.         267, 
287  B,  420,  497 
V.  Metropolitan  Life  Ins.  Co. 

145  A 
V.  Northwestern  Mut.  Relief 

Ass'n  557 

V.  Roman  Catholic  Mut.  Ins. 

Co.  557 

McCraiii  v.  Quaker  City  Ins.  Co.  424 
McCraw  v.  Old  North,  &c.  Ins.  Co.  358 
McCrea  v.  Waterloo  Co.  Mut.  Ins. 

Co.  869 

McCulloch  V.  Eagle  Ins.  Co.    19,  46,  48 
V.  Gore,  &c.  Ins.  Co.  425 

r.  Indiana  Mut.  Fire  Ins.  Co. 

266,  269,  548,  554,  563 

17.  Norwood  287  C 

McCullough  V.  Talladega  Ins.  Co.    591 

Iviii 


Section 
MacCutcheon  r.  Ingraham  87  A 

McCutcheon's  Appl.  391  A,  459  ±J 

McDermott  v.   Centennial   Mut.^ 

Life  Ass.  "-'^^  " 

McDonald  'v.  Adm'r  of  Black       452  E 

V.  Bankers'  L.  Ass'n  327,  465 

V.  Black  452  B 

I'.  Law   Union  Fire   &  Life 

Ins.  Co.  206 

V.  Loan,  &c.  Ins.  Co.  185 

I'.  Phila.  F.  Ass'n  126 

V.  Triple  Alliance  407 

McDonell  v.  Beacon  Fire  &  Life 

lus.  Co.  207,  364 

McDonnell  v.  Ala.  Gold  Life  Ins. 

Co.  344  D,  594  a 

V.  Carr  357 

McDougal   V.  Provident  Sav.  L. 

Ass'n  356  A 

McDowell  V.  JEtna.  Ins.  Co.  494 

Mace  V.  Life  Ass.  188  B 

McElroy  v.  British  America  Ass. 

Co.    137  A,  144  D,  294  E,  360, 
368 
v.  Continental  Ins.  Co.  479 

V.  John  Hancock  Mut.  L.  Ins. 

Co.  276  A,  379,  465 

McElwee  v.  New  York  Life  Ins. 

Co.  399  N 

McEvers  v.  Lawrence  402,  594 

McEvoy  V.  Nebraska  &  Iowa  Ins. 

Co.  345  E 

McEwan  v.  Western  Ins.  Co.  267 

McEwen  v.  Montgomery  Co.  Mut. 

Ins.  Co.  152,  368 

McFarland  v.  Creath  398  A 

V.  Kittanning  Ins.  Co.  294  E,  469  C 
V.  Peabody  Ins.  Co.  215  A,  502,  504 
V.  St.  Paul  F.  &  Ins.  Co.  239  A 
V.  U.  S.  Mut.  Ace.  Ass'n  465 

McFetridge  v.  American  F.  Ins. 

Co.  294  E,  434 

V.  Phenix  Ins.  Co.  287  B 

McGibbon  v.  Imp.  Fire  Ins.  Co.  423  B 
McGinley  v.  U.  S.  Life  Ins.  Co.  299 
McGivney  v.  Phoenix  Fire  Ins.  Co.  87 
McGlincliey  v.  Fidelity  and  Cas- 
ualty Co.  517  A 
Mc(Jlother  v.  Provident  Mut.  Ace. 

Co.  517  A 

McGonigle    v.  Agricultural  Ins. 

Co.  294  E 

V.  Susquehanna  Mut.  F.  Ins. 

Co.    125,  151,  230,  294  E,  405, 
465,  471 
McGovern  v.  Hoesback  25 

McGraw  v.  Germania  Fire  Ins.  Co.  67  J, 
124  A,  476 
McGuire  v.  Hartford  F.  Ins.  Co.  144  A 
McGurk  0.  Metro.  Life  lus.  Co.        502 


TABLE   OF   CASES. 


[The  references  are  to  the  sections.] 


Section 
McHale  v.  McDonnell  83, 112,  879 

Machette  v.  N.  E.  Ins.  Co.  576 

Mac-liine  Co.  r.  Ins.  Co.  55  A,  360 

Mclloney  v.  German  Ins.  Co.  144  D 
McHugh  I'.  Imp.  Fire  Ins.  Co.  566 

Mclntire  v.  Norwich  Fire  Ins.  Co.  269  a 
V.  Plaisted  449 

V.  Preston  549 

Maclntvre  v.  Cotton  States  Life 

Ins.  Co.  566  C 

Mclntyre  v.  Mich.  State  Ins.  Co.  137  A, 

345  E 
Mack  V.  Lancashire  Ins.  Co.  424,  583 
V.  Rochester  German  Ins.  Co.  240 
McTvean  v.  Com.  Union  Ins.  Co.  471 
McKee  v.  Phoeni.x  Ins.  Co.  107  b,  363  A, 
429,  567,  568 
McKelvy    v.     German-American 

Ins.  Co.  36  i 

McKenna  v.  State  Ins.  Co.  356  A 

McKenty  v.  Universal  Life  Ins.  Co.  115 
McKenzie  v.  Planters'  Ins.  Co.  591 

r.  Scottish  Union  &  N.  Ins.  Co.  252 
Mackenzie  v.  Whitworth  12 

Mackie  v.  European  Ins.  Co.  58 

McKinney   v.  German    Mut.    F. 

Ins.  Society  345  E 

MacKinnon  v.  Mutual  F.  Ins.  Co.  200 
McKissick  v.  Mill  Owners' Ins.  Co.  269o 
McLachlin  v.  .Etna  Ins.  Co.  60,  365,  370 
McLanahan  v.  Universal  Ins.  Co.  215  D 
McLaren  v.  Hartford  Fire  Ins.  Co.  264, 

269  a 

McLaughlin  r.  Atlantic  Ins.  Co.    29  A 

V.  Equitable  L.  Ass.  Society    &9a 

r.  McLaughlin  399  0 

I'.  Wash.  Co.  Mut.  Ins.  Co.  428,  475 

McLean  v.  Piedmont,  &c.  Ins.  Co.  356, 

499 

V.  Republic  Ins.  Co.  67  L 

McLeod  V.  Citizens'  Ins.  Co.      287,  477 

McLoon  i).  Com.  Mut.  Ins.  Co.  156 

McMahon  v.  Portsmouth  Fire  Ins. 

Co.  366,  368 

V.  Trav.  Ins.  Co.  345  B 

McManus  v.  .Etna  Ins.  Co.  468 

McMaster  v.  Ins.  Co.  of  N.  A.  465,  477, 

507 
V.  New  York  L.  Ins.  Co.  21,  144  D, 
159,-356  A 
McMasters   v.    Westchester    Co. 

Mut.  Ins.  Co.  468 

McMurdy  v.  Conn.  Ins.  Co.  578 

McMurray  v.  Capital  Ins.  Co.  248, 294  E 
McNally  v.  Phoenix  Ins.  Co.  247,  469  C 
McNeilly  v.  Continental  Life  Ins. 

Co.  126 

McNierney  v.  Agr.  Ins.  Co.  253  B,  294  G 
Macomber  v.  Cambridge  Mut.  F. 
Ins.  Co.  269  a 


Section 
Macomber  v.  Charter  Oak  Fire 

Ins.  Co.  238 

V.  Howard  Fire  Ins.  Co.     233,  242 
McPherson  v.  Proudfoot  456 

McPike    V.   Western   Assurance 

Co.  138 

McQueen  v.  Phcenix  Mut.  Ins.  Co.  23, 
264,  446 
McQuitty  V.  Cont.  Life  Ins.  Co.    29  A, 
344  E,  345  E 
MacRobbie  v.  Ace.  Ins.  Co.  531 

McSwiney  ?>.  Royal  Exch.  Ass.  Co.  83  a 
Mactier  v.  Frith  47 

Macy  V.  Whaling  Ins.  Co.  179  A,  420  A 
Madison  Ins.  Co.  v.  Fellowes  369,  483 
Madsden  v.  Phoenix  Ins.  Co.  255,  468 
Mahar  v.  Hibernia  Ins.  Co.      465,  477, 

566,  579 

Mahon  v.  Mut.  Ins.  Co.  287 

Mahony  v.  Nat.,  &c.  Life  Ass.  497 

Mahr  v.  Bartlett  379 

V.  Norwich    Union     F.   Ins. 

Society  379 

Maier  v.  Fidelity  M.  L.  Ass'n   298,  513 
V.  Railway  Pass.  Ins.  Co.  531 

Mailhoit  ;'.  Met'n  L.  Ins.  Co.  567 

Maine  Benefit  Ass.  v.  Parks  295 

Maine  Mut.  Ins.  Co.  v.  Scranton       549 
Maine  Mut.  Mar.  Ins.  Co.  v.  Neal     5-59 
V.  Stockwell  345  G 

Malicki     v.    Cliicago     Guaranty 

Fund  L.  Society  299,  306 

Malleable  Iron  Works  v.  Phoenix 

Ins.  Co.  120,  129 

Malley  v.  Atlantic  Ins.  Co.  .  279 

Mallory  v.  Farmers'  Ins.  Co.  291 

V.  Ohio  Farmers'  Ins.  Co.         67  G 

I'.  Travelers'  Ins.  Co.  202,20-3,215, 

296,  315,  322,  325,  419,  517 

Maloy  V.  Met'n  L.  Ins.  Co.  -360 

Malt  V.  Rom.  Cath.  Mut.,  &c.  Ins.     502 

Manby  v.  Gresham  Life  Ins.  Co.       496 

Manchester      F.     Ass.     Co.     v. 

Abrams  287  B 

V.  Feibelman  30,  287  B 

V.  Glenn  189,  -379 

V.  Koerner  189,  452  F 

Mandego  v.  Centennial  Mut.  Life 

Ass.  360  F 

Maneely  v.  Knights  of  B.  399  E 

Manhattan  Fire  Ins.  Co.  v.  Stein     264, 

365  a,  505 

V.  Weill  287 

Manhattan  Ins.  Co.  v.  Barker  287 

V.  Webster  99,  130,  131 

Manhattan  Life  Ins.  Co.  v.  Brough- 

ton  307,  322,  m 

V.  Carder  187 

V.  Fields  46.5 

V.  Francisco  296 

lix 


TABLE   OF   CASES. 


Section 
Manhattan  Life  Ins.  Co.  v.  Ben- 

V.  IliK-lyle  £^5« 

V  Siuitli  356  A,  358,  399  P 

r   Warwick     30,  39,  39  A,  40,  350, 

360 

V.  Willis  181,  501 

ve  c.  Com'l  Mut.  F.  Ins.  Co.     Gt 

r.  Herkimer  County  Mut. 
Co.  447 

Mnnsfield  r.  Stevens  459  G 

Maiisoii  V.  Grand  Lodge  560  B 

iMaii-ur  V.  N.  E.  Mut.  Mar.  Ins. 

Co  401 

Maiiton  r.  Robinson  69  a 

Manufacturers'  Ace.  I.  Co.  v.  Dor- 

gan  158,  298,  531  ^ 

Manufacturers',  &c.    Ins.   Co.   v. 


Manl( 

Mann 

ills. 


Armstrong 
V.  Gent 
v.  Kunkle 

V.  Western  Ass.  Co. 
Manx  i:  Nat.  Mar.  Ins.  Co. 
Ma  pes  )•.  Coffin 
Marbleliead  Mut.  Fire  Ins.  Co.  v. 

Hay  ward  559 

V.  Underwood  145,  558 

March  r.  Met'n  L.  Ins.  Co.     156,  186, 

187,  298 

Marchesseau  ??.    Merchants'  Ins. 

Co.  4-28,  477 

Marcus  v.  St.  Louis  Fire  Ins.  Co.     129, 

135,  136,  395,  396 

Harden  v.  Hotel  Owners'  Ins.  Co.      66 

Mareck  v.  Mutual  Reserve  Fund 


[The  references  are  to  the  sections.] 

Section 
Marshall  v.  Thames  Fire  Ins.  Co.  583 
Marsliinson  v.  North  British,  &c. 

Ins.  Co.  447,  502 

Marskey  v.  Turner  360 

Marston  v.  Kennebec  Mut.  L.  Ins. 

Co.  186 

V.  Mass.  Life  Ins.  Co.  504  A 

Martin  v.  JEtna,  Life  Ins.  Co.  133, 399  G, 

567 
V.  Capital  Ins.  Co.  30,  405 

11.  Farmers'  Ins.  Co.  151,  257 

i^.  Fishing  Ins.  Co.  469,  469  C 

V.  Franklin  Fire  Ins.  Co.  378,  379, 
447,  580 
V.  Home  Ins.  Co.  70  a 

V.  Jersey  City  Ins.  Co.  133  E, 

246  A, 372  B 
V.  Mut.  Fire  Ins.  Co.  145 

V.  Penobscot  Mut.  Fire  Ins. 

Co.  491 

V.  State  Ins.  Co.  156,  287  C,  488 
V.  Stubbings  75  B,  399  E,  399  O 
V.  Tradesmen's  Ins.  Co.  122 

V.  Travellers'  Ins.  Co.  514 

Martine  v.  International  Life  Ins. 
Co.  40, 126,  345,  350 


240 

400 

218 

12  B 

45  a 

459  F 


L.  Ass'n 

327 

,478 

Maril  v.  Conn.  F.  Ins. 

Co. 

177, 

239, 

239  A 

Marine  Ins.  Co.  v.  St. 

Louis, 

&c. 

Ry.  Co. 

453 

V.  Winemore 

93  A 

Marion  v.  Great  Rep. 

Ins. 

Co 

477 

V.  Universal  Life  Ins. 

Co 

511 

Mark  v.  JFJna  Ins.  Co. 

413 

V.  Nat.  Fire  Ins.  Co.        294  E,  492 

Markey  v.  Mut.  Ben.  Life  Ins.  Co.     56, 

126,  566 

Markle  i'.  Niagara  Ins.  Co.  475 

Marks  v.  Cass  Co.  Mill,  &c.  Co.    179  D 

V.  Hamilton  92 

V.  Hope  Mut.  Ins.  Co.  58 

Marland  v.  Royal  Ins.  Co.  123 

Miirquis  of  Winchester's  Case         320 

Marsden    v.    City    and  Country 

Ass.  Co.  138  C,  404 

Marsh  i'.  Robinson  447  A 

Marshall  v.  Columbia  Mut.  Ins. 

Co.  14.3, 180  a,  287 

r.  Emperor  Life  Ass.  Co.  691 

V.  Reading  F.  Ins.  Co.  151 

Ix 


Martine.au  v.  Kitching  4.36 

Marts  V.  Cumberland  Ins.  Co.       276  C 
Marvin  v.  Bossiere  29  A 

V.  Brooks  344  D 

V.  Stadacona  Ins.  Co.  67,  447 

Marx  V.  Travelers'  Ins.  Co.  524  A 

Maryland  Fire  Ins.  Co.  v.  Jusdorf    502, 

511 

V.  Stone  172  A 

V.  Universal  Life  Ins.  Co.       137  A 

V.  Whiteford      198,  245,  253  B,  408 

Maryland    Home  F.  Ins.   Co.  v. 

Kimmell  566 

Maryland  Ins.  Co.  v.  Bathurst  469 

Mason  v.  Agr.,  &c.  Ass.  Co.  292,  373, 477 

V.  Andes  Ins.  Co.  365, 466 

V.  Citizens',  &c.  Ins.  Co.      341,  468 

I'.  Franklin  Ins.  Co..  420 

I'.  Hamilton  Ins.  Co.  478 

V.  Hartford  Fire  Ins.  Co.  239 

V.  Harvey  465 

V.  La.  St.  Mar.  &  Fire  Ins.  Co.     589 

i\  Mason  465 

I}.  Sainsbury  453,  454,  455 

Masonic  Ben.  Ass'n  i:  Bunch        399  O 

Masonic  Mut.  B.  Soc.  v.  Beck  502 

V.  Burkhart  399  M 

Masons'  Benevolent  Soc.  v.  Win- 

throp  550  a 

Masons'  Union   L.  Ins.  Ass'n  v. 

Brockman  299 

Mass.  Benefit  L.  Ass'n  v.  Hale        478 

V.  Robinson        70  C,  175,  30.3,  327, 

345  E,  478 


TABLE    OF   CASES. 
[The  references  are  to  the  sections.] 


Section 
Mass.  Benefit  L.  Ass'n  v.  Sibley  55  A 
Massachusetts    Catli.    Order     of 

Foresters  v.  Callahan  399  H 

Massachusetts    Life  Ins.    Co.    r. 

Eshelman  l"**  1^ 

Massasoit  Mills  v.  Western  Ass. 

Co.  ,    ,  6/ 

Massev  v.  Cotton  States  Life  ins. 

Co  '  ^^^ 

Masten  r.  Amerman  .1^ 

Master  v.  Miller  ^'' 

Masters  r.  Madison  Co.  Mut.  Ins. 

Co.  140,143,210,259,267,291 

Mathewson  v.  Royal  Ins.  Co.  83  a 

Matson  r.  F.  rm  Buildings  Ins.  Co.   241 

V.  Travellers'  Ins.  Co.  520  A 

Matt  V.  Roman  Cath.  Mut.  Prot. 

Soc.  170 

Matter  of  Booth  345  B,  399  V 

Matter  of  Newland  449 

Matter  of  People's  Mut.  Eq.  Fire 

lus.  Co.  67 

Matter  of  Webb  ^  39o 

Matthes  v.  Imperial  Ace.  Ass'n     531  A 
Matthews    v.  American    Central 

Ins.  Co.  465 

V.  Gen.  Mut.  Ins.  Co.  of  N.  Y.  4-52  F 

V.  Howard  Ins.  Co.         411  A,  417 

V.  Huntley  ^83 

V.  Ins.  Co.  343 

r.  Queen  City  Ins.  Co.  44;j 

Matthewson  v.  Western  Ass.  Co.      424 

Mattocks  V.  Des  Moines  Ins.  Co.  285, 370 

Mattoon  Manuf.  Co.  r.  Oslikosh      43  F 

Mauser  v.  Holyoke  Mut.  Fire  Ins. 

Co  172  A, 579  B 

Mawliinney  v.  Southern  Ins.  Co.   401  a 

May  V.  Buckeye  Mut.  Ins.  Co.  132, 143, 

■^  159,  250 

V.  Standard  Ins.  Co.        180  a,  274 

V.  Western  Ass.  Co.  213 

Mayall  v.  Mitford  178,  253 

Mayer  v.  Att'y-Gen.  504  a 

V.  Equitable  Life  Ass.  552 

V.  Equit.  Reserve  Fund  Life 

Ass.  295 

V.  Le grand  456 

V.  Mut.  Life  Ins.  Co.   154,  356,-361 

Mnyhew  v.  Phcenix  Ins.  Co.  452  F,  575 

Maynard  v.  Johnson  25 

r.  Rhode  12.3,212,213,304 

Mayor  v.  Lord  459 

Mayor  of  N.  Y.  v.  Hamilton  Ins. 

Co.  246  A,  479 

V.  Hamilton  Mut.  Ins.  Co.        219, 
231,242,487 
Mayor,  &c.  of  N.  Y.  v.  Brooklyn 

Fire  Ins.  Co.  84,  85,  192 

V.  Exchange  Fire  Ins.  Co.  85 

24G  A 


Section 
Meacham  v.   N.   Y.   State    Mut. 

Benefit  Ass.  299,  325 

Mead  v.  Davidson  45  a 

V.  Northwestern  Ins.  Co.  234,  245, 

262 
V.  Phenix  Ins.  Co.  420 

V.  Westchester  Fire  Ins.  Co.      506 
Meadowcraft   v.    Standard    Fire 

Ins.  Co.  142,  401  a 

Meadows  v.  Hawkeye  Ins.  Co.      276  C 

V.  Pacific  M.  L.  Ins.  Co.         531  A 

Mears  v.  Humboldt  Ins.  Co.  239 

Mechanics',  &c.  Ins.  Co.  v.  Floyd     242, 

263  A,  305 

V.  Hodge  240 

Mechanics',  &c.  Soc.  i-.  Gore  Dist. 

Ins.  Co.  378 

Mechanics'  Fire  Ins.  Co.  v.  Nichols  434, 

465 
Mechler  v.  Phoenix  Ins.  Co.  82,  501 
Meoke  v.  Life  Ins.  Co.  of  N.  Y.  567 
Medcalf  I".  Brooklyn  Life  Ins.  Co.  576 
Medina   v.   Builders'   Mut.   Fire 

Ins.  Co.  420  A 

Medina  Ins.  Co   v.  Palm  58 

Meesman  v.  State  Ins.  Co.  479 

Meier  v.  Meier  349  A 

Melin  v.  Ace.  Ins.  Co.  360  C 

Mellen  v.  Eagle  L.  &  H.  Ins.  Co.      504 
V.  Hamilton  Fire  Ins.  Co.  152, 

368,  370,  386 
Mellows  V.  Mellows  399  O,  459  D 

Melville    Mut.  Fire  Ins.    Co.    r. 

VVilgus  287  C 

Menk  v.  Home  Ins.  Co.    ^  144  A 

Menneiley  v.  Employers'  L.  As. 

Corp.  324,  517  A,  523  A 

Mensing  v.  Amer.  Ins.  Co.     137  A,  469 
Mentz  V.  American  Fire  Ins.  Co.      495 
r.  Lancaster  Fire  Ins.  Co.  126 

Menzies  v.  North  Brit.  Ins.  Co.  423 

Mercantile  Ins.  Co.  v.  Holthaus       466, 

468 
Mercantile     Mut.     Ins.     Co.    v. 

Calebs  467  B 

Merchants'  &  Manuf.  Ins.  Co.  v. 

Curran  501 

V.  Wash.  Mut.  Ins.  Co.      200,  207, 
241,  591 
Merchants'  &  Mechanics'  Ins.  Co. 

V.  Schroeder  162 

Merchants'    Cotton-press    Co.    v. 

Ins.  Co.  of  North  America  95  A 

Merchants'  Ins.'Co.  v.  Brown  274 

V.  Clapp  567 

V.  Davenport  172  A 

V.  Edmand  ,  174 

V.  Gibbs  466 

V.  New  Mexico  Lumber  Co.      2.39 
V.  La  Croix  478,  489 

Ixi 


TABLE   OF   CASES. 


Section 
456 
67  L 


93 

549  6 

22 

11 

549  b 

579 


Merchants'  Ins.  Co.  v.  Mazange 

I'.  Prince 
Merchants'  xMut.  Ins.  Co.  v.  Bar 
ing 
V.  Leeds 
V.  Lyman 

r.  M.  O.  Mut.  Ins.  Co. 
V.  Uey 
V.  Wilson 
Merchants',  &c.  Ins.  Co.  v.  Vin- 

ing  f  5'  4^9 

Merchants',  &c.  Trans.  Co.  v.  As- 
sociated Firemen's  Ins.  Co.        4^1  a 
Merrett  r.  Farmers'  Ins.  Co.  ol 

i;.  Preferred    Masonic    Mut. 

Ace.  Ass'n  325 

Merriam  v.  Middlesex  Mut.  Fire 

Ins.  Co.  195,  1.20,  223,  580 

Merrick  v.  Brainard  455 

1-.  Germania  Fire  Ins.  Co      13,  4o5, 

436 

239 

291,  292 

83,  379, 

463 

I'.  Farmers'  Ins.  Co.  397 

f.  N.  !<:.  Mut.  Life  Ins.  Co.        390 

Merry  r.  Prince  1^ 

Mers  r.  Franklin  Ins.  Co.  285,  288 

Merserau   r.  Phoenix    Mut.   Life 

Ins.  Co.  126, 138,  511 

Mershon  v.  Nat.  Ins.  Co.  448 

Messelback  i-.  Norman  247 

Mesterman  v.  Home  M.  Ins.  Co.       368 
Metallic,  &e.    Co.    v.    Fitchburg 

R.  R.  Co. 
Met'n  Ac.  Ass'n  v.  Froiland 
Met'n  Ins.  Co.  v.  Rutherford 
Met'n  L.  Ins.  Co.  v.  Anderson 


Ins.   Co.  V. 


Michigan 
Co.  V 


87  A 
594 

322 

567 

125 


State 
239,  401  B 


V.  Provincial  Ins.  Co. 
Merrill  v.  Agr.  Ins.  Co. 

V.  Colonial  M.  F.  Ins.  Co 


V.  Dempsey 

V.  Drach 

V.  McCormick 

V.  McNall 

V.  McTague 

V.  Monahon 

V.  MuUeady 

V.  O'Brien 

V.  Shaffer 

V.  Trende 
Met'n  Safety  Fund  Ace.  Ass'n  v. 

Windovcr 
Meyer  '•.  Queen  Ins.  Co. 
Mt-yer-Bruns  i-.  Penn.  M.  L.  Ins. 

Co. 
Meyers  v.  Schumann 
Miaghan  v.  Hartford  Fire  Ins.  Co. 

294  E,  465 
Miall  V.  Western  Ins.  Co.  379 

Miami,  &c.  Ins.  Co.  v.  Stanhope     274 

Ixii 


[The  references  are  to  the  sections.] 

Section 

Michael  v.  Mut.  Ins.  Co.  of  Nash- 
ville 143,  359 
V.   St.  Louis   Mut.   Fire  Ins. 
Co. 
Michenor  v.  Payson 
Michigan    Mut.    L. 
Naugle 
I'.  Reed 
Michigan   Pipe  Co. 

F.  &  M.  Co. 
Michigan    Shingle 

Inv.  «Sb  Ins   Co. 
Michigan  St.  Ins.  Co.  v.  Lewis        272, 
497,  499,  511 
Michigan,  &c.  Ins.  Co.  v.  Bowes     344  a 
Mickey    v.  Burlington   Ins.   Co.     255, 
^  408,  488 

Mickles  v.  Rochester  City  Bank   , 

459  A 
Midland  Ins.  Co.  v.  Smith  407  A,  457 
Mildmay  v.  Folgham  6 

Miles  V.  Conn.  Mut.  Life  Ins.  Co.     201, 
204,  205,  340 
Milkman  v.  United  Mut.  Ins.  Co.     230 
Millard  v.  Supr.  Council  of  Am. 

Leg  of  Honor  469,  502 

Millaudon  v.  Atlantic  Ins.  Co.   424,  492 

493 

V.  Orleans  Ins.  Co.  415,  416 

V.  West  Mar.  &  Fire  Ins.  C.     13,  31 

Miller  v.  Alliance  Ins.  Co.    87  A,  287  C, 

373  C 

V.  Amazon  Ins.  Co.  287  C 

V.  Brooklyn  Life  Ins.  Co.  359, 

360 

V.  Campbell  66,  386,  399  Q 

V.  Confederation  Life  Ass.  Co.  161 

V.  Eagle  Life  &  H.  Ins.  Co.     7,  106, 

109,  466,  475,  476 

V.  Fidelity  &  Cas.  Co.  324 

V.  Germania  Fire  Ins.  Co.     30,  250, 

292 

V.  Hartford  Ins.  Co.     133  A,  133  B, 

465,  479 

V.  Hillsboro'  Mut.  Fire   Ins. 

Co.  552 

V.  Life  Ins.  Co.  360  B 

V.  Morrow  25 

V  Mut  Ben.  Life  Ins.  Co.     143,  144 

144  G,  164,  183,  185,  186,  301, 

419,  499,  581 

V.  Phcenix  Mut.  Life  Ins.  Co.      305 

V.  Scottish  Union  Ins.  Co.  126 

V.  Travelers'  Ins.  Co.  524  A 

V.  Union  Central  Life  Ins.  Co.     353 

V.  Western,  &c.  Ins.  Co.  244 

Millers'  National  Ins.  Co.  v.  Kin- 

neard  452  F 

Milligan  v.  Equitable  Ins.  Co.     87 

V.  Goddard  510 


459 

324 

465 

16, 

287  B 

298,  479 

175,  424  A 

67 

578  a 

70  C,  178,  304 

112,  399  Q 

126 

379 

399  K 

112 


222 

187 
398 


TABLE    OF   CASES. 
[The  references  are  to  the  sections.] 


Section 
Milliken  v.  Woodward  447  A 

Mills  V.  Fanners'  Ins.  Co.    101,  219,  278, 
401  a,  420 
V.  Rebstook  324 

Milner  r.  Bowman  399  E 

Miltenberger  i\  Beacom    85, 122  A,  456 
Milwaukee  >:.  Kelloijg  417  A 

Milwaukee  Mechanics'  Ins.  Co.  v. 

Gralmni  364 

V.  Ketterlin  6,  273 

V.  Palatine  Ins.  Co.  566 

Miner  v.  Judson  555 

V.  Midi.  Mut.  Ben.  Ass.  175 

V.  Phoenix  Ins.  Co.  136,  14.3,  452  A, 

499 
V.  Ta.sfert  30 

Minneapolis  Threshing  Macliine 

Co.  V.  Firemen's  Ins.  Co.  230 

Minn.  Title  Ins.  Co.  v.  Dre.xel  67 

Minnock  v.  Eureka  F.  &  M.  Ins. 

Co.  364,  369 

Minor,  Ex  parte  4.56 

Minturn  v.  Manufactures'  Ins.  Co.   379 
Miotke  V.  Milwaukee  Mechanics' 

Ins.  Co.  287  B 

Mispelhorn  v.  Farmers'  Ins.  Co.       475 
Missell  r.  Globe  Mut.  Ins.  Co.  356 

Misseliiorn  c.  Mut.  Reserve  Fund 

Life  Ass.  55  A 

Miss.  Mut.  Ins.  Co.  v.  Ingram  423 

Mississippi,  &c.  Life   Ins.  Co.   v. 

Neylaiid  1.34 

Missouri  Valley  Life  Ins.  Co.  v. 

Dunklee  360  D 

Missouri,  &c.  Ins.  Co.  v.  Sturges      398 
Mitchell  V.  Grand  Lodge,  K.  of  L. 

399  E 
V.  Home  Ins.  Co.  76,  84 

V.  Lycoming  Mut.  Ins.  Co.        ioi, 
153,  365,  552 
V.  Minnesota  F.  Ass'n  1.38 

i;.  Mut.  Life  Ins.  Co.  of  N.  Y.     .37, 

338 
V.  Orient  Ins.  Co.  138 

V.  Union  Life  Ins.  Co.  105,  107,422 
Mitciiell,  &c.  Co.  V.  Imperial  Fire 

Ins.  Co.  172  A 

Mix  L\  Andes  Ins.  Co.  479 

V.  Royal  Ins.  Co.  469  C 

Moadinger  i.-.  Mech.  Fire  Ins.  Co.   420, 

477 
Moakley  v.  Riggs  156 

Mobile  Ins.  Co.  u.  Brame  458 

Mobile  Life  Ins.  Co.  v.  Morris  214 

r.  Pruett  502 

V.  Walker  169 

Mobile   Mar.  D*:ck  v.   Mut.  Ins. 

Co.  22 

Mobile  Mar.  Dock  &  Mut.  Ins.  Co. 
V.  Mc  Mil  Inn  23  C,  400 


Section 

Mobile,  &c.  Ins.  Co.  v.  Coleman    180  a 

V.  Miller  130 

Mobile,  &c.  Ry.  Co.  v.  Jurey  453,  457  A 

Moch  V.  Virginia   Fire,  &c.  Ins. 

Co.  577 

Modern    Woodman    Ace.    Ass'n 

V.  Shryock  515  « 

Modern  Woodmen  y.  Jameson  159 

Modern  Woodmen  Ace.  Ass'n  v. 

Rhine  55  A 

Moehring  v.  Mitchell  391 

Moeller  v.  American  F.  Ins.  Co.  566 
Moffit  V.  Phenix  Ins.  Co.  386 

Mohr,  &c.    Distilling  Co.  v.  Ins. 

Co.  569  A 

Jloise   V.   Mutual  Reserve   Fund 

L.  Ass'n  386 

Moliere  v.  Penn  P'ire  Ins.  Co.  129,  149, 

262,  566 
Monad  nock  R.  R.  Co.  v.  Manuf. 

Ins.  Co.  94 

Monaghan  v.  Agr.  Fire  Ins.  Co.    35  A, 

188  B,  277 

Monitor  Ins.  Co.  I'.  Buff  um  122  A, 

560  A 
Monk  V.  Union  Mut.  Life  Ins.  Co.     212, 

304 
Monmouth  Ins.  Co.  v.  Hutchinson  454 
Monmoutli  Mut.  Fire  Ins.  Co.  v. 

Lovell  557 

Monnica  v.  German  Ins.  Co.  459  D 
Monroe  I'.  Southern  Mut.  Ins.  Co.  424  A 
Montague  v.  Tidcombe  540 

Monteleone  v.  Royal  Ins.  Co.  240, 421  a 
Montgomery  v.  Charleston  453 

f.  Firemen's  Ins.  Co.      172  A,  415 
V.  Phoenix,  &c.  Ins.  Co.  344  a 

Montgomery    County     Farmers' 

IMut.  Ins.  Cor  r.    Milner  557 

Monticello  v.  Mollison     .  454,  455 

Montreal  Ins.  Co.  v.  McGillivray      15, 

20,63 
Montrose  v.  Roger  Williams  Ins. 

Co.  1.38  C 

Moody  V.  JEtna  Ins.  Co.  466 

V.  Amazon  Ins.  Co.  247 

V.  Ins.  Co.  247,  248 

Mooney  v.  Howard  Ins.  Co.  579  B 

Moore  v.  Charter  Oak  Life  Ins. 

Co.  66 

V.  Conn.  Mut.  Fire  Ins.  Co.       240, 
296, 325 
V.  Hanover  F.  Ins.  Co.    263  E,  449 
V.  Ins.  Co.  240  G 

V.  Phoenix  Ins.  Co.  248 

V.  Prot.  Ins.  Go.  2-39,  642,  466,  477 
V.  Rockford  Ins.  Co.  126,  360 

V.  State  Ins.  Co.  478 

V.  Susquehanna  Mut.  F.  Ins. 

Co.  465 

Ixiii 


TABLE  OF  CASES. 


[The  references  are  to  the  sections.] 

c_„4.; Section 

Moulthrop  V.  Farmers'  Mut.  Fire 

Ins.  Co.  282  A,  364  A 

Mound  City  Ins.  Co.  v.  Huth  346 

477  '  Mound  City  Mut.  Fire  Ins.  Co.  v. 

Woolsev    57,111,323,324,395,        Ciirran  63 

vvooisey    oi,  i    ,  ^^.    Mound  City,&c.  Ins.  Co.  v.  Twin- 


Moore  i'.   Union  Fraternal  Ace. 
Ass'n 
V.  Virginia  Fire,  &c.  Ins.  Co. 


156 

189, 


Moosley  v.  Ins.  Co. 

More   c.   New   York  Bowery  F. 

Ins.  Co. 
Morel  V.  Miss.  Val.  Life  Ins.  Co. 


184 


344  a 
71 


409, 
530 
346 
25 
496  B 
248 


Morey  v.  N.  Y.  Life  Ins.  Co. 
Morgan  v.  Mather 

r.  Merchants'  Ins.  Ass'n 
Moriarty  v.  Home  Ins.  Co. 
Morland  v.  Isaac  449,  459  A 

Morley  v.  Liverpool,  &c.  Ins.  Co.     386 
Morotock  Ins.  Co.  v.  Cheek  287  B,  465 

r.  Kodefer  202,  270,  285 

Morrell  v.  Irving  Fire  Ins.  Co.    423, 


433 
109 


V.  Trenton  Mut.  Life  &  Fire 
Ins.  Co. 
Morris  r.  Farmers'  Mut.  F.  Ins.  | 

Co.  239  A  I 

r.  Imperial  Ins.  Co.  283,  285  j 

V.  Orient  Ins.  Co.  368  j 

V.  Penn.,  &c.  Ins.  Co.  344  «  | 

V.  Tenn.,  &c.  Ins.  Co.  290 

Morrison  v.  Ara.  Pop.  Life  Ins. 

Co.  69  a 

V.  Ins.  Co.  370,  560  A 

V.  Muspratt  195,  212,  213 

V.  Scot.  Emp.   Life   &  Ace. 

Ass.  Co.  (Lim.)  402 

V.  Tenn.  Mar.  &  Fire  Ins.  Co.    101, 

269,  272,  285 

V.  Universal,  &c.  Ins.  Co.  497 

V.  Wis.  0.  F.  Mut:  Life  Ins. 

Co.  64  A,  295,  502 

Morrow  v.  Des  Moines  L.  Ins.  Co.  345  e 
Morse  v.  Buffiilo  Fire  &  Mar.  Ins. 

Co.  239 

V.  Minn.,  &c.  Railway  Co.        23  C 
V.  St.  Paul's  Fire  &  Mar.  Ins. 

Co.  126 

Morville  v.  American  Tract  So- 
ciety 496  B 
Moser  v.  Brooklyn  Life  Ins  Co.       342 
y.  Phcrnix.&c.  Ins.  Co.  341 
Moses  V.  Delaware  Ins.  Co.  207 
V.  Pratt  567  1 
Mosley  v.  Vt.  Mut.  Fire  Ins.  Co.     185, 
239  A,239B,  465,  469,  583 
Mosness  v.  German  Ins.  Co.  494 
Motley  I'.  Manfrs.  Ins.  Co.        116,  446 
Motteux  V.  London  Ass.  Co.         566  A 
Moulor  r.  Am.  Life  Ins.  Co.      162,  296 
V.  Am.  Pop.  Life  Ins.  Co.  185,  186, 
210,  296 
Ixiv 


ing 
Mount  V.  Waite 
Mount    Vernon    Manuf.    Co.    r. 

Summit  Co.  Mut.  Fire  Ins.  Co.  269  a 

Mowry  v.  Home  Ins.  Co.    75,  299,  345, 

360,  362 

V.  Rosendale  143 

V.  Todd  378 

MuUane  v.  Nat.  Ins.  Co.  158 

Mullin  V.  Vt.  Mut.  Fire  Ins.  Co.  133  D, 

249  G,  477,  587  B 

Mulilne   V.  Guardian   Mut.   Life 

Ins.  Co.  214 

Mullins  V.  Thompson  399  H 

Mulrey   v.   Shawmut  Mut.   Fire 

Ins.  Co.  63,  145 

Mulry   V.   Mohawk    Valley   Ins. 

Co.  580,  591 

Mulvey   v.  Gore  Dist.  Mut.  Fire 

Ins.  Co.  475,  567 

Mulville  V.  Adams  161 

I  Muma  V.  Niagara,  &c.  Ins.  Co.         292 

!  Mumford  v.  Mumford  399  N 

Mund  V.  Ins.  Co.  399  A 

Munger  i'.  Holyoke  Ins.  Co.  366 

r.  People's  Fire  Ins.  Co.  477 

Murdock  v.  Chenango  Co.  Mut. 

Ins.  Co.  158,  220,  281 

V.  Franklin  Ins.  Co.  94  A 

Murphey  v.  American  Mut.  Ac. 

Ass'n  306 

Murphrey  v.  Old  Dominion  Ins. 

Co.  287 

Murphy  v.  American  Central  Ins. 

Co.  421  a 

V.  Harris  212,  305 

I'.  Independent  Order  465 

V.  Mut.  Ben.  Life  Ins.  Co.  585 

V.  People's  Eq.  Mut.  Fire  Ins. 

Co.  294  G 

V.  Royal  Ins.  Co.  126,  263  A 


Murray  i'.  Hatcl 

V.  N.  Y.  Life  Ins.  Co. 
Murry  v.  Wells 
Muse  V.  London  Ass.  Corp. 
Mussey  v.  Atlas  Mut.  Ins.  Co 


Mut. 


Holt 


Ass.  Co.  V. 
V.  Korn 
V.  Mahon 
V.  Montgomery 
V.  Rolfe 
Mut.  Benefit  Ins.  Co. 
V.  Ruse 


421  a 

327  A 

390 

479 

365  a, 

366 

560  A 

63 

567 

399  J\I 

399  F,  399  M 

Newton       465 

355,  582 


TABLE   OF   CASES. 


[The  references  are  to  the  sections,] 


Section 
Mut.  Benefit  Ins.  Co.  r.  Tisdale  465,  585 
Mutual    Benefit  Life   Ins.  Co.  v. 

Cannon  297 

V.  Cliarles  577 

.    V.  Davies'  Ex'rs       141  E,  307,  324 
V.  Davis  551 

V.  Dunn  399  D 

V.  French  342,  345,  502  a 

V.  Hildyard  39 

V.  HoIterliofE  299 

V.  Jarvis  342,  556 

V.  Miller  195,  201 

V.  Robertson  200 

V.  Robison    66  A,  67,  126,  181,  298 
V.  Ruse  29  B,  355,  582 

V.  Wise  186,  187,  202,  303 

Mutual  Benevolent  Ass.  v.  Hoyt     398, 

399  F 
Mutual  Endowment  Asses.  Ass.  v. 

Essender  5G2 

Mutual  F.  Ins.  Co.  v.  Alvord    364,  492, 

494 
V.  Coatesville  176,  289 

I'.  Coatesville  Shoe  Factory       245 
V.  Frey  479 

V.  Miller  Lodge  345  a,  356  A 

Mutual  Hail  Ins.  Co.  i.-.  Wilde  402 

Mutual  Ins.  Co.  v.  Deale    171,  184,  287 
V.  Mahon  567 

V.  Wilde  479,  547  a 

Mutual  Life  Ins.  Co.  v.  Allen       398  A 
V.  Arlielger  303 

V.  Armstrong  407 

V.  Blodgett       112,  187,  305,  399  D 
V.  Bratt  344  H 

V.  Dingley  66,  356  A 

V.  Elliott  358 

V.  Ferry  399  O 

V.  Girard  Life  Ins.  Co.     345  a,  361 
V.  Hay  ward  325 

r.  Jarboe  69  a 

l:  Jeffries  185 

V.  Lawrence  307 

V.  Leubrie  322 

V.  Logan  360 

V.  Nichols  159,  303 

V.  Oliver  359 

V.  Piienix  Ins.  Co.  465 

V.  Phinney  67  A 

V.  Schaefer  9 

t;.  Schmidt  465 

V.  Sears  67  A 

V.  Selbv  187 

V.  Simpson  186,  298 

V.  Snyder  296 

V.  Thomson  55  A,  159,  29'.) 

V.  Tillman  325 

V.  Wager  117,  123,  575 

V.  Wiswell  323 

V.  Young  50,  54 

VOL.  I.  —  e 


Sectiou 
Mutual  Life  Ins.  Co.  of  New  York 

V.  Terry  320,  325 

Mutual  Mill  Ins.  Co.  v.  Gordon    188  C, 

292  B 
Mutua!  Prot.  Ins.  Co.  v.  Hamilton  396 
Mutual  Reserve  Fund  L.  Ass'n  v. 

Hamlin  70  C 

Mutual  Safety  Ins.  Co.  v.  Hone  12,  439 
Myers  v.  Council  Bluffs  Ins.  Co. 

133  A, 469  B 
V.  Keystone  Mut.  Life  Ins.  Co.  53, 
54,  58,  65,  151,  359 
V.    Knickerbocker  Life    Ins. 

Co  576 

t'.  Lebanon  Mut.  Ins.  Co.         188  C 

V.  Liverpool,  &c.  Ins.  Co.  56 

Mygatt  V.  N.  Y.  Prot.  Ins.  Co.  548 


N. 


Nally  V.  Nally  399  O 

Names  i-.  Dwelling-house  Ins.  Co.    189, 

247 
Nantes  v.  Thompson  590 

Nappanee  Furniture  Co.  v.  Ver- 
non Ins.  Co.  222,  420 
Nash  V.  Un.  Mut.  Ins.  Co.  555 
Nashua  Fire  Ins.  Co.  v.  Moore  549  a, 
552,  557 
Nashville  Ins.  Co.  v.  Matthews     344  G, 

344  H 
Nashville  Life  Ins.  Co.  v.  Ewing  136  A 
Nassauer  i-.  Ins.  Co.  124  A,  373  A 

National  Ace.  Society  v.  Dolph        514, 
515  a,  517  A,  518  A,  520  A,  524,  531  A 
Nat.  Ass.,  &c.  V.  Best  399  B 

National  Bank  v.  Graham  15 

V.  Hartford  Fire  Ins.  Co.  ,176 

V.  Ins.  Co.  160,  250 

V.  Union  Ins.  Co.  269 

V.  Whitney  23  D 

Nat.  Ben.  Ass.  v.  Jackson     345  B,  531  A 
V.  Jones  561  A 

National  Filtering  Oil  Co.  v.  Citi- 
zens' Ins.  Co.  94  A 
Nat.  Fire  Ins.  Co.  v.  Crane        384,  566 
V.  Grace  379 
V.  McLaren                                    454 
V.    U.    S.    Building    &    Loan 

Ass'n's  Assignee      245,  469  C 

Nat.  Guar.  Ins.  Co.  r.  Freeman         544 

Nat.  Ins.  Co   i:  Webster  408 

Nat.  Life  Ins.  Co.  v.  Barry  391 

V.  Egan  573 

V.  Haley  399  P 

V.  Jones  575 

V.  Minch    1.33  B,  213,  442,  504,  .575 

V.  Pin  grey  566  C 

Nat.  Mut.  Aid  Soc.  v.  Lupoid        385  A 

Ixv 


TABLE   OF   CASES. 


[The  references  are  to  the  sections.] 
Section 


858 
577 
557 
597 


Xat.  Mut.  Ins.  Co.  v.  Home  Ben- 
efit Society 
V.  Purcell 
I'.  Yeonians 
Nat.  Prot.  Life  Ass.  Soc.  In  re 
National  Traders'  Bk.  v.  Ocean 

Ins.  Co.  566  A 

Naugliter  v.  Ottawa  Agr.  Ins.  Co.     140 

loo 

Nave  v.  Home  Mut.  Ins.  Co.    412,  418, 

421  fl 
138  A 
395 
349  A 
276  B 
386,  466 
341 


292 


298 
400 
465 
454 


Neal  V.  Ewing 

V.  Molineux 
Neale  v.  Albertson 
Neall  V.  ^Etna  Ins.  Co. 
Nease  v.  .Etna  Ins.  Co. 
Neilrow  r.  Farmers'  Ins.  Co 
Neely  v.  Onondaga  Co.  Mut.  Ins. 

Co.  553 

Neill  ".  Travellers'  Ins.  Co.    530,  531  A 
Nelson  v.  Atlanta  Home  Ins.  Co.      364 
V.  Bound  Brook  457 

V.  National  Protective  Society    368 
V.  Nederland  L.  Ins.  Co. 
V.  Sun  Ins.  Co. 
Nepeau  i-.  Doe 
Neptune  Ins.  Co.  v.  Dorsey 
Neskern  v.  N.  W.  Endowment  & 

Ijeg.  Ass.  553  A 

Nettleton    v.   St.    Louis,    &c.    Ins. 

Co.  344  rt,  345  a 

Neuendorf!   v.  World   Mut.    Life 

Ins.  Co.  65,  134 

Neve  V.  Columbia  Ins.  Co.       365,  367, 

420 
Neville  v.  Mer.  &  Man.  Ins.  Co.  51,  566 
Nevins  v.  Rockingliam  Fire  Ins. 

Co.  428,  447,  491,  596 

New  r.  German  Ins.  Co.  379 

Newark  Ins.  Co.  r.  Sammons  67  G 

New  by  v.  Reed  13 

Newcastle  Fire  Ins.  v.  Macmorran   143, 

156 

Newcomb  v.  Almy  899  P,  596 

V.  Cin.  Ins.  Co.  456  a 

V.  Mut.  Life  Ins.  Co.  390 

V.  Provident     Fund    Society 

159,  360 
New  England  Fire  &  Mar.  Ins. 

Co.  V.  Robinson  60 

V.  Schettler      15,  62, 101,  131,  13.5, 

152,  365 

V.  Wetmore    83, 100,  218,  245,  379, 

502 

New   Englnnd  Mut.   Ins.   Co.   v. 

Belknap  552,  5.58,  584 

r.  Butler 
1-.  DeWolf 
New  England  Mut.  Life  Ins.  Co. 
V.  Hasbrook  342,  359 

Ixvi 


Section 
New  Era  Life  Ins.  Co.  v.  Musser  29  C 
Newhall  r.  Union  :Mut.  Fire  Ins. 

Co.  ^.       T 

New  Hampshire  Mut.  Fire  Ins. 

Co.  V.  Noyes  35  A 

V.  Rand  426,  555 

V.  Walker  590 

New   Hampshire,  &c.  Ins.  Co.  v. 

Hunt  „         553 

New  Home  Life  Ins.  Ass.  v.  Hag- 

ler  307, 469 

New  Jersey  Mut.  Life  Ins.  Co.  v. 

Baker  144 

Newman  r.  Cazalet  1 '  3 

V.  Covenant  Mut.  Ins.  Ase.    419  A, 

563  A 

V.   Springfield  Fire   &  Mar. 

Ins.  Co.       151,  166,  167,  285, 
296,  446,  591 
Newmark  r.  Lon.  &  Liv.  Fire  & 

Life  Ins.  Co.  404,  465 

Newmarket  Sav.  Bank  i-.  Royal 

Ins.  Co.  231,  247 

New  Orleans  Ins.  Ass'n  v.  Boniel   43  F 

r.  Griffin  368,  370 

V.  Holberg      279,  370,  379,  385  A 

V.  Matthews       138,  452  F,  469  C. 

497,511 

Newport  Ins.  Co.  v.  Home  Ins. 

Co  240 

Newson  v.  Douglas  122,  452  E 

Newton  v.  Gore,  &c.  Ins.  Co.  373 

V.  Ins.  Co.  325 

I'.  Mut.  Ben.  Life  Ins.  Co.  296,  316, 
325,  460,  465 
New  York  Ace.  Ins.  Co.  v.  Clay- 
ton 158 
New  York  Bow.  Fire  Ins.  Co.  v. 

New  York  Fire  Ins.  Co.     11,  98, 208 
New  York  Central  Ins.  Co.  r.  Nat. 

Protection  Ins.  Co.  125,  134, 
345,  360,  462,  591 
V.  Watson       70  C,  369,  372  F,  507 
New  York  Central  R.  R.  v.  Lock- 
wood  410 
New  York  Express  Co.  v.  Traders' 

Ins.  Co.  417  A 

New  York  Fire  &  Mar.  Ins.  Co.  v. 

Wetmore  245 

New  York  Fire  Ins.  Co.  v.  Delavan  432 
New  York  Firemen's  Ins.  Co.  i'. 

Walden  200 

New  York  Gas  Light  Co.  v.  Me- 
chanics' Fire  Ins.  Co.  192,  423 
New  York  Ice  Co.  v.  N.  W.  Ins. 
Co.  566 
552,  554  !  New  York  Ins.  Co.  r.  Flack      295.  .396 
15,  .383 1         V.  Thomas                                372  F 
New  York  L.  Ins.  Co.  v.  Babcock  3. 55  A 
V.  Baker  187 


TABLE  OF  CASES. 


[The  references  are  to  the  sections.] 


Section 

New  York  L.  Ins.  Co.  v.  Best        578  a 

V.  Boiteaux  302,  419 

i;.  Clopton    37,   38,   39  A,   40,   59, 

345 
V.  Davis  110,  407 

V.  Dingley  340 

V.  Eggleston  346 

V.  Fletcher  125,  137,  145  A 

V.  Graham  183,  188 

V.  Hendren  333,  350 

V.  Ireland  399  Q 

V.  McGowan  133 

V.  McMaster  14,  566 

i;.  Statham         341  a,  350  a,  352  A 
V.  White  350 

New  York  Lumber  Co.  i'.  People's 

F.  Ins.  Co.  70  B 

New  York  Mar.  Ins.  Co.  r.  Prot. 

Ins.  Co.  11,  12 

New  York  Mut.  Ins.  Co.  ;•  Johnson,  53, 

145 
New  York  Mut.  Life  Ins.  Co. 

V.  Armstrong  399  A 

New  York,  &c.  Ins.  Co.  r  Bangs      573 
New  Zealand  Ins.  Co.  i'.  Maaz  360 

Niagara  Dist.  Mut.  Fire  Ins.  Co. 

r.  Lewis  471 

Niagara  Fire  Ins.  Co.  v.  Brown        511 

V.  De  Graff  246,  405 

V.  Drda  249  F 

V.  Forehand  263  A 

V.  Miller  200,  291,  504 

V.  Scammon  274,  364 

Niagara  Ins.  Co.  v.  Elliott  401  C 

Niblo  V.  N.  A.  Fire  Ins.  Co.  79,  81,  285, 

423,  424 

Nichols  V.  Baxter  452  C 

V.  Fayette  Mut.  Fire  Ins.  Co.      31, 

290,  294  D,  365.  501 

V.  Nichols  496  B 

V.  Sun  Mut.  Ins.  Co.  412 

Nicholson  v.  Plicsnix  Ins.  Co.  233 

Nickell  V.  Phcenix  Ins.  Co.     126.  469  D 

Nickerson  r.  Nickerson  459  G,  465 

Nicolet  V.  Ins.  Co.  427 

Nicoll  V.  Am.  Ins.  Co.  122,  181 

Niglitingale  v.  State  Mut.  Life  Ins. 

Co.  336,  496,  572 

Nimick  v.  Mut.  Ben.  Life  Ins.  Co.   307 

312,  316 
Nims  V.  Ford  399  D,  459  E 

Nippolt  V  Firemen's  Ins.  Co.  70  B 

Nolan  V.  Colorado  Cent.  Cons.  M. 

Co.  496  B 

Noonan  v.  Hartford  Fire  Ins.  Co.     466 
Noone    v.    Transatlantic    F.    Ins. 

Co.  401  B 

Norcross  v.  Franklin  Ins.  Co.    267,  268 

Norman  r.  Ins.  Co.  133,  133  F 

V.  WeUs  423  B 


Section 
Norris  v.  Hartford  F.  Ins.  Co.  67 

V.  Ins.  Co.  of  North  America     169 
North  American  Fire  Ins.  Co.  v. 

Throop  143, 185, 188,  203,  209, 
212,  420,  498,  499 
I'.  Zaenger  249  F,  465 

North  American  Ins.  Co.  v.  Bur-    . 

rouglis   465,  466,  514,  532,  536 
V.  Whipple  566  A 

North  American  Life  Ins.  Co.  v. 

Craigen  75  B 

North  Berwick  Co.  v.  Crutchfield 

124  A 
V.  N.  E.  Fire  &  Mar.  Ins.  Co.     126, 
136,  220,  253,  502 
North  British  &  Mercantile  Ins. 

Co.  r.  Bolm  287  B 

V.  Moffatt  97 

V.  Stewart  442 

North  British  Ins.  Co.  v.  Hallett       396 

V.  Lloyd  540 

North  Britisii,  &c.  Ins.  Co.  v.  Liv., 

&c.  Ins.  Co.  436  a,  456  a 

V.  Moffatt  436 

V.  Steiger  246  A,  372  C 

;;.  Stewart  575 

North    Carolina,   &c.   Ins.    Co.  v. 

Powell  559 

Northern  Ass.  Co.  v.  Hamilton       67  L 

1-.  Hanna  465,  478 

V.  Provost  373  A 

North  Lebanon  R.  R.  r.  McGrann    493 

Northrup  v.  Miss.  Valley  Ins.  Co.     23, 

370 
V.  North  Star   Boot   &  Shoe 

Co.  459  F 

V.  Phillips  452  A 

V.  Railway  Pass.  Ass.  Co.  524 

North  Star  Boot  and  Shoe  Co.  v. 

Ladd  459  F 

Northwestern  Benev.  &  Mut.  Aid 

Ass.  V.  Bloom  325 

V.  Cain  162 

r.  Wanner  322,  352 

Northwestern  Ins.  Co.  v.  Atkins    459  G 
V.  Elliott  575,  577 

V.  Muskegon  Bank  299 

V.  Phcenix  Oil  &  Candle  Co.      478 
V.  Roth  442 

Northwestern  Iron  Co.   v.  ^Etna 

Ins.  Co.  23  A,  502 

Northwestern  Life  Ins.  Co.  v.  El- 
liott 66.  477,  575,  577 
Northwestern  Masonic  Aid  Ass'n 

V.  Jones  2 

Northwestern  Mut.  Life  Ins.  Co. 

V.  Amerman  502 

r.  Bank  23  D 

V.  Barbour  69  a,  344  a 

V.  Fort's  Admr.  344  E,  560  B 

Ixvii 


TABLE   OF   CASES. 


Section 

Northwestern  Mut.  Life  Ins.  Co.^ 

i:  Gennania  Fire  Ins.  Co.       o99  K 

t/Sr/u  ao,,4ifA 

..  Koss  ^  1^5 

Northwestern,  &c.  Ins.  Co.  v.  Bon- 

Norton  r.  Phoenix  Mut.  Life  Ins. 

Co.  ""^j  ^^^ 

c.  Rensselaer  &  Saratoga  Ins. 

Co.  474,  475 

Norwich  &N.  Y.  Trans.  Co.  v. 

Western  Mass.  Ins.  Co.  417,  469,  505 
Norwich  Fire  Ins.  Co.  r.  Boomer  456 
Norwich  U.  F.  Ins.  Co.  r.  Stand- 


453 
11 
391  B 
11 
338 
287 
401  C 
470, 
504 
Nussbaum  v.  Northern  Ins.  Co.  82, 270 
Nute  V.  Hamilton  Mut.  Ins.  Co.  490 
112,  398 


ard  Oil  Co. 
Norwood,  Ex  parte 

V.  Guerdon 

V.  Resolute  Fire  Ins.  Co. 
Notnian  r.  Anchor  Ass.  Co. 
Noyes  r.  Hartford  Fire  Ins.  Co 

V.  N.  W.  Nat.  Ins.  Co. 

V.  Wash.  Co.  Mut.  Ins.  Co. 


Nye  r.  Grand  Lodge 


o. 


264 


449 

99 
101, 


Oakes  r.  Manuf.  Ins.  Co. 
Oakland  Home  Ins.  Co.  v.  Bank 

of  Commerce 
Oakman  v.  Dorchester  Mut.  Fire 

Ins.  Co. 
Obermeyer  v.  Globe  Mut.  Ins.  Co, 

194,  364,  365,  365  B 
O'Brien  v.  Com.  Fire  Ins.  Co.  465 

V.  Home  Ben.  Soc.     144  A,  563  A 
V.  Home  Ins.  Co.  269 

V.  New  Zealand  Ins.  Co.  126 

i;.  Ohio  Ins.  Co.  29  A,  469 


94  A 

55  A 

399  0 

291 

399  0 

270 


Mar. 
175, 


258 


V.  Pha!ni.\  Ins.  Co. 

V.  Prescott  Ins.  Co. 

V.  Union  Mut.  Ins.  Co. 
Ocean  Ins.  Co.  i'.  Carrington 

V.  Fields 

V.  Polleys 
Och  V.  Homestead,  &c.  Ins  Co. 
OTonnell  /•.  Kni^dits  of  Damon 
O'Conner  u.  Com.  Un.  Ins.  Co. 

V.  Hartford  Ins.  Co. 

?•.  Towns 
Odd  Fellows  Mut.  Life  Ins.  Co. 

r.  Uohkoop  299,  419  A 

•  Mlin  r.  Ins.  Co.  of  Penn.  350 

O'Donnell  r.  Confed.  Life  Ins.  Co.     65 

)gden  r.  East  River  Ins.  Co.    366,  435 

V.  Montreal  Ins.  Co.  82,  424 

Ixviii 


[The  references  are  to  the  sections.] 

Section 
O'Hara  v.  United  Brethren  Mut. 

Aid  Society  ^08 

Ohde  V.  North  Western,  &c.  Ins. 

Q^^  344  a,  345  a 

Ohio  Farmers'  Ins.  Co.  v.  Bevis    287  B 
Ohio   Mut.  Ins.  Co.  v.   Marietta 

Woollen  Co.  548,  557 

O'Keefe   v.    Liverpool,  &c.    Ins. 

Co  30,  421  a,  492 

O'Key  V.  State  Ins.  Co.  511 

O'Laughliu  v.  Union  Cent.  Life 

Ins.  Co.  478 

Oldman  v.  Bewicke  ^^ 

O'Leary  v.  German-American  Ins. 

•^  Co.  126,  369,  469  D 

V.  Merchants'   &   B.   M.  Ins. 

Co.  368,  369 

Olivt-  V.  Com.  Mut.  Mar.  Ins.  Co.       23, 

566 

V.  Greene 
V.  Mut.  L.  Ins.  Co. 
Olmstead  r.  Benefit  Soc. 
V.  Iowa  Mut.  Ins.  Co. 
V.  Keyes 
Oliiey  V.  German  Ins.  Co. 
Olson  V.  St.  Paul  Fire   & 

Ins.  Co. 

Omaha  F.  Ins.  Co.  v.  Crighton     144  D 

V.  Dierks  270,  460 

V.  Dufek  257 

V.  Hildebrand  469  C 

Omaha  Nat.  Bank  v.  Mutual  Ben. 

Life  Ins.  Co.  344  a 

O'Malia  v.  Home  Ins.  Co.  578 

Omberg   v.    United    States   Mut. 

Ace.  Ass'n  517  A 

O'Neil  V.  Buffalo  Fire  Ins.  Co.  170,  191, 

241,  242,  247,  468 

V.  Ottawa  Agr.  Ins.  Co.      186,  271 

Order  of  the  Iron  Hall  v.  Stein         552 

Order  of  Mut.  Comp.  v.  Griest      399  F 

O'Reilly  v.  Corp.  Lond.  Ass.  70  B 

V.  Guardian,  &c.  Ins.  Co.     460,  465 

V.  Kerns 

V.  Mut.  Life  Ins.  Co. 
Orient  Ins.  Co.  v.  Adams 

V.  Daggs 
Orient  Mut.  Ins.  Co.  v.  Wright      43  F 
Oriental   Bank   v.  Fremont   Ins. 

Co.  428 

Oriental  Ins.  Ass.  v.  Glancey        563  A 
Oriental  Ins.  Co.  w.  Adams  417  A 

Ormond  v.  Ins.  Co.  360  F 

Orr  V.  Hanover  F.  Ins.  Co.  269,  287  B, 

379 

Orrell  v.  Hampden  Fire  Ins.  Co.      270, 

272,  276  B 

Ortie  V.  N.  W.  Ins.  Co.  305 

Osgood  V.  Chicago,  &c.  R.  R.  Co.   578 

V.  De  Groot  595 


462 
247 

360  B 
52 

566  C 
246 
349 
186 
4(i6 
468 
400 


493 

568 

417  A 

30 


TABLE   OF   CASES. 


[The  references  are  to  the  sections.] 


Section 
O'Sliaughnessy  v    Working  Wo- 
men's Co-op.  Ass'n  159 
Oshkosh  Gas  Light  Co    v.   Ger- 

niania  Fire  Ins.  Co.     138,  422  B,  502 
Oshkosh   Packing  Co.  v.  Mercan- 
tile Ins.  Co.  158 
Osser  V.  Provincial  Ins.  Co.                368 
Osterloh  v.  New  Denmark  M.  H. 

Fire  Ins.  Co.  502 

Ottawa  Agr.  Ins.  Co.  v.  Canada 

Guarantee  Ins.  Co.  543  a 

Ottawa  Ins.  Co.  v.  Lon.  &  Liv.  & 

Globe  Ins.  Co.  219 

Otterbein  u.  la.  Ins.  Co.  69 

Ouachita,  The  3,50 

Overbeck  v.  Overbeck  287  B 

Overhy  v.  Fayetteville  Baud  Life 

Ass.  349  A 

Overhiser  r.  Overhiser  399  I) 

Overton  v.  St.  Louis,  &c.  Ins.  Co.     327 

Owen  V.  Farmers',  &c.  Ins.  Co.  468 

V.  Howard  Ins.  Co.  479 

Owens  V.  Bait.  &  O.  K.  Co.  457  B 

V.  Holland,  &c.  Ins.  Co.  498 

V.  Owens  407 

Owings  V.  Hull  122  A 


P. 


Pacaud  v.  Monarch  Ins.  Co.  365 

Pacific   Co.    S.    Co.  V.    Bancroft- 
Whitney  Co.  457  B 
Pacific;  Ins.  Co.  v.  Catlett  447  B 
Pacific  Mut.  L.  Ins.  Co.  v.  Frank      566 
V.  Guse  557 
V.  Snowden                           158,  306 
Packard  v.  Agawam  Mut.  F.  Ins. 

Co.  291 

V.  Dorchester  Mut.  Fire  Ins. 

Co.  1.38  A,  221 

Padelford  v.  Prov.  Mut.  Fire  Ins. 

Co.  227 

Page  V.  Bornstine  398 

Paine  r.  Atrricultural  Ins.  Co.  248 

V.  Meller  450 

V.  Pacific  M.  L.  Ins.  Co.     126,  159 

Palatine  Ins.  Co.  r.  Ewing  177,  371 

Palm  V.  Medina  Ins.  Co.    18,  48,  57,  58 

Palmer  ".  Com.  Ass.  523  A 

V.  Cont.  Lis.  Co.  345  H 

V.  Hartford  Ins.  Co.  566 

V.  Merrill  389,  395,  399 

V.  Northern  Mut.  Relief  Ass'n 

550  a,  557 
V.  Pratt  76  A 

V.  St.  Paul  Fire  &  Mar.  Ins. 

Co.  151,  464,  505 

V.  Warren  Ins.  Co.  175 

Palmer,  &c.  v.  Factors',  &c.  Ins.  Co.  465 


Section 
Palmer  Sav.  Bank  v.  Ins.  Co.  of 

North  America  263  E,  449 

Parish  V.  Wheeler  23  D 

Park  V.  Phoenix  Ins.  Co.  365,  477 

Parker  v.  Amazon  Ins.  Co.    144  B,  477 

V.  Arctic  Ins.  Co.  221 

V.  Bridgeport  Ins.  Co.  250 

V.  China  Mut.  Ins.  Co.  177 

V.  Citizens'  Ins.  Co.  151 

V.  Eagle  Ins.  Co.  433 

V.  Otsego    County    Farmers' 

Co-op.  F.  Ins.  Co.  200 

V.  Rochester  German  Ins.  Co.  126, 

177 
Parker  &  Young  Manuf.   Co.   v. 

Exchange  F.  Ins.  Co.  126 

Parkes  v.  Bott  391 

Parks  V.  Conn.  Ins.  Co.  108,  469  B 

V.  Gen.  Interest  Ass.  Co.     421,  424 

Parmelee  z'.  Hoffman  Ins.  Co.  247 

Parrish  v.  Va.  F.  &  M.Ins.  Co.  159,252 

Parsons  v.  Bignold  566 

V.  Charter  Oak  Life  Ins.  Co.        63 

V.  Citizens'  Ins.  Co.      207,  364,  373 

V.  KnoxviUe    F.   Ins.    Co.         126, 

263  A, 294  E 

V.  Queen's  Ins.  Co.  82,  180  a 

263  D,  371 

V.  Standard  Fire  Ins.  Co.  365,  372, 

383,  384 

V.  Victoria  Mut.  Fire  Ins.  Co.    372 

Partridge  v.  Phoenix  Ins.  Co.  576 

Patch  V.   Phoenix  Mut.  Life  Ins. 

Co.  158,  341,  345  a 

Patchin  v.  Astor  Mut.  Ins.  Co.  580 

Patrick  v.  Fames  422  A 

V.  Farmers'  Ins.  Co.     463,  464,478 

Patten  v.  Merchants'  &  Farmers' 

Mut.  Fire  Ins.  Co.     143,  290, 
294  E 
V.  United   Life  &  Ace.   Ins. 

Ass'n  303 

Patterson  v.  Ben   Franklin    Ins. 

Co.  50,  566 

V.  Natural    Premium    M.   L. 

Ins.  Co.  187,  327 

V.  Powell  75  A 

V.  Royal  Ins.  Co.  58,  64,  67 

V.  Triumph  Ins.  Co.  469  B 

Patton    V.    Employers'    Liability 

Ass.  Corp.  465 

Paul  V.  Travellers'  Ins.  Co.  523  A 

V.  Virginia  578  a 

Paul  Fire  &  Mar.  Ins.  Co.  v.  Mc- 
Gregor 488 
Pavey  v.  Am.  Ins.  Co.  284 
Pawson  i\  Barnevelt  158 
V.  Watson                              156,  158 
Payne,  Ex  parte                                   494 
V.  Cave  46 

Ixix 


TABLE   OF  CASES. 


[The  references  are  to  the  sections.] 


Section 
rayson  v.  Withers  577,  594 

Tayson  Ass.  v.  Stoever  594 

Peabody  v.  Wash.  Co.  Mut.  Ins. 

Co.  448 

Peacock  v.  N.  Y.  Life  Ins.  Co.       70  a, 

295,  46G 

Pearman  v.  Gould      276  C,  285,  457  C 

Pearson  v.  Com.  Un.  Ass.  Co.  400 

V.  Lord  575 

Peaseiey  v.  Safety  Deposit  Co.        296 

Peciiner  v.  Plicenix  Ins.  Co.      14.3,  365, 

371,  372 

Peck  *;.  Equit.  Ace.  Ass.    517  A,  563  A 

V.  Girani  F.  &  M.  Ins.  Co.  269 

u.  New  London  Co.  Mut.  Fire 

Ins.   Co.     i:n,  139,  143,  152, 

285 

Peckham  i'.  Grindlay  566  C 

Peddie  c.  Quebec  Fire  Ins.  Co.         423 

Peepke  r.  Resolute  Fire  Ins.  Co.       379 

Peet  r.  Dakota  F.  &  M.  Ins.  Co.      270, 

283,  401  B,  405 

Pelican  Ins.  Co.,  In  re  287  B 

V.  Schwartz  477 

V.  Smith  287  B 

V.  VVilkerson  263  A 

Pelkington  v.  Nat.  Ins.  Co.  370 

Pell  i:  Ball  465 

Pelly  lu  Royal  Exch.  Ass.  Co.         175, 

401  C 
V  Willson  399  C 

Pelton  V.  Westchester  Fire   Ins. 

Co.  87  A 

Pelzer  v.  St.  Paul  Fire  &  Mar.  Ins. 

Co.  95  A,  215  A 

Pelzer  Manuf.   Co.  v.  Sun  Fire 

Office  287  B,  453 

I'ence  v.  Makepeace  391,  395 

Pendar  r.  Am.  Mut.  Ins.  Co.  369 

Pendleton  ?■.  Elliott  456 

V.  Knickerbocker,  &c.  Ins.  Co.  347, 
469 
Penfold  ('.  Universal  Ins.  Co.     321,. 322 
Penley  r.  lieacon  Ass.  Co.         487,  488 
Pennebaker  r.  Tomlinson  274,  o86 

l^ennell  c  Lamar  Fire  Ins.  Co.         487 
Penn.  Fire  Ins.  Co.  v.  Dougherty    285, 
465,  469,  502,  589 
V.  Kittle  497 

Penn  In.s.  Co.  v.  Bowman  .385  A 

r.  Drackett  421  o 

r.  Gitttsman  291 

r.  Penn.  Mut.  Fire  Ins.  Co.   291  A 
V-  Telfair  n 

Penn.    Mut.    L.  Ins.   Co.  v.  Me- 
chanics' Sav.  B.  &  T.  Co.      156,  187 
r.  rni(m  Trust  Co.  67 

Penn.  Mut.  Rel.  Ass.  v.  Folmer       390 
Penn  Plate  Glass  Co.   v.  Spring 
Garden  Ins.  Co.  401 

Ixx 


Section 
Penn.  R.  R.  Co.  v.  Empire  Mut. 

Life  Ins.  Co.  358 

V.  Globe  Mut.  Life  Ins.  Co.  138  B, 

358,  399  P 

V.  Hope  417  A 

V.  Kerr  417  A,  459 

Penn.   Training    School   v.   Ind. 

Ins.  Co.  562 

Pennypacker  v.  Capital  Ins.  Co.      462, 

578  a 
Penson  v.  Lee  567 

Pentz  V.  Muia  Ins.  Co.  403 

People  V.  American  Steam  Boiler 

Ins.  Co.  2 

V.  Bartlett  350 

V.  Beigle  379 

V.  Golden  Rule,  &c.  75  B 

V.   Knickerbocker  Life  Ins. 

Co.  344  I,  594  a 

V.  Lewis  325 

V.  Liverpool,  &c.  Ins.  Co.  207 

V.  McCall  594  a 

V.  Rose  2 

I'.  Security,  &c.  Ass.  Co.        594  a 
V.  Universal  Life  Ins.  Co.  594 

V.  Van  Cleave  578  a 

People's  Ace.  Ass.  r.  Smith       462,  579 
People's  Eq.  Mut.  Fire  Ins.  Co. 

Petitioners  695 

V.  Babbitt  559 

People's  Eq.  Mut.  Ins.  Co.  v.  Ar- 
thur 559,  560 
People's  Fire  Ins.  Co.  v.  Pulver       465, 

469  B 
People's  Ice  Co.  v.  Employers'  L. 

Ass.  Co.  2 

People's  Ins.  Co.  v.  Hartford  Ins. 

Co.  11 

V.  Kuln  238,  242 

I'.  Paddon  23  A,  43  A,  125 

V.  Spencer  132,  150,  153,  371 

V.  Straehle  116,  454,  456 

People's     Mut.     Ass.     Fund    v. 

Boesse  "  12 

People's  Mut.  Benefit  Society  v. 

McKay  '  590 

r.  Templeton  103  a,  478 

People's  Mutual  Fire  Ins.  Co.  v. 

Allen  559 

People's  Mutual  Ins.  Co.  v.  West- 

cott  557 

Peoria   Fire   &  Mar.  Ins.  Co.  v. 

Botto  67,  574 

Peoria  Mar.  &  Fire  Ins.   Co.   v. 

Annapow  101,  278 

V.  Frost  454 

V.  Hall  130,  131,  143,  484 

V.  Hervey  70  a 

V.  Lewis  13,  171,  178,  420,  462 

V.  Perkins  261,  497 


TABLE   OF  CASES. 


[The  references  are  to  the  sections.] 


Section 

Peoria  Mar.  &  Fire  Ins.   Co.  v. 

Walser  507 

V.  vVhitehill  466,  469,  478 

V.  Wilson  423,  427 

Peoria  Sug.  lief.  Co.  v.  People's 

Fire  Ins.  Co.  215  A,  221 

Peppit  V.  N.  Brit.  Ins.  Co.  134 

V.  N.  Brit,  and  Mer.  Ins.  Co.  360  A, 

465 
Percival  v.  Maine  Mut.  Ins.  Co.  250 
Ferine  v.  Grand  Lodge  465 

Perkins  v.  Eq.  Ins.  Co.  580 

V.  Washington  Ins.  Co.  57, 135,  565 
Perley  v.  Eastern  R.  R.  Co.  94,  459 
Perrin  v.  Protection  Ins.  Co.  408 

V.  Prudential  Ins.  Co.  806 

Perrius  r.  Mar.  &  Gen.  Trav.  Ins. 

Co.  212,  306 

Perrott  v.  Shearer  4o5 

Perry  v.  Dwelling-House  Ins.  Co.      66, 

126,  138,  276 

V.  Faneuil  Hall  Ins.  Co.  138 

V.  Lorillard  Ins.  Co.  264 

V.  Mechanics'  Mut.  Ins.  Co.    87  A, 

278,  407  A,  469  D 

V.  Merchants'  Ins.  Co.  386 

V.  Newcastle  Dist.  Mut.  Fire 

Ins.  Co.  15,  566,  567 

V.  Phoenix  Ass.  Co.  589 

V.  Prov.  Ins.  Co.  401,  441,  535 

Perry  County  Ins.  Co.  v.  Stewart    143, 

229,  256,  267,  420 

Pervear  v.  Commonwealth  25 

Peters  v.  U.  S.  Ind'l  Iiis.  Co.         144  A 

V.  Warren  Ins.  Co.  417 

Petersburg  Savings  &  Ins.  Co.  v. 

Maniiattan  Fire  Ins.  Co.  67  D 

Peterson  v.  Miss.  Valley  Ins.  Co.      219 
Petit  V.  German  Ins.  Co.  239,  460 

Petitpain  v.  Mut.  Reserve  Fund 

L.  Ass'u  298 

Petti  grew  v.  Grand  River  Farm- 
ers' Ass.  87,  88 
PettingiU  '•.  Hinks  471 
Petty  V.  Mutual  F.  Ins.  Co.  405 
Pfister  v.  Gerwig  267,  276 
Phadenhauer   v.    Germania    Ins. 

Co.  317,  320 

Phelan  v.  N.   W.   Mut.  Life  In.-*. 

Co.  3.56  A 

V.  Phelan  .399  L,  399  N 

Phelps  V.  Gerhard  Fire  Ins.   Co.     70  a 

80,  190,  273,  381 

Phenix,  &c.  (See  Phoenix). 

Philadelphia  Fire  &  Life  Ins.  Co. 

V.  Mills  249,  274 

Phila.  Fire  Ass'n  v.  Brown  4.30 

V.  Flournoy  287  B 

Philadelpliia  Life  Ins.  Co.  v.  Am. 

Life  Ins.  Co.  12  D,  400 


Section 

Philadelphia    Life    Ins.    Co.    v. 
Wash.  Ins.  Co.  11 

Phila.  Tool  Co.  v.  British  Amer- 
ican Ass.  Co.  273  A 

Philbrook  v.  N.  E.  Mut.  Ins.  Co.      365, 
365  B,  371,  553 

Philips  V.  Knox  County  Mut.  Ins. 

Co.  90,  287 

V.  Merrimack  Mut.  Fire  Ins. 

Co.  379,  383,  425,  446 

Phillips  V.  Carpenter  399  D 

V.  Eastwood  115 

V.  Grand  River  Mut.  Fire  Ins. 

Co.  294  F 

V.  Louisiana  Ins.  Co.  320 

V.  Perry  County  Ins.  Co.  434 

V.  Prot.  Ins.  Co.     462,  466,  470, 491 
V.  Union  Cent.  L.  (^o.  478 

Phinney  v.  Mutual  L.  Ins.  Co.  158 

Phoenix  Ass.  Co.  v.  McAutiior    3,  55  A 
V.  Wachter  379 

Phoenix  Ins.  Co.  v.  Allen  144  A 

V.  Angel  263  A,  287  B 

V.  Arnoldy  589 

V.  A  sherry  269 

V.  Badger  493  A 

V.  Barnd  175 

V.  Batchelder  360 

V.  Benton  159,  590 

V.  Boulden  365 

V.  Bowdre  269 

V.  Boyer  247 

V.  Charleston  Bridge  Co.  406 

I'.  Clay  245 

V.  Cochran  408 

I'.  Coombes  240,  269 

V.  Copeland  126,  294  E,  365 

V.  Covey  369 

V.  Dungan  360 

V.  Erie,  &c.  Trans.  Co.    457,  457  A, 
457  B 
V.  Favorite  420 

V.  First  Nat.  Bank  449,  456 

V.  Flemming    177,  233,  239,  239  A, 

497 
V.  Frissell  67  L 

V.  Gurnee  566 

V.  Hale  44 

V.  Hamilton  99,  .366 

V.  Hancock  95  A 

V.  Hart  294  E 

V.  Hoffheimer  566 

V.  Holcombe  279,  368,  420 

t'.  Ireland  14,  21 

V.  .Johnston  369 

V.  Lamar  365  C 

V.  Lansing  502 

V.  La  Pointe  294  E 

V.  Lawrence        138,  189,  245,  264, 
268,  270,  278,  591 

Ixxi 


TABLE  OF   CASES. 
[The  references  are  to  the  sections.] 


Pbcpiiix  Ins.  Co.  i 
c.  .Mtlveriiiin 
I'.  Mention 
V.  Maniii 


i\  Michigan,  &c 

I'.  .Miinier 

V.  Mitchell 

v.  Moog 

V.  Muiiilay 

V.  Munger 

V.  Munger  Manuf.  Co. 


Section 

Lebclier      478,  488 

■60,  287  B,  513 

30,  31 

247,  420 

R.  R.  Co. 


366 

469  C 

87  A 

5'.il 

373  A,  591 

151 

67,  287  B, 

358 

I'.  Parsons  456 

V.  Perkey  589,  590 

V.  Pickel  277,  291  A,  292  A 

V.  Had  Bila  Hora  Lodge     126, 460, 
488 
V.  Rollins  345  E 

V.  Ryland  23  D 

V.  Slaughter  239,  243 

V.  Spiers        23  A,  23  C,  24  A,  125, 
126,  175,  372  B,  409 
V.  Stevenson    469,  497,  504  A,  507 
V.  Sullivan  408 

V.  Taylor  239,  242 

V.  Tucker  143 

V.  Union  Mut.  Life  Ins.  Co.     276  C 
V.  Walters 


V.  Ward 

V.  Wartteniberg 
V.  Wilson 
V.  Zucker 
Phoenix  Life  Ins.  Co. 


.  Raddin 


242 

70  a 

294  E 

287  B 

248 

159, 

162,  501 

344 

;90 


f.  Sheridan 
Phoenix  Mut.  Ins   Co.  v.  Dunham 
PhaMiix    Mut.    Life   Ins.    Co.   of 

Hartford  v.  Bailey  117,  573 

Pickard  v.  Sears  502 

Pickell  V.  Phenix  Ins.  Co.     144  A,  277, 
373  A,  461 
Pickett  V.  Ins.  Co.  54  A 

V.  Pacific  M.  L.  Ins.  Co.  324, 

523  A 
Piedmont,  &c.  Life  Ins.  Co.  v.  Char- 
ter Oak  Ins.  Co.    29  A,  345  B, 
391 
V.  Ewing  50,  51,  190,  590 

V.  Fitzi^erald  363  A,  502 

r.  Young  511 

Pierce  >:  Cohasset  Ins.  Co.  587  A 

V.  E.  L.  A.  Soc.  344  D 

V.  Nashua  Fire  Ins.  Co.      279,  379 
V.  The  People  124  A,  138  A 

V.  Travellers'  Ins.  Co.        322,  325 
i;.  Young  511 

Piggot  V.  Eastern  Counties  R.  R. 

Co.  454 

Pilbrow  V.  Atmospheric  R.  R.  Co.      28 
Pilcher  v.  N.  Y.  Life  Ins.  Co.    358,  390 

Ixxii 


Section 

Pimy.  Reid  218,221,230 

Pimm  V.  Lewis  207 

Pindar  v.  Cont.  Ins.  Co.  284 

V.  King's  County  Fire  Ins.  Co.    23b 

V.  Resolute  Fire  Ins.  Co.   192,  232, 

566 
Pine  V.  Vanuxem  188  D 

Pingree  v.  ^'atiollal  Ins.  Co.  399  E 

I'iiigrey  v.  Nat.  Life  Ins.  Co.  399  L 

Pinkham  v.  Morang  287 

Pinneo  v.  Goodspeed  459  B 

Pino  v.  Merchants'  Mut.  Ins.  Co.       62 
Pioneer    Manuf.    Co.   v.   Phoenix 

Ass.  Co.  421  a,  497 

Pioneer  Sav.  &  L.  Co.  v.  Provi- 
dence-Washington Ins. 
Co.  276  C 

V.  St.  Paul  F.  &  M.  Ins.  Co.  276  C 
Piper  .".  Mercantile  M.  Ace.  Ass'n  514 
Pipon  (7.  Coxe  411  A 

Pitney  v.  Glens  Falls  Ins.  Co.  126,  143, 
865,  365  a,  366,  372,  446 
Pitt  V.  Berkshire  Life  Ins.  Co.  341,  345, 
359,  584 
Pittsburg  Boat- Yard  Co.  v.  Ins. 

Co.  360  B 

Pittsburg  Ins.  Co.  v.  Frazee  233,  287  C 
Plahto  V.    Merchants'   Mar.    Ins. 

Co.  420  B,  511 

Planters'  Ins.  Co.  v.  Comfort   460,  465, 

559 
c.  Diggs 
V.  Myers 
V.  Sorreli 
r.  Walker  Lodge 
Planters'    Mut.    Ins.    Ass'n     v. 
Southern  Sav.  Fund  &Loan  Co. 

447  A 
Planters'  Mut.  Ins.  Co.  v.  Deford     143, 

468 
V.  Engle  80,  401  a,  420 

V.  Lloyd  287  B,  497 

V.  Lyons  370,  372  B 

V.  Rowland     29  A,  223,  224,  276  A 
Planters  &  MerchantsMns.  Co.  y. 

Thurston  95  A 

Plath  V.  Minnesota,  &c.  Ins.  Co.      189, 

277,  294  o,. 368 

Piatt  V.  Mtna  Ins.  Co.  430 

V.  Continental  Ins.  Co.  594 

V.  Richmond,  &c.  R.  Co.         457  B 

Pleasants  i-.  Maryland  Ins.  Co.  30 

Plessinger  v.  Depuy  25 

Plinskv  V.  Germania  Fire  &  Mar. 

Ins.  Co.  177,222,233 

Plumb  V.  Cattaraugus  Mut.   Ins. 

Co.       132,  137,  142,  143,  144  G,  263, 

498,  499 

Plyer  v.  German-Am.  Ins.  Co.  252 

Plympton  v.  Dunn  566  C 


579 
140,  154 
143,  247 
67.  67  D 


TABLE    OF   CASES. 


[The  references  are  to  the  sections.] 


248 
70  a 


491 

478 


Section 
PIvmpton  V.  Farmers'  Mut.  Fire 

ins.  Co.  456 

Poggensee  v.  Mutual  Fire  Light- 
ning &  Tornado  Ins.  Co.  402 
Polglass  V.  Oliver  345 
Pollard  V.  Phoenix  Ins.  Co.               35  A 
V.  Somerset   Mut.   Fire   Ins. 

Co.  269,  379 

Pollock  V.  U.  S.  Mut.  Act'.  Ass.        307 
Pulsalski  y.  IVIut.  Ins.  Co.  579  B 

Pomeroy  v.  Manhattan  Life  Ins. 

Co.  391,  399 

Pontifex  v.  Bignold  570 

Pool  V.  Hudson  Ins.  Co.  273  A 

V.  Milwaukee  Mechanics' Ins. 

Co.  239  A,  369,  407 

Poole  V.  Adam  450,  4-36 

Poor  V.  Hudson  Ins.  Co.  67,  69  B 

('.  Humboldt 
Port  V.  ^Etna  Ins.  Co. 
Portage  County  Mut.  Ins.  Co.  v. 
Stukey 
V.  West 

Porter  v.  ^tna  Ins.  Co.  75  A,  117,  288 

V.  Porter  459  D 

V.  U.  S.  L.  Ins.  Co.  126,  344  a 

Portsmouth  Ins.  Co.  v.  Brinckley    238, 

280 

1-.  Reynolds      403,  445,  469,  504  A 

Poss     V.     Western    Ass.    Co.         253, 

253  A 
Post  V.  iEtna  Ins.  Co.   23,  126, 134,  151, 

468 
V.  Hampshire  Mut.  Fire  Ins. 

Co.  32,  425 

Potter  V.  Mar.  Ins.  Co.  365  a 

V.  Monmoutli,  &c.  Ins.  Co.  442 

V.  Ontario  &  Liv.  Mut.  Ins. 

Co.  175,502  a 

V.  Phenix  Ins.  Co.  14,  126 

V.  Sanders  48 

V.  Union  Central  L.  Ins.  Co.      465 

Potts  V.  Bell  350 

Pottsville  Mut.  Fire  Ins.  Co.  v. 

Fromm  144  F 

V.  Iloran  206,  225,  226 

Poughkeepsie   Savings   Bank   v. 

Manhattan  Fire  Ins.  Co.  144  E 

Pousset  V.  Insurance  Co.  of  North 

America  386 

V.  Minnequa  Springs  Ins.  Co.      56, 

124  A 

Povvell  i\  Dewey  109  a,  398 

Power  V.  City  F.  Ins.  Co.  2-52 

V.  Ocean  Ins.  Co.  101,  265 

Powers  V.  City  Fire  Ins.  Co. 

V.  Guardian  Ins.  Co. 
Powers  Dry  Goods  Co.  v.  Impe- 
rial F.  Ins.  Co. 
Powles  V.  Innes 


188 
279 


492 
386 


Section 
Pratt  V.  Atlantic  &  St.  Lawrence 

R.  R.  Co.  94 

V.  ]3welling-House  Mut.  Fire 

Ins.  Co.  125,  137 

V.  N.  Y.  Central  Ins.  Co.  378 

V.  Travellers'  Ins.  Co.  530 

Preferred   Ace.  Ins.  Co.  v.  Bar- 
ker 515  a 
Preferred  Mut.  Ace.  Ass.  v.  Bei- 

delman  518  B 

Prentice  v.  Achorn  308 

V.  Knickerbocker  Ins.  Co.        469a 
Presbyterian  Mut.  Ass.  Fund  v. 

Allen  399  F 

Pretzfelder  v.  Merchants'  Ins.  Co. 

469  0,471,494 

Preuster  v.  Supreme  Council    305,  557 

Price  V.  Brady  459  F 

V.  Knights  of  Honor  398 

I'.  Phoenix  Mut.  Life  Ins.  Co.    165, 

183,  185,  187,  205,  304 

Prieger  v.  Exchange  Ins.  Co.    251,  253 

Priest  et  al.  v.  Citizens'  Mut.  Fire 

Ins.  Co.  147,  504 

Prince  of  Wales  Ins.  Co.  v.  Palmer   573 
Prince  of  Wales  Life  &  Ed.  Ass. 

Co.  V.  Harding  17 

Pringle  v.  Des  Moines  Ins.  Co.     287  B, 

469  C 
Pritchard  v.  Mer.  &  Tradesmen's 

Mut.  Life  Ins.  Co.  353 

Pritchet  v.  Insurance  Co.  of  North 

America  74,  75  A 

Prize  Cases  38,  350 

Propeller  Monticello  453 

Protection  Ins.  Co.  v.  Hall   80,  93,  145. 

373 
V.  Harmer  143,  170,  184,  242,  470 
V.  Pherson  466 

V.  Wilson  448 

Protection  Life  Ins.  Co.,  In  re         550a 
V.  Palmer  .562 

Protective  Union  v.  Gardner         133  A 
V.  Whitt  469,  563  A 

Protector,  The  38 

Providence  County  Bk.  v.  Benson  452  A 
Prov.  Fire  &  Mar.  Ins.  Co.  i-.  Mur- 
phy 552 
Prov.  Ins.  Co.  v.  Mina.  Ins.  Co.         481 
Prov.  L.  Ass.  Society  v.  Reutlin- 

ger  303 

Prov.  Life  Ins.  Co.  v.  Baum    398,  462. 
535,  536 
V.  Fennel!  532,  534 

Providence    Life    Ins.    &   Invest- 
ment Co.  V.  xMartin   409,  530,  532,  534 
Providence  W.  Ins.  Co.  v.  Adler      413 
I'.  Brummelkarap  566 

Prov.,  &c.  R.  R.  Co.  1).  Yonkers 
Ins.  Co.  401  a 

Ixxiii 


TABLE   OF   CASES. 
[The  references  are  to  the  sections.] 
Section 


rrovident  Life  In8. 
cago  r.  Femiell 


Co.  of  Chi- 

306,  359,  584 
Provident  S.  L.  Ass.  Society  v. 

Llewellvn  15«.  299 

rroviiR'ial  Ins.  Co.  v.  Lapsley  ^  o77 
Prows  r.  Oliio  Val.  Ins.  Co.  379,  386 
Prudential  Ass.  Co.  v.  iEtna  Life 

Ins.  Co.  182 

Prudential  Ins.  Co.  v.  Hunn  11'^ 

i\  Jenkins  103  A 

V.  Liersli  H'-^ 

Prudlioninie  v.  Salamander   Ins. 

Co.  401 B 

Pudritsky  v.  Knights  of  Honor    14-1  B, 

298 
Pugh  r.  London,  &c.  Ey.  Co.  515  a 
Puller  V.  Glover  27 

PuUinj;  i:  Travelers'  Ins.  Co.  340 

Pullis  r.  Robinson  390,  391 

Puj.ke  r.  Resolute  Fire  Ins.  Co.  379 
Purceli  V.  St.  Paul  F.  &  M.  Ins. 

Co.  460 

Purves  V.  Germania  Ins.  Co.  30 

Putnam  r.  Com.  Ins.  Co.  239 

r.  Commonwealth  Ins.  Co.     372  C 

r.  Home  Ins.  Co.       23,  44,  59,  126 

r.  Mercantile  Ins.  Co.  79 

Putnam   Tool   Co.   v.   Fitchburg 

Mut.  Fire  Ins.  Co.  137  A,  507 

Pym  V.  Great  Northern  R.  R.  Co.     455 


Q. 


Quarles  v.  Clavton  6,  452  A 

Quarrier  v.  Ins.  Co.  278,  287,  435 

V.  Peabody  Ins.  Co.  279 

Quebec  Fire  Ins.  Co.  v.  Molson        453 
V.  St.  Louis  453,  454 

Queen  Ins.  Co.  v.  Hudnut  Co.  406 

V.  Jefferson  Ice  Co.      422  B,  578  a 
V.  Kline  247,  285 

V.  May  287  B 

V.  Young  200 

Queen's  Ins.  Co.  v.  Harris  126 

Quin  V.  Nat.  Ass.  Co.         197,  250,  580 

Quinlan  v.  Providence  Washing- 
ton Ins.  Co.  126,  144  D 

Quinn  r.  Capital  Ins.  Co. 

Quinsig!imond    Lake   S.    Co.   v. 
Plianix  Ins.  Co. 

Quonij  Tue  Sing  v.  Anglo-Nevada 
Ass.  Corp. 


369 
479 


247 


67  G 


R. 

Raber  v.  Jones 
Rachai  v.  Smith 
Racine  r.  Eq.  Ins.  Co. 

Ixxiv 


564 

453 
466 


Section 
Rafael  v.  Nashville  Mar.  &  Fire 

Ins.  Co.  420 

Rafferty  v.  Nevjr  Brunswick  Fire 

Ins.  Co.  191,  231,  242,  245 

Rahr  v.  Manchester  F.  Ass.  Co.  ^126 
Railev  v.  Board  of  Assessors  578  a 

Railway  Conductors'  Mut.  Aid  & 

Ben.Ass'n  I'.  Looniis  488 

Railway  Pass.  Ass.  Co.  v.  Burwell  586 
Rainser  v.  Boston  M.  L.  Ass'n        298, 

299 
Rainsbarger  v.   Union  Mut.  Aid 

Ass.  563  A 

Rainsford  r.  Royal  Ins.  Co.  336 

Ralli  V.  White  2 

Ramsay  et  al.  v.  Mut.  Fire  Ins.  Co.     277 
Ramsay    Woollen    Cloth   Manuf. 
Co.  V.  Mut.  Fire  Ins.  Co.       865,  366, 

591 
Ramsey  i'.  Phoenix  Ins.  Co.      86,  87  A, 
273  A,  285,  287 
Ramspeck  v.  Pattillo  125 

Randall  v.  Phoenix  Ins.  Co.  494 

Rankin  r.  Amazon  Ins.  Co.  252 

V.  Amer.  Ins.  Co.  179  D,  289 

Rann  v.  Home  Ins.  Co.  170,  224 

Rannev  v.  Mut.  Ben.  Life  Ins.  Co.  302 
Ranspach  v.  Teutonia  F.  Ins.  Co.  247 
Rapid,  The  850 

Rasmusen  v.  New  York  L.  Ins. 

Co.  567 

Rathbone  v.  City  Fire  Ins.  Co.        70  a, 

190,  235,  502,  504 

Rau  V.  Westchester  F.  Ins.  Co.     239  A, 

420 
Raub  V.  Masonic  Mut.  Relief  Ass. 

399  0 
Rawlins  v.  Desborough  123,  213 

Rawlings  v.  Bell  188  D 

Rawls  V.  Am.  Mut.  Life  Ins.  Co.     108, 
109,  112, 117, 123, 192,  203,  207,  213, 
214,  581 
Rawson  i'.  Jones  390 

Rayner  v.  Preston  .  450, 456 

Real  Estate  Mut.  Fire  Ins.  Co.  v. 

Roessle  61,  63,560  A 

Real   Estate  &  Fire  Ins.   Co.  v. 

Cashaw  10, 386 

Reaper  City  Fire  Ins.  Co.  v.  Jones     143, 
^  239 

Reardon  v.  Faneuil  Hall  Ins.  Co. 

253  B 
Receivers  of  Globe  Ins.  Co.  595 

Reck  V.  Hatboro  Mut.  Live-Stock 

&  Protective  Ins.  Co.  401  a 

Roddick  V.  Saugeen  185,  292 

Redfield  v.  Holland  86 

Redford  v.  Mut.  Fire  Ins.  Co.  30 

Redman  v.  Mtna  Ins.  Co.  590 

V.  Hartford  Fire  Ins.  Co.     161,250 


TABLE   OF   CASES. 
[The  references  are  to  the  sections.] 


Section 
Redman  v.  Wilson  411  A 

Kedmoii  v.  Plicenix  Ins.  Co.  291 

Redmond  v.  Industrial  B.  Ass'n      298, 

465 
Redstrake  v.  Cumberland  Ins.  Co. 

133  E 
Red   Wing    Mills    v.  Mercantile 

Mnt.  Ins.  Co.  420  B 

Reed  r.  Equitable  F.  &  M.  Ins.  Co.     3B9 
V.  Independent  Ins.  Co.  592 

V.  Merchants'  Mut.  Ins.  Co.  400 
V.  Koval  Ex.  Ass.  Co.  107  b,  323 
V.  Union  Cent.  L.  Ins.  Co.  345  E 
i>.  Washington  Ins.  Co.  423  B, 

492,  494 
V.  Windsor  Co.  Mut.  Fire  Ins. 

Co.  378  a 

Rees  V.  Scottish,  &c.  Ass'n  590 

Reese  v.  Mut.  Ben.  Life  Ins.  Co.       350 
V.  Smyth  597 

Reeves  v.  White  494 

Regnier  i-.  La.  Sp.  Ins.  Co.  583 

Reichard  v.  Manhattan  Life  Ins. 

Co.  191,  299,  490,  569  A 

Reid  V.  Gore  Dist.  Mut.  Fire  Ins. 

Co.  220 

V.  Lan.  Fire  Ins.  Co.  249  C 

V.  M'Crum  452  C 

V.  Piedmont,  &c.  Ins.  Co.  304 

Reif  V.  Union  Mut.  Life  Ins.  Co.      107 

Reilly  v.  Chicago  Guaranty  Fund 

L.  Society  70  C,  298 

V.  Franklin  Ins.  Co.  422  B 

Reitenbacli  o\  Johnson  452  A 

Reithmuller  r.  Fire  Ass.  287  A 

Relfe  V.  Columbia  Life  Ins.  Co.  594  a 
Reliance  Lumber  Co.  v  Brown  594 
Relief  Fire  Ins.  Co.  v.  Shaw  23 

Remington   v.  Westchester   Fire 

Ins.  Co.  352  F 

Renier    v.    Dwelling-House    Ins. 

Co.  144  C 

Renninger  v.  Dwelling-House  Ins. 

Co.  291  A 

Rens  V.  Northwestern  Mut.  Relief 

Ass'n  322,  325 

Renshaw  v.  Fireman's  Ins.  Co.         413 
V.  Missouri   State  Mut.  F.  & 

M.  Ins  Co.       239  A,  242,  402 
Replogle  V.  American  Ins.  Co.  369 

Republic  Ins.  Co.,  In  re  11 

Reserve  Life  Ins.  Co.  v.  Kane  106 

Residence  Fire  Ins.  Co.  v.  Hanna- 

wold  249  B 

Revere  Fire  Ins.  Co.  v.  Chamber- 

lin  5V3 

Rex  V.  Harborne  46 

V.  Ins.  Companies       101,  116,  143, 

278,  293,  424 

Reynolds  v.  Accidental  Ins.  Co.       518 


Section 

Reynolds  v.  Com.  Ins.  Co.        236,  501 

V.  Continental  Ins.  Co.  129 

V.  London  &  L.  F.  Ins.  Co.     447  A 

V.  Mut.  Fire  Ins.  Co.  555 

V.  State  Mut.  Ins.  Co.         288,  291 

Rheims  v.  Standard  F.  Ins.  Co.         465 

Rhinehart  v.  Alleghany  Co.  Mut. 

Ins.  Co.  558 

Rhode  Island  Underwriters'  Ass'n 

V.  Monarch  269 

Rhodes,  In  re  465 

Rhodes  v.  Railway  Pass.  Ins.  Co.      23, 

523,  537,  565 

Riach  V.  Niagara,  &c.  Ins.  Co.  373 

Rice  V.  Homer  402 

v.  N.  E.  Mar.  Ins.  Co.  188  D 

V.  N.  E.  Mut.  Aid  Soc.  561  A 

V.  Prov.  Ins.  Co.  477 

V.  Smith  399  D,  459  B 

V.  Tower  269,  270,  274 

Richards  v.  Continental  Ins.  Co.      138, 

248 
V.  Prot.  Ins.  Co.  232 

V.  Travelers'  Ins.  Co.  517  A 

V.  Wash.    Fire   &   Mar.  Ins. 

Co.     133A,  133B,  207,  215C, 

591 

Richardson,  Succession  of  3991 

V.  Canada,  &v..,  Ins.  Co.  294 

V.  Home  Ins.  Co.  420  A,  456 

V.  Maine  Ins.  Co.         141,  277,  290 

V.  Marine  Ins.  Co.  71 

V.  Mutual  L.  Ins.  Co.  340 

V.  Suffolk  Ins.  Co.  492 

V.  White  379 

Richmond  v.  Niagara  Falls  Ins. 

Co.       294  6,  365  a,  370,  372  C, 
497 
V.  Phoenix  Ass.  Co.  379 

Richmondville  v.  Hamilton  Mut. 

Ins.  Co.  435 

Richmondville  Union  Seminary  v. 

Ham.  Ins.  Co.  200 

Ricker  v.  Charter  Oak  Ins.  Co.        390, 
391,  399 L 
Riddlesbarger    v.   Hartford    Ins. 

Co.  478,  483 

Ridge  V.  Ins.  Co.  249  C,  249  I 

Ridley  v.  Ennis  452  C 

Riegel  v.  American  L.  Ins.  Co.        GQa, 
70  C,  159,  566 
Rife  V.  Lebanon  Mut.  Ins.  Co.  221 

Uiggin  V.  Patapsco  Ins  Co.     172  A,  175 
Riggs  V.  Coni'l  Mut.  Ins.  Co.  90 

V.  Palmer  407 

Riley    v.    Commonwealth    Mut. 

Fire  Ins.  Co.  349  C 

V.  Hartford  Ins.  Co.  31,  322 

Rindge  v.  N.  E.  Mut.  Aid  Soc.    399  H, 

561  A 

Ixxv 


TABLE   OF   CASES. 
[The  references  are  to  the  sections.] 
Section 


Rin<lskoffBros.&  Co.  V.Lyman       2b7 

HiiRs  r.  GLTmiin  Ins.  Co.  379,  4b2 

King  c.  I'ha'uix  Ass.  Co.  1B4 

(•  Windsor  Co.  Mut.  Fire  Ins. 

Co.  144  E,  292  B,  602 

Kinn  r.  Astor  Fire  Ins.  Co.  594 

Hintoul  I'.  N.  Y.  Central,  &c.  R.  R. 

457  B 

Ripley  v.  /Etna  Fire  Ins.  Co.  156,  170, 

180,251,456,478,488 

V.  Astor  Ins.  Co.  251 

Riplev.  Adni'r,  v.  iMaritime  Pass. 

Ass.  Co.  520,  528 

Ripsiein  v.  St.  Louis  Ins.  Co.  470 

Rising  Sun  Ins.  Co.  v.  Slaughter     365, 

590 
Rison  V.  Wilkerson  391 

Rissler   u.   American    Cent.   Ins. 

Co.  263  A,  421  a 

Ritt  V.  Washington  M.  and  Fire 

Ins.  Co.  125 

Ritter  v.  Mutual  L.  Ins.  Co.  407 

i\  New   York   Mut.  L.   Ins. 

Co.  323,  324,  325 

r.  Smith  459  A,  450  D 

V.  Sun  Mutual  Ins.  Co.    218,  263  C 

Rivara  v.  Queen's  Ins.  Co.   126,  133  A, 

144  E 
Rivers,  Adm'r,  r.  Gregg  108 

Rix  r.  Mut.  Ins.  Co.  461,  557 

Roacli  i:  Ivy.  Mut.  Security  Fund 

Co.  183 

V.  N.  Y.  &  Erie  Ins.  Co.  478 

Robbins  v.  People's  Ins  Co.  434 

V.   Springfield  F.   &  M.  Ins. 

Co.  137A,  204E,  497 

Robert  v.  N.  Eng.  Mut.  Life  Ins. 

Co.  341,  342,  354,  3-56,  584 

Roberts  v.    Chenango    Co.   Mut. 


Ins.  Co. 

158 

V.  Continental  Ins.  Co. 

371 

1-.  Firemen's  Ins.  Co. 

72 

V.  Germania  Fire  Ins.  Co. 

70  B 

V.  Lane 

23  D 

V.  Pliocnix  L.  Ins.  Co. 

407 

V.  Roberts 

399  F 

r.  Security  Co. 

360 

Roberts,  Adni'r,  v.  Cocke 

469 

Robertson  v.  French          173. 

175,  177 

V.  Mc'tr.  Life  Ins.  Co.   360  C,  360  D 

V.  !\Ioney 

172  A 

r.  State  Ins.  Co. 

133  A 

Robinson  v.  JEtnn  Ins.  Co. 

247,  248 

r.  Duvall 

390 

V.  Fire  Ass. 

369 

V.  Georges  Ins.  Co. 

492 

V.  Ilurst 

83 

V.  Ins.  Co. 

345  H 

V.  Int.  Life  Ass.  Soc.  of  L 

on- 

don               39  A,  40, 

134,  345 

Ixxvi 

294  E 


567 


Section 
Robinson  v.  Mercer  Co.  Mut.  Fire 

Ins.  Co.        152,  178,  224,  228, 

230,  245,  410 

V.  Met'n  L.  Ins.  Co.  144  A 

V.  Mut.  Ben.  Ins.  Co.      391,  399  Q 

V.  N.  Y.  Ins.  Co.  80 

V.  Pennsylvania  F.  Ins.  Co.      247, 

469  C 

V.  St.  Louis,  &c.  Ins.  Co.  356,  360  C 

i;.  Tobin  27 

V.  U.  S.  Mut.  Ace.  Ass'n  112, 

517  A 

Robison   v.  Ohio   Farmers'  Ins. 

Co. 
Roby  V.  American   Central  Ins. 

Co. 
Rochester  Ins.  Co.  v.  Martin 
Rochester  Loan  &  B.  Co.  v.  Lib- 
erty h's.  Co.  72, 144  a,  247,  269,  469  C 
Rockford    Ins.    Co.    v.   Farmers' 

State  Bank  294  E 

V.  Nelson      186,  284,  505,  513,  589 

r.  Travelstead  604  A 

V.  Winfield  469  C 

Rockingham  Mut.  Fire  Ins.  Co.  v. 

Bosher  463, 454 

Rockwell  V.  Hartford  Fire  Ins.  Co.      22 

r.  Mut.  Life  Ins.  Co.  360,  362 

Rodi  V.  Rutgers  Ins.  Co.  690 

Roe  V.  Columbus  Ins.  Co.  415 

V.  Dwelling-House  Ins.  Co.       248, 

469  C 

Roebuck  v.  Hammerton  27,  76  A 

Roehner  v.  Knickerbocker   Life 

Ins.  Co.  342  A,  345  E 

Rogers  v.  Charter  Oak  Life  Ins. 

Co.  51 

Roger  Williams  Ins.  Co.  v.  Car- 

rington  24  A,  386 

Rohrbach  v.  Germania  Fire  Ins. 

Co.  83,  465 

Rohrschneider  v.  Knickerbocker, 

&c.  Ins.  Co.  356 

Rokes  V.  Amazon  Ins.  Co.  462 

Roller  V.  Moore's  Adm'rs  898 

Rollins  V.  Columbian   Miit.   Fire 

Ins.  Co.  269,  447 

Rombach  v.  Piedmont,   &c.   Life 

Ins.  Co.  75  B,  102  A 

Ronald  v.  Mut.  Reserve  Fund  Life 

Ass.  70  C,  604  A 

Roos  V.  Merchants'  Mut.  Ins.  Co.       96 
Hoot  V.  Cincinnati  Ins.  Co.  366 

Roper  V.  Lendon  465,  492,  494 

Rose  V.  Star  Ins.  Co.  295 

V.  Wortham  3991) 

Rosebud  M.  Co.  v.  Western  Ass. 

Co.  231 

Rosenbanm  v.  Council  Bluffs  Ins. 

Co.  666 


TABLE  OF  CASES. 


[The  references  are  to  the  sections.! 


Section 

Eosenbaum  v.  U.  S.  Credit  Sys- 
tem Co.  1 
Rosenberger  v.  Ins.  Co.             552,  559 
Rosenwald  /•.  Phoenix  Ins.  Co.           493 
Ross  V.  Bradshaw                        200,  295 
V.  Citizens'  Ins.  Co.                      288 
V.  Com.  Un.  Ass.  Co.                  477 
V.  Hawke^e  Ins.  Co.                     357 
V.  Star  Ins.  Co.                              123 
Rossiter  v.  JEtna  L.  Ins.  Co.              159 
V.  Trafalgar  Ass.  Assoc.             126 
Roth  V.  City  Ins.  Co.                   132,  143 
Rothscliild  V.  Am.  Cent.  Ins.  Co.      138 
Roumage  v.  Mechanics'  Fire  Ins. 

Co.  152,  461,  466,  469 

Rousseau  c.  La  Conflance  424 

Routii  r.  Thompson  78 

Routledge  v.  Burrell  29 

r.  Grant  47 

Rowe  V.  London,  &c.  Ins.  Co.    166,  239, 

247 

Rowland  v.  Springfield  43  H 

Rowley  r.  Empire  Fire  Ins.  Co.       129, 

143,  144,  152,  372,  499 

Rowsell  >'.  Equitable  Aid  Union  561  A 

Roy  V.  Globe  Ins.  Co.  594  a 

Royal  Can.  Ins.  Co.  v.  Smith  207 

Royal  Ins.  Co.  v.  Beatty  43  H 

V.  Byers  575 

V.  Clark  67 

V.  Lubelsky  249  I 

V.  McCrea,  Maury  &  Co.        364  A 

V.  Mclntyre  421  a 

V.  Roedel  435,  436  a 

V.  Roodhouse  452  F 

V.  Stinson  456,  457 

V.  Vanderbilt  Ins.  Co.  12 

V.  Wight  67  G 

Royal   Neighbors  of  America  i\ 

Boman  303 

Royal  Templars  v.  Curd  419  A 

Royster  v.  Roanoke  N.  &  B.  S.  B. 

Co.  13 

Ruggles  V.  Am.  Cent.  Ins.  Co.       43  C, 

126 
Rumsey  v.  Phoeni.x  Ins.  Co.  283 

Rundle  v.  Kennan  591  A 

Runkel  o.  Lloyd  Plate  Glass  Ins. 

Co.  515  a 

Runker  v.  Citizens'  Ins.  Co.       274,  574 

Runkle  v.  Citizens'  Ins.  Co.  67  L,  292  A 

V.  Hartford  Ins.  Co.         279,  401  A 

Ruppert  V.  Un.  Mut.  Ins.  Co.  392 

Ruse  V.  Mut.  Ben.  Life  Ins.  Co.  74,  75, 

115,  355,  400 

r.  Mut.  Fire  Ins.  Co.    189,  266,  277 

Russ  V.  Mut.  Ins.  Co.  267 

V.  Waldo  Mut.  Ins.  Co.  215  C.  379 

Russell  '•.  Berry  560  A 

V.  Cedar  Rapids  Ins.  Co.     270,  294 


Section 
Russell  V.  De  Grand  567 

v.  Fidelity  F.  Ins.  Co.  364 

V.  Manufacturers'  &  Builders' 

F.  Ins.  Co.  177,2.39 

V.  N.  E.  Mut.  Ins.  Co.         448,  457 
V.  Russell  399  G 

V.  State  Ins.  Co.  370 

V.  Union  Ins.  Co.  82 

Russell's  Policy  Trust,  In  re  396 

Russum  V.  St.  Louis,  &c.  Ins.  Co.     341, 

345  a 
Rustin  V.  Standard  L.  &  Ace.  Ins. 

Co.  515  a 

Ruth  V.  Katterman  398 

Kuthven  v.  American  F.  Ins.  Co.  469  D 

Ryall  V.  Mut.  Prot.  Life  Ass.  Soc.      65 

Ryan  i:  Adamson  452  B 

i:  X.  Y.  Cent.  R.  R.  Co.      4-54,  459 

V.  Rand  359 

V.  Rothweiler  399  Q 

r.  Springfield,  &c.  Ins.  Co.         184 

V.  World  "Mut.  Life  Ins.  Co.     143, 

566 

Ryder  r.  Commonwealth  Ins.  Co.     432 

V.  Missouri  St.  Mut.  Ins.  Co.      505 

V.  Phoenix  Ins.  Co.  425 


Sabin  v.  Senate  of  the  National 

Union  322 

Sadlers'  Co.  r.  Badcock    6,  74,  81,  100, 

378,  386 

Safford  v.  Wyckoff  16 

St.  John  v.  Am.  Mut.  Life  Ins.  Co.     7, 

107  b,  114, 116, 117,  398,  399  Q, 

447 

V.  Am.  Mut.  Mar.  &  Fire  Ins. 

Co.  415 

St.  Johns,  The  453 

St.    Lawrence    Mut.    Ins.   Co.   v. 

Paige  557 

St.  Louis  A.  &  T.  Ry.  Co.  v.  Fire 

Ass'n  of  Phila.  457  B 

St.  Louis  Ins.  Co.  v.  Kyle  462,  464,  468, 
477,  491 
St.  Louis  Mut.   Fire   Ins.  Co.  v. 

Broeckler  555 

St.  Louis  Mut.  Ins.  Co.  v.  Glasgow  248, 

408 
St.  Louis   Mut.   Life  Ins.  Co.   v. 

Graves  312,  316,  825 

f.  Grig.sby  341,345  a 

V.  Kennedy  56 

St.  Nicholas  Ins.  Co.  v.  Mercantile 

Ins.  Co.  179  D 

V.  Merchants',  &c.  Ins.  Co.         218 
St.  Onge  V.  Westchester  F.  Ins. 
Co.  285,  379 

Ixxvii 


TABLE   OF   CASES. 
[The  references  are  to  the  sections.] 


Section 

St.  Pnul,  &c.  Ins.  Co.  v.  Johnson      433 

...Kidd  ^^'^'%rt 

'■•  I'arsons  A^^ 

■■■  ^'"'^«'-  ^^5ot 

(•  Wells  "^^^ 

St   Taiil's  Ins.  Co.  v.  Steamboat      454 

St  I'aiil  Title  Ins.  Co.  i'.  Johnson    45o 

Saientiiie  v.  Mut.  Ben.  Life  Ins. 

Co. 
Salisbury  v.  Hekla  Fire  Ins.  Co         23 
Salmon  v.  Hicliardson  5o2,  5/U 

Salter  <•.  Bush  349 

Salvin  y.  James  25,  d5b,  d5/ 

Samo  I'.  Gore  Dist.  Mut.  Fire  Ins. 

Co.  277 

Sample  v.  London  &  Lancashire 

F.  Ins.  Co.  478,  479 

Sampson  v.  Grogan  448 

Sanborn  v.  Fireman's  Ins.  Co.       18, 23 

Sanders  v.  Cooper  144  F,  364  A,  372  C 

V.  Hillsborough  Ins.  Co.      425,490 

V.  Watertown  Fire  Ins.  Co.      365, 

365  B 

Sanford  v.  Orient  Ins.  Co.       23  C,  151 

Sands  v.  Hill  552,  558,  558,  594 

V.  N.  Y.  Life  Ins.  Co.        39,  39  A, 

40,  345,  350 

V.  Sanders  558 

I'.  St.  John  549 

V.  Standard  Ins.  Co.         180  a,  269 

r.  Sweet  559 

Sandys  v.  Hodgson  502 

Sanford  v.  Mechanics'  Mut.  Fire 

Ins.  Co.         227,  241,  408,  552 

;•.  Trust  Fire  Ins.  Co.  19,  54 

Sanger  v.  Rothschild  399  H 

r.  Upton  594 

Sans,  Receiver,  v.  Hill  555 

Santa  Clara  Female  Academy  v. 

Northwestern  National  Ins.  Co.  95  A, 

421  a 

Sargent  v.  Nat.  Fire  Ins.  Co.  23  B 

Sarsfiehl  v.  Metropolitan  Ins.  Co.     247 

Sater  v.  Henry  County  Farmers' 

Ins.  Co.  70  a 

Satterthwaite  ".  Mut.  Ben.  Ins.  Co.  207 

Sauvey  v.  Isolated  Ins.  Co.  285 

Savage  o.  Corn  Ex.,  &c.  Ins.  Co.   94  A, 

423  A. 469  B 

V.  Howard  Ins.  Co.  27-%  445 

V.  Long  Island  Ins.  Co.  272 

V.  Medbury  549,  557,  594 

r.  O'Neil  331 

r.  riioenix  Ins.  Co.  67  D 

Savannah  F.  &  M.  Ins.  Co.  v.  Pel- 

zer  Manuf.  Co.  453 

Saveland  v.  Fidelity  &  Casualty  Co.  523 
Savings  Institution  v.  Commercial 

Ins.  Co.  446 

Sawyer  i-.  Dodge  Co.  Mut.  Ins.  Co.  401  a 
Ixxviii 


Section 

Sawyer  f.  Equitable  Ace.  Ins.  Co.     126 

V  Hoag  596 

V.  U.  S.  Casualty  Co.  522 

Savles  I'.  North  Western  Ins.  Co.    156, 

157,  158,  171,  258 

Sayres  v.  Hartford  Fire  Ins.  Co.         81 

Scammell  v.  China  Mutual  Ins.  Co.   14 

Scammon  r.  Com.  Un.  Ins.  Co.    269  a, 

469 

V.  Germania  Ins.  Co.  462 

V.  Kimball  596 

Scanlon  v.  Sceales  304 

V.  Union  Fire  Ins.  Co.  276  B 

Scarth  v.  Security  Mut.  Life  Soc.    322 

Sceales  v.  Scanlan  156,  170 

Schaeffer  v.  Baltimore  Mar.  Ins. 

Co.  420  B 

V.  Farmers'  Ins.  Co.         240,  294  E 

Schaible  v.  Wash.  Life  Ins.  Co.        585 

Scheftt-r  r.  National  Ins.  Co.  320 

Sciieiderer  v.  Travelers'  Ins.  Co.     461, 

524  A 
Schenck  v.  Mercer  Co.  Mut.  Ins. 

Co.  152,  365,  368,  402,  580 

Scheu  V.  Grand  Lodge,  &c.   Ind. 

Foresters  561  A 

Schinip  V.  Cedar  Rapids  Ins.  Co.  345  E, 
345  H,  502 
Schimpf  V.  Lehigh,  &c.  Ins.  Co.        550 
Schlect  V.  World  Ins.  Co.  572 

Schmidt  r.  American  Mut.  Ace. 

Ass'n  566 

V.  Charter  Oak  Life  Ins.  Co.  327  A 

V.  Home  Life  Ins.  Co.  322 

V.  Mut.  Citv,  &c.  Ins.  Co.       373  B 

V.  N.  Y.  Un.  Mut.  Fire  Ins.  Co.  583 

V.  Peoria,  &c.  Ins.  Co.  192, 218, 231, 

255,  .341  a 

Schmurr  v.  State  Ins.  Co.  67, 401  B,  466 

Schneider  v.  Prov.  Life  Ins.  Co.      409, 

530 
V.  U.  S.  Life  Ins.  Co.  399  P 

Sclioener  v.  Hekla  Fire  Ins.  Co.       143 
Schoep  V.  Bankers'  Alliance  Ins. 

Co.     ^  125,  399  D 

Schofield  v.  Jones        -  400 

V.  Nav.  B.  Pat.  Tanning  Co.  452  B 
Scholefield  v.  Eichelberger  42  A 

Schoneman  v.  Ins.  Co.  502 

School  Dist.  V.  Danelly  350 

I'.  German  Ins.  Co.  241 

School  Dist.  in  Dresden  v.  iEtna 

Ins.  Co.  270  B 

Schouweiler  v.  Merchants'  Mut. 

Ins.  Ass'n  494 

Schroedel  v.  Humboldt  F.  Ins.  Co.  287  B 
Schroeder  i'.  Farmers'  Mut.  Fire 

Ins.  Co.  557 

V.  Keystone  Ins.  Co.  488 

V.  Mut.  Life  Ins.  Co.  419  A 


TABLE    OF   CASES. 


[The  references  are  to  the  sections.] 


Section 
Schroeder  v.  Springfield  F.  &  M. 

Ins.  Co.  345  E,  368 

V.  Stock  and  Mut.  Ins.  Co.         177 

V.  Trade  Ins.  Co.  175,  401 

Schultz  V.  Citizens'  Mut.  L.  Ins.  399  _D 

V.  Hawkeye  Ins.  Co.  358 

V.  Ins.  Co.  307 

V.  Merch.  Ins.  Co.  156,  249  B, 

423  A,  589 

V.  Mut.  Life  Ins.  Co.  296 

V.  Pacific  Ins.  Co.  583 

Schumaclier   v.   Manliattan   Life 

Ins.  Co.  344  a 

Sciiunck  V.  Gegenseitiger,  Witten 

und  Waisen  Fond  170 

Scliunilscii  a.  American  Ins.  Co.      277, 

290 
Schurtz  V.  Gennania  Life  Ins.  Co.  55 
Schuster  v.  Dutciiess  Co.  Ins.  Co.  189 
Schwabe  v.  Clift  308 

Sciiwartz  v.  Germania  Ins.  Co.     340, 

347 

Scliwartzbacli  v.  Prot.  Union       144  D, 

156,  162,  185,  429,  465,  501,  502,  579, 

589 
Schweiger  v.  Magee  75 

Scoles  V.  Universal  Life  Ins.  Co.     296, 

304 
Scott  V.  Avery  492,  493,  494,  495 

V.  Bourdillon  420  A 

V.  Dickson  100  A,  108, 112, 114,  378 
V.  Home  Ins.  Co.  21,  583 

V.  Mercantile  A.  &  G.  Ins.  Co.  494 
V.  Niagara,  &c.  Ins.  Co.  505 

V.  Phoenix  Ins.  Co.      466,  492,  495 
V.  Quebec  Ins.  Co.  255 

V.  Security  F.  Ins.  Co.  469  D 

V.  Sun  Fire  Office  67  G 

Scottish   Union,   &c.  Ins.   Co.  v. 

Dangaix  67 

V.  Petty  289 

Scripture  v.  Lowell  Mut.  Fire  Ins. 

Co.  402,  413,  416 

Sea  Ins.  Co.  v.  Fowler  420 

V.  Hadden  454 

Seal  V.  Farmers'  Ins.  Co.       285,  294  C 

Seaman  v.  Enterprise,  &c.  Co.  90 

17.  Loring  452  E 

V.  West  452  B 

Seam  an  s  c.  North  Western  Mut. 

Life  Ins.  Co.  858,  502  a 

Seamen's  Fr.  Soc.  v.  Hopper  320 

Searle  r.  Dwelling- House  Ins.  Co.    138, 

469  C 
Searles  v.  Manhattan  Elevated  R. 

Co.  517  A 

Seavey  v.  Central  Ins.  Co.  420 

Secor  V.  Dalton  391 

Security    Co.   i'.   Panhandle   Nat. 

Bank  447  A 


Section 
Security   Fire   Ins.   Co.   v.   Ken. 

Mar.  &  Fire  Ins.  Co.  15,  18,  23 

Security  Ins.  Co.  v.  Bronger     287,  292 

V.  Farrel  424 

V.  Fay  498,  507 

V.  Metie  263  A,  294  G 

V.  St.  Paul's  Ins.  Co.  434 

Security  Life  Ins.  Co.  v.  Gober        341 

Seiders  v.  Merchants'  L.  Ass'n  06 

Seigrist  v.  Schmoltz  117,  452  A 

Seiler  v.  Economic  L.  Ass'n  324 

Selby  I'.  Mutual  L.  Ins.  Co.  158 

Sellers  v.  Commercial  F.  Ins.  Co.    125, 

500 
Selvage  i\  John   Hancock   Mut. 

Life  Ins.  Co.  360  C 

Semraes  v.  City  Fire  Ins.  Co.      39,  486 

r.  Hartford  Ins.  ('o.  350 

Sergent  v.  Liverpool,  &c.  Ins.  Co.     465 

Servoss  v.  Western  Mut.  Aid  Soc. 

561  A 
Seutell  V.  Oswego  Co.  Farm.  Ins. 

Co.  249  I,  291  A,  294  E 

Severance  v.  Continental  Ins.  Co.  566  B 

Seward  v.  Rochester  494 

Sexton  V.  Hawkeye  Ins.  Co.  249  C,  402 

V.  Montgomery  County  Mut. 

Ins.  Co.  143,  152,  228,  469 

Seybert's    Adm.    v.   Penn.    Mut. 

Fire  Ins.  Co.  294  a 

Seybold  v.  Garceau  433  A 

Seyk  I'.  Millers'  Nat.  Ins.  Co.  30,  421  a, 

560  B 
Seyms  v.  N.  Y.  Life  Ins.  Co.  39  A 

Seyton,  In  re  399  D 

Shackelford  v.  Knights  of  Damon  55  A 
Shackett  v.  People's  Mut.  Benefit 

Society  479 

Shackleton  v.  Sun  Fire  Office      249  D 
Shader  v.  Railway,  &c.  Ins.  Co.       299, 

531 
Shafer  v.  Phoenix  Ins.  Co.  274,  501 
Shaffer  v.  Spangler  83,  459  E 

Shakey  v.  Hawkeye  Ins.  Co.  67 

Shakman  v.  U.  S.  Credit  System 

Co.  1,  2,  544 

Shank   v.  United   Brethren,   &c. 

Soc.  325 

Shannon  v.  Gore  Dist.  Ins.  Co.  366,  420 

V.  Hastings  Mut.  Ins.  Co.       180  a, 

371,  466 

V.  Nugent  75 

Sharland  v.  Washington  L.  Ins. 

Co.  325,  465 

Sharpe  v.  Commercial  Travelers' 

Mut.  Ace.  Ass'n  465 

Sliarpless  v.  Hartford  F.  Ins.  Co.  401  a 

Shattuck  V.  Mut.  Life  Ins.  Co.  66 

Shaughnessy  v.   Rensselaer  Ins. 

Co.  558, 594 

Ixxix 


TABLE  OF  CASES. 


Shaw  V.  JFAna.  Ins.  Co. 

V.  Berksliire  Life  Ins.  Co 

V.  iirenun's  Ins.  Co. 

V.  Home  Life  Ins.  Co. 

I'.  Kep.  Life  Ins.  Co. 

r.  Kobberds  218,230,241,408 

V.  Scottish  Ins.  Co.  477,  497 

V.  St.  Lawrence  County  Mut. 

Ins.  Co.  287,  373 

Shawe  i'.  Felton  30 

Siiawmut  Mut.  Fire  Ins.  Co.  v. 

Stevens  133,  137,  140,  206 

Shawmut  Sugar  Co.  r.  Hampden 

Ins.  Co.  445 

Shawmut  Sugar  Refining  v.  Peo- 
ple's Mut.  Fire  Ins.  Co.  465 
Shay  V.  Nat.  Ben.  Society     340,  561  A 
Shea  i;.  Mass.  Benefit  Ass'n             75  B 
Shearman   v.   Niagara   Fire   Ins. 

Co.  381,  384,  385  A 

Sliedden  v.  Heard  144  D,  345  E 

Sheerer  v.  Manliattan  L.  Ins.  Co.  344  E 
Sheldon  r.  Atlantic  Fire  &  Mar. 

Ins.  Co.  135,  359,  360,  501,  584 

V.  Conn.  Mut.  Life  Ins.  Co.       134, 

146,  360,  565 

V.  Hartford  Fire  Ins.  Co.     159,  251 

V.  Hekla  Fire  Ins.  Co.  43  F 

Slieilenberger  r.  Ransom  407 

Shepherd  v.  Chewter  452  F 

V.  Union  Mut.  Fire  Ins.  Co.      170, 

227,  269 

Slierboneau  v.  Beaver  Mut.  Fire 

Ins.  Ass.  80,  87,  287 

Slierman  v.  Madison  Ins.  Co.  435 

Shertzer  v.  Mut.  Fire  Ins.  Co.       17,  27 
Sherwood  v.  Agr.  Ins.  Co.      266,  401  a 
Shields  v.  Scot.  Ass.  Corp.     421  a,  591 
V.  Sharp  399  N 

Shilling  V.  Ace.  Death  Ins.  Co.         298 
Shirk-y  v.  Mut.  Ass.  Soc.  563 

Shoemaker  r  Glens  Falls  Ins.  Co.     159 
Short  r.  Home  Ins.  Co.  249  I 

Shotwell  ('.  Jefferson  Ins.  Co.  267 

Slircwshury  r.  Blount  188  D 

Shugsiert  r.  Lycoming  F.  Ins.  Co.     511 
Siiultz  V.  Ilawkeye  Ins.  Co.  358 

r.  Pacific  Ins.  Co.  583 

Shnman  v.  Knights  of  Honor  465 

Sliunk  r.  Gegenseitiger  560  a 

Shiirtleff  c.  Piicrnix  Ins.  Co.  365  a 

Sias  r.  Roger  Williams  Ins.  Co.       .379 
Sil.bald  ;•.  Hill  195,  196,  197,  .308 

Sibley  ?-.  Prescott  Ins.  Co.     Ill,  424  A 
V.  St.  Paul,  &c.  Ins.  Co.     443,  477, 
583 
Sickles  r.  Brahhitts  364 

Sierra   Milling,  &c.   Co.  v.   Hart- 
ford Fire  Ins.  Co.  199,  252 
Sillem  V.  Thornton     158,  218,  23o',  257 
Ixxx 


[The  references  are  to  the  sections.] 

Section 
Siltz  V.  Hawkeye  Ins.  Co.  138  A,  423  A 
Silverberg  v.  Phenix  Ins.   Co.     504  A, 

511 
Simeral   v.  Dubuque    Mut.   Fire 

Ins.  Co.  377 

Sinimes  v.  Marine  Ins.  Co.  87  A 

Simmons  v.  Ins.  Co.  133  A,  583 

Simon  v.  Boydell  26 

Simons  v.  N.  Y.  Life  Ins.  Co.  133 

Simonton  v.   Liverpool  Life  Ins. 

Co. 
Simpson  v.  Ace.  Death  Ins.  Co. 


Section 
78,80 
341 
578  a 
576 
61 


23  D 
353, 
854 

V.  Penn.  Fire  Ins.  Co.  371 

V.  Va.  L.  Ins.  Co.  827,  478 

Sims  V.  State  Ins.  Co.  239 

Sinclair  v.  Canadian,  &c.  Ins.  Co.     285 

V.  Mar.  &  Pass.  Ins.  Co.      519,  530 

V.  Phcenix,  &c.  Ins.  Co.  168,  296,  297 

Singleton  v.  Boone  County  Ins. 

Co.  425 

V.  St.  Louis  Mut.  Life  Ins.  Co.  107, 
107  a,  398 
Sinkler  v.  Indiana  Turnpike  Co.      549 
Siniiissippi  Ins.  Co.  v.  Taft  559 

Sisk  V.  Citizens'  Ins.  Co.        287  B,  369 
Siier  V.  Morrs  424 

Skarf  V.  Soulby  391  B 

Skillings  v.  Mass.  Ben.  Ass.  459  D 

Skipper  w.  Grant  496  B 

Slater  Mut.  Ins.  Co.  v.  Barstow       557 
Slaugliter's  Case  577 

Sleeper  r.  Ins.  Co.  180  a,  248 

V.  New  Hampshire  Ins.  Co.        477 
Slim  V.  Croucher  573 

Slinkard  v.  Manchester  Fire  Ass. 

Co.  401  A 

Sloat  V.  Royal  Ins.  Co.        13,  365,  366, 

435,  436  a 

Slobodisky  v.  Phoenix  Ins.  Co.  368,  566 

Sloman     v.     Mercantile     Credit 

Guarantee  Co.  465 

Small  V.  Jose  399  L 

V.  Westchester  F.  Ins.  Co.  269,  279, 

291  A,  379,  479,  578  a 

Smedley  v.  Felt  890 

Smiley  v.  Citizens'  Fire,  Mar.,  & 

Life  Ins   Co.  415,  -587  A 

Smillie  r.  Quinn  391  A 

Smith  V.  Ace.  Ins.  Co.  518 

V.  Mtna.  Life  Ins.  Co.  123,  212, 295, 

306 
17.  Bell  560  A 

V.  Binder  593 

V.  Bowditch  Ins.  Co.  87,  287 

V.  Bullard  459  D 

V.  Cash.  Mut.  Fire  Ins.  Co.         149 
V.  Charter  Oak,  &c  Ins.  Co.  40,  350 
V.  City  of  London  Ins.  Co.      43  F, 
504  A 


TABLE   OF  CASES. 


[The  references  are  to  the  sections.] 


Section 

Smith  V.  Cologan  124 

V.  Columbia  Ins.  Co.  293,  424,  456 
V.  Conn.  Ins.  Co.  294  b,  372,  497 
V.  Continental  Ins.  Co.  270,  344  a, 
345  E,  355,  369,  469  C 
V.  Empire  Ins.  Co.  122,  189,  290 
V.  Farmers'  Mut.  Ins.  Co.  145,  274 
V.  Ferris  507 

V.  German  Ins.  Co.  239  A 

V.  Glens  Falls  Ins.  Co.        442,  575 
V.  Haverhill  Mut.  Fire  Ins.  Co.  147, 
465,  471 
V.  Head  399  Q 

V.  Hill  595 

V.  Home  Ins.  Co.  124  A,  208, 

373  A,  373 B 
V.  Hunterdon  Co.  Mut.  Fire 

Ins.  Co.  12  C 

V.  Insurance  Co.  131,  145 

V.  Knowlton  465 

V.  Lascelles  124 

V.  Meclianics'  &  Traders'  Mut. 

Fire  Ins.  Co.  157,  191,  231 

V.  Met'n  L.  Ins.  Co.      187,  298,  303 
V.  Mo.  Valley  Ins.  Co.  390 

V.  Monmouth  Mut.  Fire  Ins. 

Co.  267,  379 

V.  Mut.  Life  Ins.  Co.  66,  344  a,  502 
V.  Nat.  Ben.  Soc.  307,  324,  459  E 
V.  National  Credit  Ins.  Co.  2,  5,  67 
V.  Nat.  Life  Ins.  Co.  344  E,  356  A 
V.  New  England  M.  F.  Ins.  Co.  126, 
340, 345  E 
V.  Niagara  Fire  Ins.  Co.  292,  292  B, 
469  D 
V.  Northwestern  Mut.  L.  Ins. 

Co.  298 

V.  Odlin  20 

V.  Phoenix  Ins.  Co.  273  A 

V.  Pinch  75  B 

V.  Preferred    Masonic   Mut. 

Ace.  Ass'n  494,  531  A 

V.  Price  124 

V.  Provident  Sav.  L.  Ass.  So- 
ciety 126, 360 
V.  Queen  Ins.  Co.  477 
V.  Koyal  Ins.  Co.  82 
V.  Saratoga  County  Mut.  Ins. 

Co.  381  a,  385.  553 

V.  State  Ins.  Co.  23,  469  C 

V.  St.  Paul  F.  &  M.  Ins.  Co.     288, 

504  A 

V.  Whitbeck  342 

Snell  V.  Atlantic  Fire  Ins.  Co.  566 

V.  Delaware  Ins.  Co.  423  A 

Snodgrass  v.  Gavit  493 

Snow  V.  Carr  122  A 

Snovvden  v.  Kittanning  504  A 

Snyder  v.  Dwelling-Houselns.  Co.  126. 

239A,  452r,  469D 

VOL.  I.  — / 


Section 
Snyder  v.  Farmers'  Ins.  &  Loan 

Co.  158, 164 

V.  Mut.  Life  Ins.  Co.  312 

Sofge  V.  Knight-s  of  Honor  399  O 

Sohier  v.  Norwich  Fire  Ins.  Co.         402 
Soli  V.  Farmers'  Mut.  Ins.  Co.  420 

Solicitors'  &  General  Life  Ins.  Co. 

V.  Lamb  324 

Solms   V.  Rutgers  Fire  Ins.  Co.     129, 

566 
Solomon  v.  Continental  F.  Ins.  Co.  460, 

462 
Solvency  Mut.  Guar.  Ins.  Co.  v. 

Freeman  544 

V.  York  540,  544 

Somerfield  v.  Ins.  Co.  365  C 

V.  State  Ins.  Co.  365  C 

Soraers  v.  Atheneum  Fire  Ins.  Co.  143, 

186 
Somerset  Co.  Mar.  Fire  Ins.  Co. 

V.  Usaw  247,  249,  583 

Somerset  Ins.  Co.  v.  May  64 

Soorholtz  v.  Marshall  County  Far- 
mers' Mut.  F.  Ins.  Co.  469  C 
Souder  v.  Home  Friendly  Society   112, 

398 
Soupras  v.  Mut.  Fire  Ins.  Co.  368 

Sourdon  v.  Ins.  Co.  of  N.  A.  386 

Soutiiard  v.  Railway  Passengers' 

Ass.  Co.  170,  515,  534 

South  Australian  Ins.  Co.  v.  Randall  421 
South   Bend  Toy  Manuf.  Co.  v. 

Dakota  F.  &  M.  Ins.  Co.  151 

Southcombe  v.  Merriman  299 

Southern  Fertilizer  Co.  v.  Reams      279 
Southern  Home  Building  &  Loan 

Ass'n  V.  Home  Ins.  Co.  469  C 

Southern  Ins.  Co.  i'.  Lewis  87,  244,285 

V.  Parker  263  A 

Southern  Life  Ins.  Co.  v.  Booker     134, 

214,  359,  360 

V.  Kempton  60,  191 

V.  McCain  126,  358,  502 

V.  Wilkinson  180a,  296 

Southern  Mut.  Ins.  Co.  v.  Turnley  471 

V.  Yates  145 

Southern   Mut.   Life  Ins.  Co.  v. 

Montague  188  F,  344  F 

V.  Taylor  341 

Southside  Fire  Ins.  Co.  v.  Mueller     67 
South    Staffordshire    Tramways 

V.  Sickness  Ass.  Co.  514 

Soutiiwest  Lead   &   Zinc    Co.  v. 

Phoenix  Ins.  Co.  420  A 

Southwick  V.  Atl.  Fire  &  Mar.  Ins. 

Co.  287  B 

Sovereign  Fire  Ins.  Co.  v.  Moir       237 

V.  Peters  379 

Soye  r.  Mercliants'  Ins.  Co.  248 

Spalding  v.  Miller  448 

Ixxxi 


TABLE  OF   CASES. 
[The  references  are  to  the  sections.] 


Section 

Sp.re.HomeMut.Ins.Co^75^A,83, 

Sparrow  v.  Mut.  Ben.  Life  I"«- Co-jgjj 

r  Universal  Fire  Ins.  Co.  462 

Spaulding  V.  N.  Y.,  &c.  Ins  Co.  o/b 
S pt-agle  r.  Dwelling-House  Ins.  Co.  247 
Speer..  I'l.cenix  Mut.  Life  lus.  Co.  ob9 
Spenseley  r.  Lancastrian  Ins.  Co.  405 
Sperry  v.  Del.  Ins.  Co.  4b8 

f    Springfield   Fire   &   Mut. 

ins.  Co.  29B,239B 

Spies  i:  Greenwich  Ins  Co.  252 

Spinning  r.  Ohio  Life,  &c.  Co.  o94 

Spitzer  r.  St.  Mark's  Ins.  Co.  03,  222 
Splann  v.  Chew  399  L,  u52 

Spoeri  v.  Mass.  Mut.  Life  Ins.  Co.  361 
Sprague   c.    Holland  Purch.  Ins. 

Co.  ^^^ 

Spratley  v.  Hartford  Ins.  Co.  420 

Springer  v.   Anglo-Nevada  Ass. 

Corp.  ^         21 

Springfield  Fire  &  Mar.  Ins.  Co. 

V.  Allen  267,  283 

I'.  Brown  ^^58 

V.  McKinnon  &  Call  67  E 

V.  McLimans  159,  230,  248 

V.  Payne  '*^4 

Spring  Garden  Ins.  Co.  v.  Scott      120, 

^     ^  145 

Spring  Garden  Mut.  Ins.  Co.  v. 

Evans  465,  471,  505 

Sprott  V.  Ross  200 

Sproul  V.  Western  Ass.  Co.  23  C, 

294  C,  294  E,  322 
Spruill  V.  N.  C.  Mut.  Life  Ins.  Co.  320, 
'  830,  403 

Spurr  V.  Home  Ins.  Co.  506 

Squier  v.  Hanover  F.  Ins.  Co.  126 

Stacey  v.  Franklin  Fire  Ins.  Co.        13, 
365,  365  B,  367 
Stache  v.  St.  Paul,  &c.  Ins.  Co.        442 
Staekpole  v.  Simon  295 

Stainbank  v.  Penning  96 

Stambaugh  v.  Blake  103  A 

Stamps  !•.  Commercial  Ins.  Co.  4.32 
Standard  Fire  Ins.  Co.  ;;.  Wren  423  A 
Standard  Ins.  Co.  v.  Langston  531  A 
Standard   L.  &  Ace.  Ins.  Co.   v. 

Davis  144  A,  465 

V.  Martin  187,  202 

V.  Schmaltz  515  n 

V.  Thornton  325 

V.  Ward  306 

Standard  Oil  Co.  v.  Triumph  Ins. 

Co.  123 

Standard   Sng.  Refinery   v.  The 

Centennial  165  A 

.^tandley  v.  N.  W.  Mut.  Life  Ins. 
Co.  569 

Ixxxii 


Section 

Stanley  v.  Northwestern  Life  Ass.  562 
V  Western  Ins.  Co.     404,  415,  416 
Stannard  v.   Am.  Pop.  Life  Ins. 

Qq  2oO,  3U5 

Starck  v.  Union  Central  L.  Ins.  Co.  478 
Stark   County  Mut.  Ins.    Co.    v 

Kurd  24,  369 

Starkweather  v.  Cleveland  Ins.  Co.  264, 

386 

State  V.  Baltimore  &  0.  R.  Co.    457  B 

V.  Doyle  ^78 

V.  Ins.  Co.  548,  bi8a 

V.  Manufacturers'  Mut.  Fire 

Ass'n  557 

V.  Matthews  557 

V.  Merchants'  Exch.  Benev. 

Soc.  550  a 

V.  Phipps  1,  578  a 

V.  Williams  420 

State  Board  of  Agri.  v.  R.  R.  Co.       15 

State  Fire  &  Mut.  Ins.  Co.  v.  Por- 

ter  22  A,  402 

State  Ins.  Co.  v.  Belford  465 

..  Gray  144  A,  285 

V.  Hughes  241 

V.  Maackens  461,465,488 

V.  New  Hampshire  Trust  Co. 

188  C,  364 
V.  Oregon  Ry.  &  Nav.  Co.  453 
V.  Richmond  138  B 

V.  Stoffels  479 

V.  Taylor  24. 

,,.  Todd  294  b,  468 

State  Mut.  F.  Ins.  Ass'n  r.  Brink- 
ley  Stave  and  Heading  Co.      66,  67, 
^  557,  578  a 

State  Mut.  Fire  Ins.  Co.  v.  Arthur  156 
V.  Roberts  227,  379,  382 

Statham  v.  N.  Y.  Life  Ins.  Co.     39,  40 
Stauffer  v.  Manheim  M.  F.  Ins.  Co.  240 
V.  Penn  M.  F.  Ins.  Ass'n      164,  368 
Staunton  v.  West.  Ass.  Co.  345  a 

Stearns  v.  Quincy  Mut.  Fire  Ins. 

Co.  ^        •'  425  C 

Stebbins  v.  Globe  Ins.  Co.        164,  180, 

191,  225,  244 

Steel  V.  Phenix  Ins.  Co.  479 

Steele  v.  Franklin  Fire  Ins.  Co.      420, 

456 
V.  German  Ins.  Co.  369,  500 

Steems  v.  Sovereign  Fire  Ins.  Co.   591 
Steen  v.  Niagara  Fire  Ins.  Co.     249  II, 
282  A,  292,  479 
Steers  v.  Ins.  Co.  242 

Stehlick  v.  Milwaukee  Mechan- 
ics' Ins.  Co.  14,  125 
Steight,  Ex  parte  390 
Stein  V.  National  L.  Ass'n  513 
Steinbach  v.  Lafayette  Fire  Ins. 
Co.                                         232, 239 


TABLE  OF  CASES. 


[The  references  are  to  the  sections.] 


Section 
Steinbach  v.  Relief  Ins.  Co.  232,  566 
Steinback  r.   Diepenbrock  110,  112 

Steinle  v.  New  York  Life  Ins.  Co. 

55  A,  340 

Steinmetz  v.  Franklin  Ins.  Co.  227 

Stennett  v.  Penn.  Fire  Ins.  Co.    133  D 

Stensgaard  i\  Nat.  Fire  Ins.  Co.  249  A 

V.  St.  Paul  Real  Estate  Title 

Ins.  Co.  2 

Stephens  v.  Baird  502 

'i;.  Capital  Ins.  Co.  360 

V.  111.  Mut.  Fire  Ins.  Co.         81,  82 

Stephenson  v.  P.  F.  &  M.  Ins.  Co.    492 

V.  Stephenson  399  <■) 

Stepp  V.  National  L.  &  M.  Ass'n       465 

Sterling  v.  Mer.  Mut.  Ins.  Co.  552,  555, 

591 
Sternes  v.  Manhattan  Life  Ins.  Co.  566 
V.  Warner  398 

Sternfield  v.  Park  Fire  Ins.  Co.        477 
Sternman  v.  Met'n  L.  Ins.  Co.  298 

Stetson  V.  Mass.  Fire  Ins.  Co.  222,  225, 

257 
Stettiner   v.    Granite   Ins.    Co.       228, 

268  B 
Stevens  v.  Citizens'  Ins.  Co.  365  B,  464, 

483 

V.  Lane  390 

V.  Phoenix  Ins.  Co.  569  A 

V.  Queen  Ins.  Co.  285 

Stevens,  Adm'r,  v.  Warren,  Adm'r  1 10, 

396,  398 

Stevenson  v.  Phoenix  Ins.  Co.       365  C 

V.  Snow  4 

Steward  v.  Phoenix  Fire  Ins.  Co.     159, 

423 
Stewart    v.    Equitable    Mut.    L. 

Ass'n  303 

V.  Helvetia-Swiss  F.  Ins.  Co.  70  B, 

126 
V.  Union  Mut.  L.  Ins.  Co.     345  E, 

360 

Stieglitz  V.  Belding  2 

Stiilwell  I.  Mut.  Life  Ins.  Co.  390 

c.  Staples  424,  452  A,  456 

Stimpson  v.  Monmouth  Mut.  Fire 

Ins.  Co.  447,  463 

Stobart  V.  Dryden  214 

Stockdale  i'.  Dunlop  80,  96 

Stocker  v.  Boston  Mut.  F.  Ins.  Co.     156 
Stocks  V.  Dobson  396 

Stockton  C.  H.  &  Agr'l  Works  v. 

Glens  Falls  Ins.  Co.  496  B 

Stokell  V.  Hey  wood  21 

Stokes  I'.  Coffee  391 

V.  Cox  159,  218,  257 

StoUe  V.  JEtna  Ins.  Co.  383 

Stone  V.  Franklin  Fire  Ins.  Co.     67  F, 

67  K 
V.  Granite  State  F.  Ins.  Co.       248 


Section 

Stone   V.  Hawkeye  Ins.   Co.      133  A, 

144  A,  465 

V.  Howard  Ins.  Co.  231,  253 

V.  U.  S.  Casualty  Co.  306 

Stone,  Adm'rs,  v.  U.  S.  Casualty 

Co.  158,  631,  532,  533 

Stoneham  ik  Ocean,  &c.  Ins.  Co.       465 
Storer  v.  Elliot  Fire  Ins.  Co.  367 

Stormont    v.    Waterloo    Life    & 

Casualty  Ins.  Co.  312 

Storms  V.  Canada  Farmers'  Mut. 

Ins.  Co.  553 

Story  V.  Hope  Ins.  Co.  502 

Stougliton  V.  Manufacturers'  Nat- 
ural Gas  Co.  453 
Stout  V.  City  Wre  Ins.  Co.   93, 157,  248, 
379.  478,  487,  566 
V.  Com.  Union  Ass.  Co.              233 
Stovall  V.  Fireman's  Ins.  Co.            239 
Stow  V.  Wadley  557 
Stowe  V.  Phinney                            459  G 
Straker  v.  Phenix  Ins.  Co.     177, 401  B, 

566 
Stratton  v.  North  American,  &c. 

Ins.  Co.  317 

Straus  V.  Eagle  Ins.  Co.  595 

Strauss  v.  Imp.  Fire  Ins.  Co.  403 

V.  Phenix  Ins.  Co.  369 

Straw  V.  Truesdale  496  B 

Street  v.  Kigby  495 

Streetcr  v.  Ins.  Co.  307,  322 

Strickland  v.  Council  BlufTs  138 

Stringham  i\  St.  Nicholas  Ins.  Co.     132 

Strohny.  Hartford  Fire  Ins.  Co.  51,448 

Strong  V.  Am.  Cent.  Ins.  Co.  11 

V.  Manuf.  Ins.  Co.    7,  81,  185,  269  a, 

272,  274,  285,  424 

V.  Phoenix  Ins.  Co.  11 

V.  Sun  Mutual  Co.  415 

Strunk  v.  Firemen's  Ins.  Co.  247 

Stuart  r.  Columbian  Ins.  Co.  83  a 

V.  Sutcliffe  112,  379 

Stupetzki  V.  Transatlantic   Fire 

Ins.  Co.  248 

Sturm  V.  Atlantic  Mut.  Ins.  Co.        80, 

366,  373 

V.  Williams  423  A 

Styan,  In  re  395 

Sty  low  V.  Wis.  Odd  Fellow's  Mut. 

Life  Ins.  Co.  661  A 

Succession  of  Hearing  890,  391 

Keegan  392 

Re  i  ley  396 

Suckley  v.  Delafield  188  B,  405 

Suffolk  Fire  Ins.  Co.  v.  Boyden       116, 

4.36 

Sugden  v.  Farmers'  Ins.  &  Loan  Co.  159 

V.  Mut.  Life  Ins.  Co.  312 

Suggs  V.  Ins.  Co.  365  B,  478 

V.  Liverpool,  &c.  Ins.  Co.  365 

Ixxxiii 


TABLE   OF   CASES. 
[The  references  are  to  the  sections.] 


Section 

Sullivan  v.  Cotton  States  Life  Ins. 

Co.  29  B 

V.  Hartford  F.  Ins.  Co.  oO 

t,  Mass.  Mut.  Fire  Ins.  Co.  555,567 
V.  Piienix  Ins.  Co.  124  A,  144  A 
V.  U.  Pacific  K.  U.  Co.  453 

Summerfield   v.  North  British  & 

Merc.  Ins.  Co.  294  E,  494 

Summers  v.  U.  S.  Ins.  An.  &  Tr. 

Co.  218 

Sun  Fire  Office  i-.  Clark   269,  364,  369, 

379 
V.  Ermentrout  67,  67  G,  126 

V.  Wright  79,  423 

Sun  Ins.  Co.  v.  Greenville  B.  &  L. 

Ass'n  287  B,  566 

V.  Jones  263  A,  479 

V.  Varble  364 

Snn  Ins.  Office  v.  Merz  11,  117 

Sun  L.  Ins.  Co.  v.  Taylor  478 

Sun  Mut.  Ins.  Co.  v.  Crist    66,  70  a,  465 
V.  Dudley  263  A,  469  C 

r.  Holland  31  A,  460 

V.  Miss.  Valley  Trans.  Co.    457  A, 
457  B 
V.  Ocean  Ins.  Co.  11 

V.  Saginaw  349  B 

V.  Texarkana  Foundry  &  Ma- 
chine Co.  230 
V.  Wright                                    43  F 
Sunbury  Fire  Ins.  Co.  v.  Humble 

345  G 
Sunderland  Mar.  Ins.  Co.  v.  Kear- 
ney 589 
Suppiger  i'.  Covenant  Mut.  Ben. 

Ass.  307,  469 

Supple  V.  Cann  136,  502 

Supreme  Assembly  v.  Campbell       379 
Supreme    Commandery,    &c.    v. 

Ainsworth  64  A,  307 

Supreme  Conclave  Roy  Adelphia 

r.  Capella  399  M,  399  0 

Supreme  Council  v.  Brashears  325 

V.  Garrigues  514,  563  A 

V.  Tracy  399  0 

Supreme  Lodge  v.  Knight    552,  563  A 

V.  La  Malta  325 

i;.  Schmidt  399  L 

Susquehanna  Ins.  Co.  v.  Perrine      149, 

258,  552 

Susquehanna  Mut.  Fire  Ins.  Co.  v. 

El  kins  349  B 

V.  Gackenbach  557,  659 

V.  Staats  287,  373  A,  369  G 

V.  Stauffer  260  A 

V.  Swank  560  A 

V.  Tunkliannock  Toy  Co.  461 

Sussex    County   Mut.    Fire   Ins. 

Co.  V.  Woodruff  82, 285, 287,  424, 457, 

565,  584,  591 

Ixxxiv 


Section 
Sutherland  v.  Old  Dominion,  &c. 

Ins.  Co.  365 

V.  Pratt  80,  33  A 

V.  Sun  Fire  Office  430 

Suydam  v.  Columbus  Ins.  Co.  566 

Swain  v.  Security  Live-Stock  Ins. 

Co.  67  L,  547 

Swampscot  Machine  Co.  v.  Par- 
tridge 653,  596 
Swan  V.  Liverpool,  &c.  Ins.  Co.       465, 

469  B 

V.  Snow  391 

V.  Watertown  Fire  Ins.  Co.      167, 

577 

Swarthout  v.  Chicago  R.  R.  Co.       454 

Swartz  V.  Ins.  Co.  511 

Sweat   V.  Piscataqua   Mut.    Ins. 

Co.  292  B 

Sweeney  v.  Franklin  Ins.  Co.  89 

V.  Met'n  L.  Ins.  Co.  186 

V.  Promoter  Life  Ins.  Co.  501 

Sweeting  v.  Mutual  F.  Ins  Co.  365 

Sweetser   v.  Odd  Fellows'  Mut. 

Aid  Ass.  361 

Swenson  v.  Sun  Fire  Office  378  A 

Swete  y.  Fairlie  123,200,213 

Swett  V.  Citizens'  Mut.  Relief  Soc. 

136  A, 305 

Swick  V.  Home  Ins.  Co.    110,  170,  187, 

299,  300,  393 

Swift  V.  Mass.  Mut.  Life  Ins.  Co.     187, 

200,  207,  214 

V.  Railway,  &c.  Conductors' 

Mut.  Aid,  &c.  Ass.  550a 

V.  Railway,  &c.  Ins.  Co.  395 

V.  Vermont    Mut.  Fire    Ins. 

Co.  289 

Swords  V.  Blake  595 

Sykes  v.  Perry  Co.  Mut.  Ins.  Co.     152, 

371 
Symonds   z'.    Northwestern,    &c. 

Ins.  Co.  344  a 

Syndicate  Ins.  Co.  v.  Bohn  287  D 

V.  Catchings  126,  469  D 


T. 

Tabor  v.  Michigan,  &c.  Ins.  Co.       397, 

569 
Tait  V.  N.  Y.  Life  Ins.  Co.  350  a 

Talamon  v.  Home  Ins.  Co.  404 

Talbott  V.   Fidelity  &   Casualty- 
Co.  578  a 
Talcott  V.  Field                                 459  E 
Tallman  v.  Atlantic  Fire  &  Mar. 

Ins.  Co.  100,  268,  270,  279 

Tanneret  v.  Merch.  Mut.  Ins.  Co.     415 
Tarbell  v.  Vermont  Mut.  F.  Ins. 
Co.  269 


TABLE  OF  CASES. 


[The  references  are  to  the  sections.] 


Tarleton  v.  Staniforth  357 

Tasker  i\  Kenton  478 

Tate  V.  Citizens'  Mut.  Ins.  Co.  138,  153 
V.  Commercial  Building  Ass'n  110 
V.  Hyslop  215  A 

Taunton  v.  Koyal  Ins.  Co.  417 

Tayloe    v.  Merchants'    Fire  Ins. 

Co.  47,  134,  345,  462,  468,  469 

Taylor  i'.  ^tna  Ins.  Co.    338,  465,  466, 

474,  582 

V.  Bullen  156 

V.  Charter  Oak,  «S;C.  Ins.  Co.  352  A, 

566,  577 

V.  Germania  Ins.  Co.  23,  349 

V.  Gilleau  459  F 

V.  Life  Ass.  of  America   592,  594  a 

V.  Lowell  101 

V.  Merchants'  Ins.  Co.        270,  479 

V.  Mutual  Reserve  Fund  L. 

Ass'n  578  a 

V.  North  Star  Mut.  Ins.  Co.       594 
i\  Phoenix  Ins.  Co.  70  B 

V  Roger  Williams  Ins.  Co.        466 
V.  State  Ins.  Co.       3,  126,  364,  368 
Tebbetts  v.  Hamilton  Mut.  Ins. 

Co.  258,  570,  591 

Teerpenning  v.  Corn  Ex.  Ins.  Co.  423  B 
Tefft  V.  Providence-Washington 

Ins.  Co.  291  A 

Tennant  i'.  Travellers'  Ins.  Co.    360  B, 

517  A 
Tenness  v.  N.  W.  Mut.  Life  Ins. 

Co.  452 

Tennessee  v.  Davis  5(8 

Tepper  v.  Supreme  Council  399  O 

Terry  v.  Imperial  Ins.  Co.  578 

V.  Mut.  Life  Ins.  Co.        69  a,  316, 
319,  325,  5(J6 
Terwilliger  v.  Royal  Arcanum     579  A 
Tesson  v.  Atlantic  Mut.  Ins.  Co.       184 
Teutonia  Ins.  Co.  v.  Boylston  Mut. 

Ins.  Co.  175 

V.  Ewing  125 

V.  Howell  30,  126,  189 

V.  Mueller  359 

V.  Mund  424  A 

Teutonia  Life   Ins.   Co.   v.  Agr. 

Ins.  Co.  249  J 

V.  Anderson  502  a 

V.  Beck  206 

Texas  Banking  Co.  v.  Hutchins       508 

Texas    Banking   &    Ins.    Co.    i'. 

Cohen  279 

Texas  &  Pac.  R.  Co.  v.  Love  457  B 
Thatch  V.  Metropole  Ins.  Co.  447  A 
Thayer   v.  Middlesex  Mut.  Fire 

Ins.  Co.  48,  49 

The  Frank  G.  Fowler  454 

The  Manistee  454 

The  Orient  165  A 


The  Schooner  Reeside 
The  Sidney 
The  Titania 
Thelluson 
Theobald  v. 
Co. 


Fletcher 


560 

365 

399  O 

Ass. 

189,  247 

156 

247 


Section 

179  D 

452  E,  457  A 

66  A,  411  A 

579 

Railway  Pass.  Ass. 

521,  524,  530,  535 
Thierolf  v.  Universal  Fire  Ins.  Co.    465, 
469  B,  477 
Thomas  v.  Achilles 

V.  Builders  Ins.  Co. 

V.  Cochran 

V.  Commercial    Union 

Co. 
V.  Fame  Ins.  Co. 
V.  Hartford  F.  Ins.  Co. 
V.  Montauk  Fire  Ins.  Co.       457  C 
V.  Whallon  557,  594 

Thomas,    Adm'rs,  v.  Vankopff's 

Ex'rs  452  C 

Thompson  r.  Adams  ^    43  A 

V.  American,  &c.  Ins.  Co.  345  a,  394 
V.  Charnock  402,  495 

V.  Citizens'  Ins.  Co.  422  B 

V.  Hopper  224 

V.  Ins.  Co.  352  A,  356  A 

V.  Knickerbocker,  &c.  Ins.  Co.   342, 

356 
V.  Montreal  Ins.  Co.  404,  423 

V.  Phanix  Ins.  Co.      133,  175,  479, 

566 

y.  St.  Louis  Ins.  Co.    361,363,370 

Thomson  v.  Southern  Mut.  Ins. 

Co. 

V.  Weems 

Thorne  v.  Travellers'  Ins.  Co. 

Thornton  v.  Enterprise  Ins.  Co. 

V.  Knight 

V.  Western    Reserve     Farm 
Ins.  Co. 
Tliroop  V.  N.  A.  Fire  Ins.  Co. 
Thropp  V.  Ins.  Co.  560  A 

Thurston  v.  Burnett,  &c.  Ins.  Co.     175 
V.  Citizens'  Mut.  Fire  Ins.  Co. 
V.  Koch 
Thurtell  v.  Beaumont 
Thwing  I'.  Great  Western  In.=  .  Co. 
Ticktin  v.  Fidelity  &  Cas.  Co. 
Tidmarsh  v.  Washington,  &c.  Ins. 
Co.  188  E 

Ankerstein  96 

V.  Citizens'  Mut.  Fire 

249,  219  a 
Ethrington  174 

Phenix  Ins.  Co.  276  0 

Tilley  v.  Conn.  F.  Ins.  Co.  83,  379 

Tillou  V.  Kingston  Mut.  Fire  Ins 

Co.  279,  379 

Tilly  V.  Tilly  465 

Tilton  r.  Hamilton  Fire  Ins.  Co.       404 

Times  Fire  Ins.  Co.  v.  Hawke  433 

Ixxxv 


247 
158 
oil 
424 
573 

66  A 
589 


147 
4.34 

583 

66 

327 


Tidswell  v. 
Tiefenthal 
Ins.  Co. 
Tiernay 
Tierney 


TABLE   OF   CASES. 
[The  references  are  to  the  sections.] 
Section 


597 
390 


Times  Life  Ass.  &  Guarantee  Soc., 

Jn  re 
Tinncss  v.  Northwestern,  &c.  Ins. 

Co. 
Tischler  v.  Cal.   Farmers    Mut. 

Fire  Ins.  Co.  ,   ,      ^  ^^\fn 

Tisdale  v.  Conn.  Mut.  Life  Ins.  Co.    4b5 
V.  iMut.  Ben.  Ins  Co.  4b8 

Tisdell  V.  New  Hampsliire  F.  Ins. 

Co.  "' 

Titsworth  v.  Titsworth  399  0 

Tittemore  v.  Vermont  Mut.  Fire 

Ins.  Co.  272,  276  A 

Titus  V.  Glens  Falls  Ins.  Co.         294  6, 
366,  466,  497,  504  A 
Tobey  v.  Chipman  ^5 

Tobin  V.  Harford  422  A 

V.  Western  Mut.  Aid  Soc.  502 

Todd  V.  Liverpool,  &c.  Ins.  Co.       83  a, 

192 
V.  Piedmont,  &c.  Life  Ins.  Co.  359 
Toledo,  Peoria,  &  Wabash  R.  R. 

Co.  V.  Pindar  411 

Tolford  V.  Church  560  A 

Tolman  v.  Manuf  Ins.  Co.       426,  430, 

447 

Tome  V.  Parkersburg  Br.  R.  R.  Co.     64 

Tompkins  v.  Levy  459  B 

Tongue  V.  Nutwell  81,  456 

Tooiey  v.  Hartford,  &c.  Ass.  Co.     428, 

476,  479,  525 

Toppan  V.  Atkinson  420  B 

Topping  r.  Bickford  383,  584 

Tough  1-.  Provincial  Ins.  Co.  67 

Touteng  v.  Hubbard  350 

Towle  V.  Nat.  Guardian  Ins.  Co.        97, 

543,  544 

Towns  V.  Fire  Ass.  of  Phila.        401  B 

V.  Fitchburg  Ins.  Co.    164, 185, 290 

V.  Springfield    Fire   &   Mar. 

Ins.  Co.  465 

Townsend  v.  North  Western  Ins. 

Co.  219 

Trabandt  v.  Conn.  Mut.  Life  Ins. 

Co.  568 

Trabue  v.  Dwelling-House  Ins.  Co.   279 

Trade  Ins.  Co.  v.  Barracliff       81,  285, 

345  E, 424  A 

Traders'  Ins.  Co.  v.  Newman  81 

V.  Pacaud  287  B,  399  D,  434 

V.  Propellor  Manistee  454 

V.  Race  248,  456 

r.  Robert  379 

Traders'   Mut.   Fire  Ins.    Co.   v. 

Stone  552 

Trager  v.  Louisiana  Eq.  Life  Ins. 

Co.  67,  359 

Trail  v.  Baring  190,  197,  573 

Train  v.  Holland  69  a 

V.  Holland,  &c.  Ins.  Co.  345  a 

Ixxxvi 


Section 

494 


Trainor  v.  Phoenix  F.  Ass.^ 
Transatlantic    Fire    Ins.    Co.    v. 

Dorsey  402,  416 

Trask  v.  State  Fire  &  Mar.  Ins.  Co.    462 
Travellers'  Ins.  Co.  v.  California 


Ins.  Co. 
V.  Duniap 
V.  Edwards 
V.  Jones 
V.  Lampkin 
V.  McConkey 
V.  Melick 
V.  Murray 
V.  Myers 
V.  Ni'tterhouse 
V.  Seaver 
V.  Selden 
V.  Sheppard 
Travis  i'.  Cont.  Ins.  Co. 
V.  Peabody  Ins.  Co. 
Treadway  v.  Hamilton  Mut.  Ins 

Co.  287,  291,  552 

Tredegar  v.  Windus  566 

Tredwen  v.  Holman  493 

Trefz  V.  Knickerbocker  Life  Ins. 

Co.  185,  296,  575,  591  B 

Trench  v.  Chenango  Co.  Mut.  Ins. 

Co.  160,  162,  228,  243,  258 

Trenton  Mut.  Life   &  Fire  Ins. 

Co.  V.  Johnson  7,  75,  109,  117 

Trenton    Passenger    Ry.    Co.   v. 
Guarantors'    Liability    Indem- 
nity Co. 
Trew  V.  Railway  Pass.  Ass  Co. 


12 

324 

464 

531  A 

287  B 

322 

325 

298 

462 

325 

518,  530 

515  a,  518  A 

4G5 

87  A, 469  B 

43  D,  263  A 


2 

516, 
530 


Trinity  College  v.  Travelers'  Ins. 

Co.  112 

Triple  Link  Mut.   Ind.  Ass'n  v. 

Williams  55  A,  306,  340 

Tripp  &  Bailey  v.  Ins.  Co.     861, 445, 589 
V.   Northwestern    Live-Stock 

Ins.  Co.  547 

Trippe  v.  Provident  Fund  Soci- 
ety 465,  479 
Tritschler  v.  Keystone 'Mut.  Ben. 

Ass'n  322 

Troager  v.  La.,  &c.  Ins.  Co.  391 

Troop  V.  Anchor  Mar.  Ins.  Co.         379 

I'.  Jones  4_21rt 

V.  Mosier  452  B 

Trott  V.  City  Ins.  Co.  493,  495 

V.  Woolwich  M.  F.  Ins.  Co.        81, 

247,  287  B 

Troy  Fire  Ins.  Co.  v.  Carpenter       VIQ, 

241,  584,  590 

Trudden  v.  Met'n  L.  Ins.  Co.  465 

True  V.  Manhattan  Fire  Ins.  Co.      379 

Trull  V.  Roxbury  Mut.  Ins.  Co.         426 

Trumbull  v.  Portage   Mut.  Fire 

Ins.  Co  267 


TABLE   OF  CASES. 


[The  references  are  to  the  sections.] 


Section 

Trustees  of  First  Baptist  Churcli 

in  Brooklyn  v.  Brooklyn  Fire 

Ins.  Co.  15,  18,  21,  23  A 

Tubb  V.  Liverpool,  &c.  Ins.  Co.        239 

Tuck  V.  Hartford  Fire  Ins.  Co.        434, 

435,  439 

Tucker  v.  Mut.  Ben.  Life  Co.  112, 

409  A,  517  A 

Tuckerman  v.  Bigler  553,  654 

fi.  Home  Ins.  Co.  87  A 

Turley  v.  N.  A.  Fire  Ins.  Co.    172,  46G, 

470,  504 

Turner  v.  Burrows  27,  285,  447  B 

V.  Fidelity  &  Cas.  Co.      469  C,  479 

V.  Meriden  Ins.  Co.  216,  365  C 

V.  Stetts  424,  456 

Tuskar,  Tlie  584 

Tusson  V.  Atlantic  Mut.  Ins.  Co.       566 

Tutt  V.  Covenant  Mut.  Life  Ins. 

Co.  344  E 

Tuttle  V.  Robinson  291,  501,  553 

V.  Travellers'  Ins.  Co.  409  A 

Twiss  V.  Guaranty  Life  Ass'n   11,  591  A 
Twitchell  v.  Commonwealth  25 

Tyler  (;.  .Etna  Fire  Ins.  Co.    87,  184,  285 
V.  N.  Amsterdam  Fire  Ins.  Co.     27 
Tyrie  v.  Fletcher  4,  567 


u. 


U.  B.  Mut.  Aid  Soc.  v.  Miller  399  N 
Uhlman  v.  N.  Y.  Life  Ins.  Co.  344  D 
Uhrig  V.  Williamsburg  City  Fire 

Ins.  Co.  496  B 

Ulrich  V.  Reinoehl  8-3,  459  E 

Underbill  v.  Agawam  Mut.   Ins. 

Co.  198,  255,  423,  504 

Underwood  v.  Greenwich  Ins.  Co.      44 
V.  la.  Legion  of  Honor  560  B 

Unger  v.  People's  Fire  Ins.  Co.  591 
Union  Bank  v.  Gray  452  F 

Union  Building  Ass'n  v.  Rockford 

Ins.  Co  340 

Union  Casualty  Co.  v.  Harroll       531  A 

Union  Central  L.  Ins.  Co.  i'.  Berlin   189 

V.  Buxer  345  E 

V.  Cheever  214,  579  A 

V.  Hook  144  D 

V.  Lee  299 

V.  Moreland  345  E 

V.  Wilkes  345  E 

V.  Woods  66,  379 

Union  Ins.   Co.   v.  American  F. 

Ins.  Co.  12  D 

V.  Chipp  123, 140,  294  b 

V.  Grant  345  a,  584 

V.  Hoge  548 

V.  McGookey  590 

V.  Reif  290 


Section 

Union  L.  Ins.  Co.  v.  Haman  360 

Union  Mut.  Ace.  Ass'n  r.  Froliard     306 

r.  Miller  562 

Union    Mut.     Fire    Ins.    Co.    v. 

Keyser  591 A 

V.  Spaulding  560  A 

Union  Mut.  Ins.  Co.  v.  Commer- 
cial Mut.  Ins.  Co.  565 
V.  Wilkinson     126,  144,  144  G,  152, 
175,  180  a,  499,  500 
Union  Mut.  Life  Ins.  Co.  v.  Gil- 
bert                                  566  C 
V.  McMillen                                  577 
V.  Mowrey                            358,  511 
V.  Reif                                           299 
V.  Stevens                                399  M 
Union  Nat  Bank  v.  German  Ins. 

Co.  369 

V.  Matthews  23  D 

r.  Sixth  Nat.  Bank  575 

Union,  &c.  Ins.  Co.  i\  Keyser  560 

V.  Pottker  356,  36 1,  429,  568 

V.  Thomas  577 

United    Brethren  Mut.  Aid  Soc. 

V.  McDonald  102  A 

V.  O'Hara  419  A 

V.  White  188  A 

United    Firemen's     Ins.     Co.    v. 

Thomas  137  A,  364,  368,  369 

United  Kingdom  Ins.  Co.  v.  Dixon  395 
United  Life,  Fire,  &  Mar.  Ins.  Co. 

V.  Foote  415,  416 

V.  Insurance     Co.    of    North 

America  65 

United  Security,  &c.  Co.  v.  Ritchey  70  C 

United  States  v.  Grossmayer  40 

V.  Wiley  39,  39  A 

United    States    Express     Co.    v. 

Haines  25 

United  States  Fire  &  Mar.  Ins. 

Co.  V.  Kiniberly  247 

V.  Tardy  358,  594  a 

United  States  Life  Ins,  Co.  v.  Ad- 
vance Co.  126 
V.  Hessberg  577 
V.  Kielgart  325 
V.  Smith  4, 125,  567 
V.  Wright  567 
United  States  Mut.  Ace.  Ass.  v. 

Barry  515,  517  A 

United  States  Trust  Co.  v.  Mut. 

Ben.  Life  Ins.  Co.  -399  N 

Universal  Fire  Ins.  Co.  v.  Block  360  A, 
466,  469  B 
V.  Stewart  488 

Universal  Life  Ins.  Co.  v.  White- 
head 353 
Universal  Ins.  Co.  v.  Weiss        30,  465, 
478,  511 
Universal  Non-Tariff  Fire  Ins.  Co.    143 

Ixxxvii 


TABLE   OF  CASES. 
[The  references  are  to  the  sections.] 


Universal,  &c.  Ins.  Co.  v.  Forbes 
fntersinger  v.  Niagara  liis.  Co. 
UiUluuik  r.  Travellers  Ins.  Co. 
Upton  r.  Englehardt 

V.  Hansbrough 

V.  Jackson 

v.  Tribilcock 
Utica  Ins.  Co.  v.  Am.  Mut.  Ins.  Co. 

V.  Toledo  Ins.  Co. 
Utter  V.  Insurance  Co. 
Uzielli  1-.  Boston  M.  Ins.  Co. 

V  Commercial,  &c.  Ins.  Co 


Section 
256 
44-2 
470 
594 
593 
594 
594 
479 
125 
517  A 
11 
208 


372 
552 


Vale  r.  Phcemx  Ins.  Co.  ,„^^^,^ 

Valton  V.  Nat.  Fund  Ins.  Co.    109,  110, 

112   117,196,  203,215, 

303,  398 

Van  Allen  v.  Farmers',  &c.  Ins. 

r-Q  137  A,  loo 

Van  Alstyne  v.  Mtna,  Ins.  Co.  365 

Van  Bibber's  Adm.  v.  Van  Bibber 

399  N 
Van  Bories  v.  United  Life,  Fire,  & 
Mar.  Ins.  Co.  370 

Van  Biiren  v.  St.  Joseph  Co.  Vil- 
lage Fire  Ins.  Co. 
Vanderhoff  v.   Agricultural    Ins. 

Co.  249  H,  249 1 

Vandervolgen    v.  Manchester  F. 

Ass.  Co.  177 

Van  Deuzen  v.  Charter  Oak  Ins. 

Co.  2"0,  381 

Van  Houten  r.  Pine  447  B,  560  B 

A'ankirk  v.  Citizens'  Ins.  Co.  269 

Van  Loan  v.  Farmers'  Mut.  Fire 

Ins.  Ass'n  23A,  23C,  43C 

Vanormer  r.  Hornberger  112,  398 

Van  Schoick  v.  Niagara  Ins.  Co.     238, 
294  b,  497 
Van  Sickle  v.  Keith  126 

Van  Slyke  v.  Trempealeau  County, 

&e.  Ins.  Co.  44,  552 

Van  Twyl  v.  West  Chester  Fire 

Ins.  Co. 
Van  Valkenburgh    v.   Am.erican 
Top.  Life  Ins.  Co. 
V.  Lenox  Ins.  Co. 
V.  Lexington  Ins.  Co. 
Van   Zandt  v.  Mutual  Ben.  Life 

Ins.  Co.  316 

Vanatta  v.  N.  J.  Mut.  Life  Ins.  Co.  594  a 
Vance  r.  Foster  431 

V;,rina  v.  N.  Y.  Life  Ins.  Co.  398 

Vassar  v.  Camp  48 

\'eginan  r.  Morse  478 

Velte  r.  Clinton  Fire  Ins.  Co.  479 

Vergeront  v.  German  Ins.  Co.       469  C 

Ixxxviii 


Section 

Vezina  v.  N.  Y.  Life  Ins.  Co.  110 

Viale  V.  Genesee  Mut.  Fire  Ins 

Qo  3(9,  ooo 

Viele  V.  Germania  Ins.  Co.       143,  370, 

505,  507 
Vilas  V.  N.  Y.  Central  Ins.  Co.      29  A, 

159 

Viney  v.  Bignold  494 

Virginia,  &c.  Ins.  Co.  v.  Feagin        269 

^.Kloeber  164,292 

V.  Morgan  1^8 

V.  Saunders  ^*^ 

V.  Thomas  2o0,  267 

r.  Vaughan  "^J^ 

Vivar  v.  Knights  of  Pythias  305 

Vogel  V.  People's  Mut.  Fire  Ins. 

Co  242, 285 

Von  Genechtin  v.  Citizens'   Ins. 

Co.  ^^^ 

Von  Lindenau  v.  Desborough  200 

Von  Wein  r.  Scottish,    &c.    Ins. 

Co.  67,  67  F,  67  H,  67  K 

Voorheis  v.  People's  Mut.  Ben. 

Society  66 

Vos  17.  Robinson  469,  4 /d 

Vose  V.  Eagle  Life  &  Health  Ins. 

Co.         201,  203,  204,  205,  298 
V.  Hamilton  Mut.  Ins.  Co.      365  a, 


V.  Hawkeye  Ins.  Co. 
Voss  v.  Conn.  Mut.  L.  Ins.  Co. 
Vvse  V.  Wakefield 


366 

479 

399  D 

202 


w. 


566 

188 
65 
70 


Waddington  v.  Insurance  Co. 
Wadhams  v.  Western  Ass.  Co. 

Wadsworth  v.  Davis 

Wager  v.  Providence  Ins.  Co. 


Wainer  v.  Milford  Ins.  Co. 
Wainewright  v.  Bland 

Wakefield  v.  Martin 
V.  Orient  Ins.  Co. 


567 

126, 

469  D 

555 

453, 

457  B 

96,  247 

109,  112,  181, 

188  A 

459  F 

221,369,387, 

502  a 

Wakeman  v.  Met'n  L.  Ins.  Co.     103  A 
Walcott  V.  Met'n  Ins.  Co.  325 

Waldeck   v.    Springfield  Fire   & 

Mar.  Ins.  Co.  415,  587  A 

Walden  v.  La.  Ins.  Co.  208 

Waldman  v.  North  British  &  M. 

Ins.  Co.  369 

Waldrom  v.  Waldrom  399  L 

Wales  V.  N.  Y.  Bowery  Fire  Ins. 

Co.  43  G 

Walker  v.  American  Central  Ins. 

Co.  "0  a 


TABLE    OF   CASES. 


[The  references  are  to  the  sections.] 


Section 

Walker  v.  Farmers'  Ins.  Co.         58,  64 

i\  Larkin  379 

V.  Lond.  &  Prov.  Ins.  Co.       407  A 

V.  Met.  Ins.  Co.  18,  23,  65 

V.  Northern  Ass.  Co.  2'J4  G, 

478,  667 

r.  Queen  Ins.  Co.  421  a 

Wall  r.  East  River  Mut.  Ins.  Co.    239, 

247 
r.  Equitable  Life  Ass.  Co.       66  A, 
360  G 
V.  Home  Ins.  Co.  134,  340 

V.  Howard  Ins.  Co.      159,  179,  239 
V.  Roberts  66  A 

Wallace  v.  German-American  Ins. 

Co.  493  A,  495 

V.  Ins.  Co.  31,  430,  5-52 

V.  Tellfair  124 

Wallincrford  v.  Home  Mut.  Fire 

&  Mar.  Ins.  Co.  51,  54 

Walls  v.  Bailey  179  E 

Walradt  v.  Phoenix  Ins.  Co.  274, 

291  A 
Walroth  v.  St.  Lawrence  Co.  Mut. 

Ins.  Co.  287 

Walsh  V.  ^tna  Life  Ins.  Co.   136,  356, 
370,  552 
V.  Fire  Association  82 

V.  Hartford  Fire  Ins.  Co.       249  H 
V.  Phila.  Fire  Ass.  285 

V.    Wash.   Mar.   &  Fire   Ins. 

Co.  465 

Walsh's  Admr.  v.  Vt.  Mut.  Fire 

Ins.  Co.  373  B,  465,  469 

Walter  v.  Northern  Ass.  Co.        287  A 

Walther  v.  Mut.  Life  Ins.  Co.  325 

Walton  V.  Agr.  Ins.  Co.  282  B 

V.  La.  St.  Mar.  &  Fire   Ins. 

Co.  365  a,  366 

Walworth  v.  Tubb  308 

Want  V.  Blunt  353,  857 

Warbasse  v.  Sussex   County  M. 

Ins.  Co.  449 

Ward  r.  Met'n  L.  Ins.  Co.  126,  156 

V.  National  F.  Ins.  Co.  465 

V.  Smith  40 

Warder  v.  Baker  450  F 

Wardie  v.  Townsend  559 

Ware  v.  MillviUe  Fire  Ins.  Co.  362 

Waring    v.  Indemnity    Fire    Ins. 

Co.  6,  424,  445,  448 

V.  Loder  82,  449 

Warner  v.  Middlesex  Mut.  Ass. 

Co.  289,  292 

V.  National  L.  Ins.  Co.  345  E 

I'.  Peoria   Mar.    &   Fire   Ins. 

Co.         129,  151,  370,  471,  472 

V.  U.  S.  Mut.  Ace.  Ass'n  325 

Warnock   v.  Davis      83,   102  A,    110, 

398 


Section 
Warren  v.  Davenport  Fire  Ins. 

Co.  76,  90 

V.  Ocean  Ins.  Co.  179  A 

Warwick  v.  Monmouth  368 

Washburn  v.  Artisans'  Ins.  Co.     416  a 
V.  Great  Western  Ins.  Co.  566 

V.  Ins.  Cos.  416  a 

V.  Miami,  &c.  Ins.  Co.         238,  415 
V.  Pa.  Ins.  Co.  416  a 

Washburn-Hall igan  Coffee  Co.  v. 
Merchants'  Brick  Mut.  F.  Ins. 
Co.  364,  469  C 

Washburn  Mill  Co.  v.  Phila.  Fire 

Ass'n  276  C 

Washington  County  Mut.  Ins.  Co. 

r.  Dawes  577 

V.  Hastings  577 

Washington  Ins.  Co.  v.  Davison      224, 
365  a,  372,  420 
V.  Hayes  366 

V.  Kelly  116,  267,  285,  287 

V.  Merchants'  &  Manuf.  Mut. 

Ins.  Co.  237,  239 

V.  Wilson  323,  583 

Washington    Life     Ins.     Co.    v. 

Haney  169,  195,  214 

V.  Menefee  151,  360 

V.  Schaible  175 

Washington  Mills  Emery  Manuf. 
Co.  V.  Comm.  Fire  Ins. 
Co.  276  B,  423  A 

V.  Weymouth  Ins.  Co.  285 

Washington  Mut.  Fire  Ins.  Co.  v. 

St.  Mary's  Seminary  445 

Washington  Mutual  Ins.  Co.  v. 
Merch.  &  Manuf.  Mut.  Ins.  Co.    237, 

239 
Washoe  Tool  Manuf.  Co.  v.  Hi- 

bernia  Fire  Ins.  Co.  360  A,  501 

Wason  V.  Colburn  390,  445 

Wass  V.  Maine  Mut.  Mar.  Ins.  Co.  126, 

174 
Watchorn  v.  Langford  420 

Waterbury  v.  Dakota  F.  &  M.  Ins. 

Co.  402 

Waters  v.  Alien  567 

V.  Assurance  Co.  95  A 

V.  Conn.  Mut.  Life  Ins.  Co.        307 

V.  Merchants'  Louisville  Ins. 

Co.  408,41.3,416 

V.  Monarch  Fire  &  Life  Ins. 

Co.  80, 424 

V.  Supreme  Conclave  Knights 

of  Damon  299 

Watertown  Fire  Ins.  Co.  v.  Grover  292, 

463 

V.  Grehan  429 

V.  Rust  67  L 

V.  Simons  161,  164,  287C,  577 

Watkina  v.  Durand  122  A 

Ixxxix 


TABLE   OF   CASES. 
[Tlie  references  are  to  the  sections.] 


Section 

Watson  V.  Bratton  ^ 

I..  Mainwariny;  295,  296  oOl 

Watts  V.  Atlantic,  &c.  Ins.  Co.       ci44  a 

Way   V.  Abington   Mut.  F.  Ins.     ^^^ 

Co.  .." 

Wavman  v.  Torreyson  ^^ 

Waynesboro'    Fire    Ins.    Co.   v. 

Conover  4°^ 

r.  Creaton  423  A 

Weakley  v.  Northwestern  Ben.  & 

Mut.  Aid  Ass.  562 

Weaver  t;.  Ward  309,310 

Webb  V.  Mut.  Fire  Ins.  Co.         356  A, 

560  A 

V.  Nat.  Fire  Ins.  Co.  420 

V.  Prot.  Ins.  Co.  404 

v  R  W.  &  0.  R.  R.  Co.    408,  454, 

459 

Webber  v.  E.  R.  R.  Co.  580 

Weber  v.  Morris  &  Essex  R.  R.      455, 

457 

Webster  v.  British,  &c.  Ins.  Co.        428 

V.  Buffalo  Ins.  Co.  591  A 

r.  Dwelling- House  Ins.  Co.        81, 

287  B 

V.  Mut.  Rel.  Soc.  298 

I'.  Bhceni.x  Ins.  Co.  372 

Weed  V.  Hamburg-Bremen  F.  Ins. 

Co.  43  D,  111 

V.  L.  &  L.  Fire  Ins.  Co.  126,  133  E, 

506 

V.  Mut.  Ben.  Life  Ins.  Co.  325 

Weeks  v.  Hall  400 

Weeras   v.   Standard   Life    Ass. 

Co.  145  A 

Wehle  V.  U.  S.  Mut.  Ace.  Ass'n  517  A 
Wehrlin  l\  Phenix  Ins.  Co.  356 

Weil  I'.  New  York  L.  Ins.  Co.  181 

Weimer   y.  Economic  L.  Ass'n      187, 

298 
Weinaugh  v.  Provincial  Ins.  Co.  368 
Weinfeld  v.  Mutual    Reserve  L. 

Ass'n  55  A 

Weingartner  ?;.  Charter  Oak  Life 

Ins.  Co.  63 

Weir  1-.  Northern   Counties,  &c. 

Ins.  Co.  475 

Weisenberger  i'.    Harmony  Ins. 

Co.  420 

Weisert  v.  Muehl  399  L 

Welland  Canal  v.  Hathaway  502 

Wellcome  v.  People's   Eq.   Mut. 

Fire  Ins.  Co.  465 

Welles  V.  Boston  Ins.  Co.  427 

V.  Yates  566 

Wellington  Mut.  Ins.  Co.  v.  Frey  180  a 

Wells  r.  Archer  291 

V.  New  England  Mut.  L.  Ins. 

Co.  430 

V.  Phila.  Ins.  Co.  13,  93  A 

XC 


Section 

Welsh  V.  Continental  Ins.  Co.  54  C 

V.  Des  Moines  Ins.  Co.  467 

V.  London  Ass.  Corp.  448 

Welts  V.  Conn.  Mut.  Life  Ins.  Co.     332 

Wemyss  v.  Med.  Invalid  &  Gen. 

Life  Ins.  Soc.  51,  190 

Wendt  c.  la.  Legion  of  Honor     399  O 
Wentworth  i^.  Tubb  308 

Wenzel  v.  Com.  Ins.  Co.  252 

West    V.    British   America  Ass. 

Co.  477 

V.  Citizens'  Ins.  Co.  279 

V.  Norwich  Union  F.  Ins.  Co.     369 
V.  Old  Colony  Ins.  Co.  401  a 

V.  Reid  395 

West  Branch  Ins.  Co.  v.  Helfen- 

stein      265,  272,  886,  462,  463 
V.  ^mith  559 

West  Branch  Lumberman's  Ex- 
change V.  American  Central 
Ins.  Co.  177,  364 

Westchester  F.  Ins.  Co.  v.  Cover- 
dale  469  C,  577 
V.  Dodge  449,  478,  488 
V.  Earle  23,  24,  65,  502,  508 
V.  Foster  239,  446 
V.  McAdoo  401  a 
V.  Wagner  287  B,  294  E 
V.  Weaver  285,  287 
West  Coast  Lumber  Co.  v.  State 

Inv.  &  Lis.  Co.  273  A 

West  End  Hotel  &  Land  Co.  i'. 

American  F.  Ins.  Co.  67,  239 

Western  v.  Genesee  Mut.  Ins.  Co.     49, 

66,  400,  420  B,  563 

Western  Ass.  Co.  v.  Atvvell  368 

V.  Eecker  494 

V.  Doull  369 

r.  Hall  492 

V.  McAlpin  21 

V.  McCarty  294  E,  379,  469  D 

V.  McG  lathery  263  A 

V.  McPike  249  B 

V.  Mohlman  Co.       -  412,  420 

V.  Phelps  368 

V.  Ray  30,  294  E,  589 

V.  Rector  144  A,  239 

V.  Williams  401  a 

Western  &  Atlantic  Pipe   Lines 

r.  Home  Ins.  Co.  72,  287  B,  404 

Western   Commercial   Travelers' 

Ass'n  V.  Smith  517  A 

Western  Farmers'  Mut.  Ins.  Co. 

V.  Miller  225,  244,  410 

Western   Home  Ins.  Co.  v.  Rich- 
ardson 340,  430,  469  C 
Western  Ins.  Co.  v.  Cropper  175 
V.  O'Neill                                     407 
V.  Putnam                                  496  B 
V.  Scheidle                                  502 


TABLE  OF  CASES. 


[The  references  are  to  the  sections.] 


Section 
Western  Mass.  Ins.  Co.  r.  Duffey  23,  25 
V.  Riker  269 

Westfall  V.   Hudson    River   Fire 

Ins.  Co.  156,  162,  175,  234 

Westfield  Cigar  Co.  i\  Ins.  Co.  of 

North  America  125,  257,  261 

West   Jersey  Title  &,   G.  Co.   v. 

Barber  456 

West  of  England  F.  Ins.   Co.  .;. 

Isaacs  453 

Westlake    v.   St.    Lawrence,    &c. 

Ins.  Co.  369,  387,  464,  468,  505 

Weston  V.  Ernes  579  B 

Westover  v.  vEtna  Life  Ins.  Co.        296 
West  Rockingliam,  &c.  Ins.  Co.  v. 

Siieets  290,  469 

Westropp  V.  Bruce  214,  305 

Wetherell  v.  City  Fire  Ins.  Co.        233 
V.  Maine  Ins.  Co.  133  A,  502 

Wetmore  i'.  Mut.,  &c.  Ins.  Ass.         349 
Wheaton  v.  Nortii  British  &  Mer. 

Ins.  Co.     144  A,  373  A,  373  B,  478  A 
Wheeler   v.   American,   &.c.    Ins. 

Co.  239 

V.  Conn.  Life  Ins.  Co.     335,  345  a, 

352,  465 

I'.  Factory  Ins.  Co.  449 

V.  Ins.  Co.  241,  452  C 

V.  Real  Estate  Title  Ins.  Co.  291  A 

V.  Traders'  Ins.  Co.  239  A 

V.  Watertown  Fire  Ins.  Co.       126. 

348,  368 

Wheeling  Ins.  Co.  v.  Morrison  379 

Wheelton  v.  Hardisty        123,  156,  159, 

161.213,358 

Whipple  V.  North  Brit.,  &c.  Ins. 

Co.  440 

Whitaker  v.  Farmers'  Union  Ins. 

Co.  62,  400 

Whitbread,  Ex  parte  291 

Whitcomb  v.  Phoenix  Ins.  Co.     66,  126 

White  V.  Agr.  Mut.  Ins.  Co.  289 

V.  British   Empire  Mut.  Life 

Ass.  Co.  312,324 

V.  Brown  6,  456 

V.  Com.  Mut.  Life  Ins.  Co.      180  a 
V.  Equitable  Nuptial  Benefit 

Union  75  B,  547  B 

V.  Germania  Fire  Ins.  Co.  511 

V.  Havens  548 

V.  Hudson  Riv.  Ins.  Co.        83,  285, 

424 
V.  Ins.  Co.  of  New  York  67  G,  67  H 
V.  Madison  80,  124 

V.  Mann  465 

V.  Mut.   Fire   Ins    Co.      241,  258, 

420 
V.  Phoenix  Ins.  Co.  247 

V.  Provident  S.  L.  Ass.  Soci- 
ety 156,  298,  303 


Section 

White  V.  Republic  Fire  Ins.  Co.       404 
V.  Ross  560 

V.  Royal  Ins.  Co.  239  A 

V.  Smith  459  D 

V.  Walters  172  A 

V.  Weston  Ass.  Co.  245 

Whitehead  v.  N.  Y.  Life  Ins.  Co. 

399  P,  399  Q 

V.  Price  253 

Whitehill  v.  Shickle  25 

Whiteliouse  v.  Travelers'  Ins.  Co.    516 

Whitehurst  v.  Fayetteville  Mut. 

Ins.  Co.  404 

V.  North  Carolina  Mut.  Ins. 

Co.  462 

Whiteman   Bros.  v.  Amer.   Cent. 

Ins.  Co.  69  B 

Whiting  V.  Mass.  Mut.  Life  Ins. 

Co.  55,  340,  3.59 

V.  Miss.  Valley  Mut.  Ins.  Co.     359 

V.  Sun  Mut.  Ins.  Co.  115 

Whitlaw  V.  Phoenix  Ins.  Co.  250 

Whitley  v.  Piedmont,  &c.  Ins.  Co.  190, 

340 
Whitmarsh  v.  Charter  Oak  Fire 

Ins.  Co.  238,  242 

V.  Conway  Fire  Ins.  Co.     179,  233, 

238,  239,  420 

Whitmore  v.  Supreme  Lodge  75  B 

Whitney  v.  Am.  Ins.  Co.         12,  294  E, 

422  A 

V.    Black    River    Ins.    Co.      248, 

249  A 

V.  Haven  400 

V.  Ind.  Mut.  Ins.  Co.  7 

Whiton  V.  Albany,  &c.  Ins.  Co.         156 

V.  Old  Colony  Ins.  Co.  420  A 

Whitridge  v.  Barry  391 

Whittaker  v.  Farmers'  Union  Fire 

Ins.  Co.  135,  565 

Whitten  v.   New   England   Live- 
stock Ins.  Co.  465 
Whittle   V.    Farmville    Ins.,    &c. 

Co.  469 

Whitwell  V.  Putnam  Fire  Ins.  Co.    101, 
277,  .366 
Wholley  v.  Western  Ass.  Co.  138 

Wiberg  v.  Minnesota  S.  R.  Ass'n     305 
Wickiug  V.  Citizens'  Mut.  Fire  Ins. 

Co.  492 

Wicksteed  c.  Munro  399  N 

Wiestling  v.  Warthin  66  A 

Wiggin  V.  Mercantile  Ins.  Co.       420  A 
V.  Suffolk  Ins.  Co.  13,  434 

Wightman  v.  West.  Mut.  &  Fire 

Ins.  Co.  465,  583 

Wilber  v.  Torgerson  594  a 

Wilbur  V.   Bowditch    Mut.   Fire 

Ins.  Co.  287,  291,  ."^wS 

V.  N.  E.  Mut.  Fire  Ins.  Co.        376 

xci 


TABLE   OF  CASES. 
The  references  are  to  the  sections.] 


Section 
Wilburn  r.  Wilburn  399  D,  399  L 

Wilcox  r.  Continental  Ins.  Co.         ji^_ 
Wildcy  Casualty  Co.  v.  St'epP'^rd    fbo 
r  Farm.  Mut.  Fire  Ins.  Co.  401  B 
Wilkins    r.   Germania  Fire  Ins. 

r.  Mut.  Reserve  Fire  Life  Ass. 

144  r 

t;.  State  Ins.  Co.  126 

t,.  Tobacco  Ins.  Co.      67,101,1-6 
Wilkinson   v.   Connecticut   Mut. 

Life  Ins.  Co.  1«7 

r.  Coverdale  1^4 

r  Un.  Mut.  Ins.  Co.  300 

WiUcuts  V.  N.  W.  Mut.  Life  Ins 

e^o  24  A,  345  C,  360  D 

Wilietts  r.  Sun  Mut.  Co.  452  F 

Willev  f.  Uobinson  25 

Willia'nis  v.  Albany  City  Ins.  Co.  341  A 

V.  Babcock  562 

0.  Buffalo  German  Ins.  Co.         284 

V.  Canada  Farmer's  Mut.  Ins. 

Co.  64 

V.  Canada  Fire  Mut.  Ins.  Co.    143, 
502 
V.  Cheney  577,  584,  590 

V.  Columbian  Mut.  Ins.  Co.  491 
V.  Corson  391 

V.  Crescent  Ins.  Co.  3()5 

V.  Fireman's  Fund  Ins.  Co.  242 
V.  German,  &c.  Ins.  Co.  5B2 

V.  Hartford  Fire  Ins.  Co.  421  a 
V.  Mechanics',  &c.  Ins.  Co.  242 
V.  New  Ene.  Mut.  Fire  Ins. 

Co.  241,  408,  425 

r.  New  Orleans  Ins.  Ass.  144  A 
V.  Niagara  Ins.  Co.  148,  466 

V.  North  German  Ins.  Co.     249  U, 
566  A 
V.  Ocean  Ins.  Co  595 

V.  People's  Ins.  Co.    218,  221,  230, 
242 
i;.  Pew  133 

V.  Phoenix  Ins.  Co.  373,  443 

V.  Queen's  Ins.  Co.  466 

V.  Roger  Williams  Ins.  Co.  83,  237 
V.  Smith  23 

i;.  United  Reserve  Fund  As- 
sociates 594 
V.  U.  S.  Mut.  Ace.  Ass'n  325 
V.  Vermont  Mut.   Ins.    Co.      478, 
483 
V.  Warbasse  365 
I'.  Washington  Life  Ins.  Co.     106, 
341 
Williams'  Appeal                           391  A 
Williamsburg  City  Fire  Ins.  Co. 

V.  Cary  401  n,  469,  488,  508 

Williamson  v.  Iland-in-Hand  Mut. 
Fire  lus.  Co.  423 

xcii 


Section 

Williamson  v.  Michigan  F.  &  M. 

Ins.  Co.  3/9,  449 

i'.  Orient  Ins.  Co.  269,  287  B 

Willis  V.  Germania,  &c.  Ins.  Co.       2-39 

V.  People  §20 

V.  Poole  295 

Willoughby  v.  St.  Paul  German 

Ins.  Co.  452  F 

Willow   Grove  Creamery  Co.  v. 

Planters'  Mut.  Ins.  Co.  402 

Wills  V.  Wells  399  B 

Willyams    v.   Scottish    Widows 

Fund  L.  A.  Society  465 

Wilmaser    v.    Cont.     Life    Ins. 

Co  399  L 

Wilmot  V.  Charter  Oak  Ins.  Co.     344  a 

Wilson  v.  ^tna  Ins.  Co.  478,  483 

r.  Citizens' Ins.  Co.  83  a 

V  C-inway  Mut.  Fire  Ins.  Co.   141, 
145,  162,164,  175,  185,566 

V.  Genesee  Mut.  Ins.  Co.   129,  279, 

384 

V.  Hampden  Fire  Ins.  Co.  166, 

175,  187 

V.  Herkimer   Co.   Mut.   Ins. 

Co.  228,  243,  258,  360  B 

V  Hill  2,  6,  72,  264,  365,  378, 
386,  391 

V.  Janes  90 

r.  Lawrence  399  Q 

V.  Life  Association  214 

V.  Minn.  Farmers'  Mut.  Ins. 

Ass.  133  A 

V.  Montgomery    County    M. 

F.  Ins.  Co.  368 

V.  National   L.   Ins.   Co.      144  D, 
566 
V.  Queen  Ins.  Co.  365 

V.  Standard  Ins.  Co.  160 

V.  State  Fire  Ins.  Co.  478 

V.  Trumbull    Co.   Mut.    Ins. 

Co.  553,  555 

Winans   v.  Allemaine  Fire  Ins. 

Co.  143 

Winchell  v.  John  Hancock  Life 

Ins.  Co.  344  a,  566  C 

Winchester  v.  Stebbins  391 

Windus  v.  Lord  Tredegar  341 

Wineland  i'.  Security  Ins.  Co.  289 

Wing  V.  Harvey  136,  339,  362,  502 

Winne  v.  Niagara  Fire  Ins.  Co.     43  B, 

138  B 
Winnesheik  r.  Holzgrafe  43  F,  54  A 
Winnesheik  Ins.  Co.  v.  Schueller    468, 

476 
Winsor  v.  Odd  Fellows'  Ass.  451 

Winspear  v.  Accident  Ins.  Co.         516, 

518  A 
Winterhalter  v.  Workmen's  Guar- 
antee Fund  Ass.  399  J 


TABLE  OF  CASES. 


[The  references  are  to  the  sections.] 


Section 

Witherell  v.  Maine  Ins.  Co.     70  a,  156, 
404,  501 
AVitt  V.  Amis  395 

Wittingham  r.  Thornborough  591 

Wolcott  V.  Eagle  Ins.  Co.  422  A 

Wolf  V.   District   Grand   Lodge     305, 

479 

V.  Dwelling-House  Ins.  Co.        137 

Wolfe  V.  Homer  350 

V.  Howard  Ins.  Co.  424 

V.  Security  Fire  Ins.  Co.     278,  381 

Wolff  V.  Conn.,  &c.  Ins.  Co.  325 

■y.  Horncastle  23  D 

Wood  V.  American  F^ire  Ins.  Co. 

137  A,  151,  274,  497 
V.  Dwarris  356 

V.  Firemen's  Fire  Ins.  Co.  373 

V.  Hartford  Fire  Ins.  Co.   231,  257 
V.  Ins.  Co.  493 

V.  Mass.  Mut.  Ace.  Ass'n         515  a 
V.  North  Western  Ins.  Co.        239, 

456 
V.  Phoenix  Mut.  Life  Ins.  Co. 

of  Hartford  395 

V.  Poughkeepsie  Ins.  Co.  360 

V.  Rutland   &  Addison    Mut. 

Fire  Ins.  Co.  24,  101,  281, 

424,  448 
V.  Standard  Mut.  Live-Stock 

Ins.  Co.  594 

Woodbury  Savings  Bank  v.  Char- 
ter Oak  Ins.  Co.       27,  130,  144,  366, 
478,  487,  499,  566 
Wooddy  V.  Old  Dominion  Ins.  Co.    59, 
64,  134,  283 
Woodfin  V.  The   Asheville   Mut. 

Ins.  Co.  343,  465,  474 

Woodruff  V.  Columbus  Ins.  Co.    420  B 
V.  Imperial  Ins.  Co.  247,  431 

V.  Sussex  County  Mutual  Fire 

Ins.  Co.  82,  285,  287,  424, 

457,  565,  584,  591 

Woods  V.  Atlantic  Mut.  Ins.  Co.       261 

V.  Edwards  350 

V.  N.  W.  Ins.  Co.  232 

V.  Wilder  39 

Woodward  v.  Republic  Fire  Ins. 

Co.  253  B 

Wooliver  v.  Boylston  Ins.  Co.       294  E 
Woracher  v.  Denmark  M.  H.  F. 

Ins.  Co.  189 

Worcester  v.  Worcester  Mutual 

Fire  Ins.  Co.  255 

Worcester  Bank  v.  Hartford  Fire 

Ins.  Co.  369 

Worden  i-.  Guardian,  &c.  Ins.  Co.    352. 

353 
Work  V.  Merch.  &  Farmers'  Mut. 

Fire  Ins.  Co.  448 

Workman  v.  Ins.  Co.  420 


Section 
Works  V.  Farmers'  Mut.  Fire  Ins. 

Co.  469  B,  504 

World    Mut.    Life    Ins.    Co.   v. 

Scliultz  166,  186,  187,  295,  297 

Worley  v.  State  Ins.  Co.  247,  248 

Worsley  v.  Wood  29,  466 

Worswick  v.  Canada,  &c.  Ins.  Co.  163, 

250 

Worthington  v.  Bearse  101,  268 

V.  Charter  Oak  Ins.  Co.  344  c, 

350  a 

V.  Curtis  390 

Wray  v.  Man.  Prov.  Ass.  Co.  212,  305 

Wright  V.  Eq.  Life  Ass.  Co.  156 

V.  Hartford  Ins.  Co.  466 

V.  London  Life  Ass.  Co.  17 

V.  Mut.  Benefit  Ass'n     268  A,  478 

V.  Sun  Mut.  Life  Ins.  Co.      17,  27, 

516,  580 

V.  Susquehanna  Mut.  F.  Ins. 

Co.  493  A 

V.  Vermont  L.  Ins.  Co.        156,  306 

V.  Ward  493 

Wright  &  Pole,  In  re  423 

Wustum  V.  City  Fire  Ins.  Co.  248 

Wyclie  V.  Greene  566 

Wyld  V.  Liverpool,  &c.  Ins.  Co.         59, 

140,  148 

Wylde  V.  Union  Mar.  Ins.  Co.       566  A 

Wyman  v.  Bank  23  D 

V.  People's  Eq.  Ins.  Co.     287,  290, 

461 
V.  Phoenix  Mut.  Life  Ins.  Co. 

356  A,  362 
V.  Prosser  447  B 

V.  Wyman  452  A 

Wynkoop   v.   Niagara  Fire   Ins. 

Co.  433  A 

Wynne  v.  Liverpool,  &c.  Ins.  Co.    250, 

424 
Wytheville  Ins.  Co.  v.  Stultz  230 


X. 

Xenos  V.  Wickham 


44,60 


Y. 


Yancey  v.  ^tna  L.  Ins.  Co.         531  A 
Yard  v.  Pacific,  &c.  Ins.  Co.  552 

Yates  V.  Whyte  453,  454,  455 

Yeager,  In  re  391 

Yeaton  v.  Yvye  26 

Yeomans  v.  Girard  Fire  Ins.  Co.      495 
Yonge    V.    Equitable    Life    Ins. 

Co.  360  B 

Yonkers  Ins.  Co.  v.  Hoff  Ins.  Co.       11 
Yore  V.  Booth  399  D 


TABLE   OF   CASES. 
[The  references  are  to  the  sections.] 


Section 
York,  &c.  Ins.  Co.  v.  Bowden  559 

York   Co.   Miit.  Fire  Ins.   Co.  v. 

Knight  562 

V.  Turner  555 

Yost  V.  American  Ins.  Co.  341  a 

V.  McKee  287  B,  492 

Young  V.  Eagle  Fire  Ins.  Co.  264 

i:  Hartford  Fire  Ins.  Co.  151 

V.  Madison  Co.  Mut.  Ins.  Co.  225 
V.  Mut.  Life  Ins.  Co.  of  N.  Y.  50o 
V.  Tacific  Mut.  Ins.  Co.  421  a 

V.  Travelers'  Ins.  Co.  144  A,  523 
V.  Turing  30 

V.  Washington  Ins.  Co.  408 

xciv 


Section 


Zalesky  r.  Iowa  State  Ins.  Co.        430 

Zallee  v.  Conn.  Mut.  Life  Ins.  Co.  566 

V.  Laclede  Mut.  Fire  &  Mar. 

Ins.  Co.  496  B 

Zielke  v.  Lond.  Ass.  Co.  469  B 

j  Zigler  r.  Phoenix  Ins.  Co.  70  B 

!  Zimmerman   v.   Dwelling-House 

Ins.  Co.  137 

I  V.  Farmers'  Ins.  Co.  448 

I  V.  Home  Ins.  Co.  372  D 

I  Zinck  V.  Phoenix  Ins.  Co.  365  C 

I  Zummers  v.  U.  S.  Ins.  Ann.  Co.       218 


INSURANCE: 

FIRE,  LIFE,  ACCIDENT,  ETC. 


CHAPTER   I. 

OF  THE  NATURE  OF  THE  CONTRACT. 


Analysis. 


Reinsurance.  —  Double  Insurance. 


1.     The  Contract  Generally. 


§  1.  Definition.     A  promise  upon  consideration  to  pay  a  contingent  loss 

on  the  implied  condition  that  the  consideration  shall  be  returned 
if  the  risk  never  attaches  (see  §  4). 
According  to  the  subject-matter  and  the  peril  insured  against  it  is 
called  iire,  life,  accident,  marine,  &c.,  insurance. 

§§  2-3.  It  is  essentially  a  contract  for  indemnity,  not  profit  (see  also  §§11 

7,  8).  ' 

Its  object  is  to  relieve  individuals  from  the  crushing  weight  of  losses 
that  come  upon  them  without  their  own  fault  by  distributing  the 
burden  over  the  community.  It  is  governed  by  the  same  general 
principles  as  other  contracts,  but  has  special  characteristics,  and 
must  be  interpreted  in  the  light  of  its  purposes  and  history. 

§  4.  If  the  subject-matter  is  not  put  at  risk,  the  insurer  cannot,  in  the 

absence  of  fraud,  retain  the  premium.     Italian  writers  contra. 

§  5.  It  is  an  aleatory  contract,  an  exchange  of  risks. 

§  6.  It  is  personal  and  does  not  run  with  the  title  to  the  subject-matter, 

except  by  express  provision  ;  see  §  72. 

§§  7-8.  An  effort  has  been  made  to  show  that  life-insurance  does  not  involve 

the  principle  of  indemnity,  but  in  truth  the  purpose  always  is 
indemnity  for  the  loss  of  a  valuable  interest.  It  is  this  which 
distinguishes  insurance  from  a  mere  wager  (see  §§  33,  74).  What 
the  interest  shall  be,  provided  it  is  valuable,  and  whether  the 
amount  of  its  value  shall  be  estimated  after  loss,  or  beforehand,  as 
in  life  policies,  and  in  valued  policies  fire  and  marine,  are  merely 
incidental  questions. 
VOL.  I.  —  1  -t 


§  1]  insurance:  fire,  life,  accident,  etc.  [ch.  I. 

2.    Reinsurance. 
§§  9-12  C.     Reinsurance  is  the  contract  one  insurer  makes  with  another  to  protect 

the  first  from  a  risk  he  has  ah-eady  assumed  (see  also  §  98). 
The  contract  between  reinsurer  and  reinsured  is  in  general  subject  to 

like  rights  and  liabilities  as  that  between  reinsured  and  the  person 

originally  insured.     It  is  a  contract  for  indenmity,  no  more.     The 

insolvency  of  the  reinsured  does  not   affect   the   liability  of  the 

reinsurer  (§  11  d  seq.). 
The  extent  of  the  reinsurer's  liability  is  determined,  subject  of  course 

to  the  express  terms  of  the  agreement,  by  the  amount  the  insurer 

has  paid,  if  he  has  settled  with  the  assured,  and  by  what  the 

insurer  is  liable  to  pay  the  assured  where  a  final  settlement  has 

not  been  reached,  and  without  any  reference  to  the  ability  of  the 

original  insurer  to  pay  in  full  (§  11  A). 
Settlement  with  the    assured  in   violation  of  promise  to  reinsurer 

releases  the  latter  (§  12  A). 
The  party  first  insured  acquires  rn.  rights  against  the  reinsurer,  nor 

any  special  claim  on  the  money  paid  the  reinsured  unless  so  agreed 

(see  §  12,  note). 
The  contract  is  not  within  the  statute  of  frauds  (§  12  A). 
Conditions  of  the  original  policy  do  not  always  afi'ect  the  reinsurance, 

but  the  reinsurer  is  bound  by  the  insurer's  waiver, 
waiver  of  the  insurer  or  his  assent  to  an  assignment  (§  12  B). 
Reinsurance  of  risks  in  New  York  does  not  include  policies  issued  in 

New  York  on  property  elsewhere  (§  12  C). 
Parol  is  admissible  to  show  that  a  polic}'  is  one   of  reinsurance 

(§  12  D). 
The  beginning  of  the  risk  is  the  same  as  that  of  the  original  one 

unless  ot'nerwise  expressed  (§  12  D). 
Usage,  costs  of  suit  against  reinsured,  concealment,  representation, 

notice,  and  proof  of  loss,  reinsurance  of  all  risks,  surplus  fund,  &c., 

see  Index. 
In  Massachusetts  the  freedom  of  reinsurance  is  limited.     Pub.  Stats. 

703,  716. 

3.     Double  Insurance. 
§  13.  Double  insurance  is  more  that  one  insurance  of  the  same  interest. 

The  insured  can   recover  no  more   than   his   loss.     Proportional 
liability  of  the  insurers  and  contribution  among  them. 

§  1.  Definition.  —  Insurance  is  a  contract  whereby  one,  for 
a  consideration,  undertakes  to  compensate  another  if  he 
sliall  suffer  loss.  Such,  in  its  most  general  terms,  is  the 
definition  of  the  contract  which  is  to  constitute  the  subject 
of  the  following  chapters.  It  is  substantially  the  definition 
given  long  ago  by  Roccus,  and  is  recommended  alike  by  its 
brevity  and  its  comprehensiveness,  —  qualities  upon  which 
subsequent  writers  have  scarcely  been  able  to  improve. 
2 


CH.  I.] 


OF   THE   NATURE    OF   THE   CONTRACT. 


t§i 


^^  Assecuratio^^^  says  that  early  writer,  '^est  contractus  quo  quis 
alienee  rei  periculum  in  se  suscepit,  ohligando  se,  sub  certo 
pretio,  ad  earn  compensandam,  si  ilia  perierit.^' ^  Neither  the 
times  and  amounts  of  payments  by  the  insured,  nor  the 
modes  of  estimating  or  securing  the  payment  of  the  sum  to 
be  paid  by  the  insurer,  affect  the  question  whether  the  agree- 
ment between  them  is  a  contract  of  insurance.  All  that  is 
requisite  to  constitute  such  a  contract  is  the  payment  of  con- 
sideration by  the  one,  and  the  promise  of  the  other  to  pay 
the  amount  of  loss  agreed  upon  in  the  contract,  or  to  be  de- 
termined upon  investigation,  to  the  person  entitled  to  claim 
it,  upon  the  happening  of  the  contingency  contemplated  in 
the  contract.^  (a)  • 

^  De  Assecur.  not.  1.  See  also  Bynkershoeck's  Laws  of  War,  Du  Ponceau's 
ed.  164.  "  Insurance  is  a  contract  by  which  the  one  party,  in  consideration  of 
a  price  paid  to  him,  adequate  to  the  risk,  becomes  security  to  the  other,  that  he 
shall  not  suffer  loss,  prejudice,  or  damage  by  the  happening  of  the  perils  specified 
to  certain  things  which  may  be  exposed  to  them."  Per  Mr.  Justice  Lawrence  in 
Lucena  v.  Craufurd,  2  Bos.  &  Pul.  New  Rep.  269,  300,  after  citing  the  dehnitions 
of  Valin,  Roccus,  and  others. 

2  Commonwealth  v.  Wetherbee,  105  Mass.  149.     See  also  post,  §§  6,  550  a. 


(a)  The  Massachusetts  statute  of  1897, 
ch.  66,  §  1,  defined  an  insurance  con- 
tract to  be  "an  agreement  by  which  one 
party  for  a  consideration  promises  to 
pay  money  or  its  equivalent  or  to  do 
some  act  of  value  to  the  assured  upon 
the  destruction,  loss  or  injury  of  some- 
thing in  which  the  other  party  has  an 
interest."  This  statutory  definition  is 
probably  nothing  more  than  a  declara- 
tion of  the  common -law  definition  of 
insurance,  as  given  by  Mr.  Justice  Gra}'^, 
in  Commonwealth  v.  Wetherbee,  105 
Mass.  160.  See  Claflin  v.  U.  S.  Credit 
System  Co.,  165  Mass.  501.  On  May 
11, 1898,  the  Attorney-General  of  Massa- 
chusetts, in  an  opinion  addressed  to  the 
Insurance  Commissioner,  ruled  that  the 
essential  element  of  insurance  is  that 
the  insured  receives  indemnity  from  loss 
hy  reason  of  the  happening  of  events 
without  his  control  or  the  control  of 
the  insurer;  and  that,  if  a  physician 
contracts   for  his  services   for  a  fixed 


time  for  a  fixed  price,  it  is  not  insurance. 
Attorney-General's  Report  (1898),  p.  28. 
The  guaranteeing  of  a  realty  revenue 
from  farming  lands  is  insurance,  such  a 
revenue  being  subject  to  many  contin- 
gencies, as  winds,  hail,  frost,  drought, 
ravages  of  insects,  etc.  Re  Hogan  (N. 
D.),  78  N.  W.  1051.  So  an  agreement 
by  which  a  corporation,  in  considera- 
tion of  a  sum  paid,  is  to  purchase  at  a 
fixed  price  the  accounts  which  during 
one  year  a  business  firm  shall  have 
against  ascertained  insolvent  debtors, 
or  judgment  creditors  against  whom 
execution  shall  be  returned  unsatisfied, 
was  a  contract  of  insurance  within  the 
Massachusetts  act  of  1887,  ch.  214, 
which,  by  limiting  insurance  to  what 
was  authorized  by  that  Act,  excluded 
credit  insurance.  Claflin  v.  U.  S.  Credit 
System  Co.,  165  Mass.  501;  Rosen- 
baum  V.  U.  S.  Credit  System  Co.  (N.  J. 
L.),  44  Atl.  986.  And,  in  general,  a 
contract  to  indemnify,  wholly  or  par- 

3 


§  2]  INSURANCE  :   FIEE,   LIFE,   ACCIDENT,    ETC.  [CH.  I. 

§  2.  Contract  of  Indemnity .  — It  had  its  origin  in  the  ne- 
cessities of  commerce ;  ^  it  has  kept  pace  with  its  progress, 
expanded  to  meet  its  rising  wants  and  to  cover  its  ever- 
widening  fields;  and,  under  the  guidance  of  the  spirit  of 
modern  enterprise  tempered  hy  a  prudent  forecast,  it  has 
from  time  to  time,  with  wonderful  facility,  adapted  itself  to 
the  new  interests  of  an  advancing  civilization.  It  is  appli- 
cable to  every  form  of  possible  loss.  Wherever  danger  is 
apprehended  or  protection  required,  it  holds  out  its  foster- 
ing hand,  and  promises  indemnity. ^  This  principle  under- 
lies the  contract,  and  it  can  never,  without  violence  to  its 
essence  and  spirit,  be  made  by  the  assured  a  source  of  profit, 
its  sole  purpose  being  to  guaranty  against  loss  or  damage.^ 
"Though  based  upon  self-interest,"  says  De  Morgan,^  "yet 
it  is  the  most  enlightened  and  benevolent  form  which  the 
projects  of  self-interest  ever  took.  It  is,  in  fact,  in  a  limited 
sense  and  a  practicable  method,  the  agreement  of  a  commu- 
nity to  consider  the  goods  of  its  individual  members  as  com- 
mon. It  is  an  agreement  that  those  whose  fortune  it  shall 
be  to  have  more  than  average  success  shall  resign  the  over- 
plus in  favor  of  those  who  have  less.     And  though  it  has  as 

1  Insurance  Co.  v.  Dunham,  11  Wall.  (U.  S.)  1. 

2  [Insurance  contracts  are  fundamentally  for  indemnity,  and  will  be  liberally 
construed  to  that  end.     Insurance  Co.  v.  Hughes,  10  Lea  (Tenn.),  461.] 

3  Wilson  V.  Hill,  3  Met.  (Mass.)  66  ;  Kulen  Kemp  v.  Vigne,  1  T.  R.  304,  per 
Buller,  J.  ;  Franklin  Fire  Ins.  Co.  v.  Hamill,  6  Gill  (Md.)  87  ;  post,  §§  7,  116. 
L'assurance,  nous  I'avons  dit,  a  pour  objet  de  reparer  une  perte  soufferte  par 
I'assure,  jamais  de  lui  procurer  un  benefice.  Alauzet,  Traite  General  des  Assu- 
rances, 1  par.  108.  II  est  de  I'essence  du  contrat  d'assurance  de  ne  garantir  que 
les  pertes  souffertes  et  les  depenses  faites  ;  et,  sauf  conventions  contraires,  il  est 
de  sa  nature  de  les  garantir  toutes.  Ibid.,  par.  112.  On  ne  "peut  fairs  assurer 
que  ce  qu'on  court  risque  de  perdre  ;  l'assurance  ne  doit  jamais  pouvoir  donner 
un  benefice  k  I'assure.  Ce  principe,  que  nous  avons  dejk  eu  I'occasion  d'etablir, 
doit  etre  maintenu  avec  le  plus  extreme  severite.  Ibid.,  par.  146.  Assecuratus 
non  quEcrit  lucrum,  sed  agit  ne  in  damno  sit.  Straccha,  de  Assecurationibus, 
pt.  20,  No.  4  ;  Pardessus,  Cours  de  Droit  Commercial,  1  §  589,  4. 

*  An  Essay  on  Probabilities,  and  on  their  application  to  Life  Contingencies  and 
Insurance  Offices.     Pref.  p.  xv. 

tially,  a  merchant  against  the  peril  of  citizens  of  the  same  state,  but  it  is  not 

loss  by  the  insurance  of  customers,  is  a  a  transaction  of  "commerce"  as  between 

valid   insurance  agreement.     Shakman  citizens   of  diff"erent   states.      State   v. 

V.  U.  S.  Credit  System  Co.,  92  Wis.  366.  Phipps,  50  Kansas,  609 
Insurance  is  a  "trade"  as  between 

4 


en.  I.] 


OF  THE  NATURP:  OF  THE  CONTRACT. 


[§3 


yet  been  applied  onh'  to  the  reparation  of  the  evils  arising 
from  storm,  fire,  premature  death,  disease,  and  old  age,  yet 
there  is  no  placing  a  limit  to  the  extensions  which  its  appli- 
cation might  receive,  if  the  public  were  fully  aware  of  its 
principles  and  of  the  safety  with  which  they  may  be  put  in 
practice."  {a) 

§  3.  Amongst  the  early  writers  the  peculiar  nature  of  this 
contract  has  been  the  subject  of  much  discussion.  The  Ital- 
ian doctors,  in  particular,  have  been  fruitful  in  dissertations 
better  adapted,  says  Boulay-Paty,^  to  fatigue  the  mind  than 
to  throw  light  upon  the  subject.  With  them  insurance  is 
now   a  nudum  pactum,   and  now   a   contractus  innominatus ; 

1  Cours  de  Droit  Commercial  et  Maritime,  tome  ii.  p.  3. 


{a)  The  range  of  insurance  has  been 
considerably  extended  in  recent  years, 
including  insurance,  e.  g.,  against  bur- 
glary and  house-breaking :  see  In  re 
George  and  Goldsmiths  and  General  Bur- 
glary Ins.  Ass'n,  Lim'd,  [1898]  2  Q  B. 
136  ;  of  credits,  and  against  losses  from 
the  insolvency  of  debtors  :  see  American 
Credit  Indemnity  Co.  v.  Carrol  ton  F.  M. 
Co.,  95  Fed.  Rep.  Ill  ;  Same  v.  Athens 
Woolen  Mills,-34  C.  C.  A.  161,  165,  and 
note  ;  Smith  u.  National  Credit  Ins.  Co., 
65  Jlinu.  283  ;  Goodman  v.  Mercantile 
Credit  Guarantee  Co.,  45  N.  Y.  S.  508  ; 
Shakman  v.  U.  S.  Credit  System  Co., 
92  Wis.  366 ;  by  benevolent  and  char- 
itable associations  making  contracts  by 
certificates  in  the  nature  of  life  insur- 
ance :  see,  e.  g.,  Golden  Star  Fraternity 
r.  Martin,  59  N.  J.  L.  207  ;  Brierly  v. 
Equitable  Aid  Union,  170  Mass.  218  ; 
Fisher  v.  Donovan,  57  Neb.  361  ;  of 
titles :  see  Stensgaard  v.  St.  Paul  Real 
Estate  Title  Ins.  Co.,  50  Minn.  429; 
Northwestern  Masonic  Aid  Ass'n  v. 
Jones,  154  Penn.  St.  99  ;  Lloyds'  pol- 
icies, by  which  suits  are  to  be  brought 
only  against  the  attorney  or  general 
managers  of  the  underwriters,  or  against 
certain  of  the  underwriters  :  see,  e.  g., 
Biggert  v.  Hicks,  42  N.  Y.  S.  236  ; 
Compton  V.  Beecher,  44  id.  887  ;  Stieg- 


litz  V.  Belding,  45  id.  670  ;  Ralli  v. 
White,  47  id.  197  ;  of  employers  against 
loss  from  damages  for  injuries  received 
by  their  employes :  see,  e.  g.,  Embler 
V.  Hartford  Steam  Boiler  Inspection 
&  Ins.  Co.,  158  N.  Y.  431  ;  People  v. 
American  Steam  Boiler  Ins.  Co. ,  41 
N.  Y.  S.  631 ;  Glens  Falls  Portland 
Cement  Co.  v.  Travellers'  Ins.  Co.,  162 
N.  Y.  399  ;  Anoka  Lumber  Co.  v.  Fidel- 
ity &  Casualty  Co.,  63  Minn.  286  ;  Chi- 
cago Sugar  Ref.  Co.  v.  American  S. 
B.  Co.,  48  Fed.  Rep.  198  ;  57  id.  294  ; 
Employers'  L.  Ass.  Co.  v.  Merrill,  155 
Mass.  404  ;  People's  Ice  Co.  v.  Em- 
ployers' L.  Ass.  Co.,  161  Mass.  122  ; 
of  fidelity  on  the  part  of  persons  hold- 
ing public  or  private  positions  of  trust 
and  of  employees :  see  People  v.  Rose, 
174  III.  310  ;  Fidelity  &  Casualty  Co.  v. 
Eickhoff,  53  Minn.  170;  infra,  ch.  30  ; 
of  growing  crops  from  injury  :  infra, 
§  79  ;  against  losses  by  common  carriers 
from  injuries  sustained  by  their  passen- 
gers :  see  Trenton  Passenger  Ry.  Co. 
V.  Guarantors'  Liability  Indemnity  Co., 
60  N.  J.  L.  246.  Such  new  forms  of 
insurance  are  properly  treated  as  within 
a  statute  of  general  insurance,  though 
the  new  forms  were  unknown  when 
such  statute  was  enacted.  People  u 
Rose,  174  111.  310,  315. 


§  3]  INSURANCE  :   FIllE,   LIFE,   ACCIDENT,   ETC.  [CH.  I. 

now  a  wager  and  now  a  stipulation,  a  security,  a  sale,  a  let- 
ting to  hire,  a  partnership,  a  mandate,  and  the  like;  and 
their  several  conflicting  claims  can  only  be  settled  by  a  deep 
plunge  into  the  theory  of  the  Roman  law  upon  the  subject  of 
these  several  pacts,  where  we  might  perhaps  lose  ourselves 
in  the  subtleties  of  interpretation.  But  these  different  char- 
acters have  been  attributed  to  it  according  to  the  point  of 
view  occupied  by  each  different  writer,  and  with  reference 
to  some  special  application  to  a  particular  subject-matter, 
rather  than  in  accordance  with  considerations  drawn  from 
the  nature  of  the  contract  itself.  But  it  is  a  contract 
governed  by  the  same  principles  which  govern  other  con- 
tracts. ^  (a)  Like  all  other  contracts  it  must  have  its  recip- 
rocal consent,  and  a  consideration  therefor.  "The  consent 
of  the  contracting  parties  in  all  things  which  constitute  the 
substance  of  the  contract,"  says  Pothier,^  "is  of  the  essence 
of  the  contract  of  insurance  as  of  all  other  contracts. "  It 
is,  however,  a  peculiar  contract,  distinguished  by  special 
characteristics,  and  requiring  for  its  proper  elucidation  to 
be  interpreted  in  the  light  of  the  circumstances  in  the  midst 

1  Cornfoot  v.  Fowke,  6  M.  &  W.  358. 

2  Traite  de  Cont.  d'Ass.  No.  87. 

(a)  As  in  other  contractual  cases,  accepted ;  but  when  it  is  accepted,  and 
the  contract  must  be  definite  and  cer-  nothing  remains  for  the  applicant  to 
tain,  and  such  as  to  bind  both  par-  do,  the  contract  is  complete  and  bind- 
ties,  —  the  one  to  insure,  the  other  ing,  actual  delivery  of  the  policy  to  the 
to  pay  the  premium  ;  and  the  parties  insured  not  being  essential  to  its  valid- 
must  also  have  agreed  upon  all  essential  ity,  unless  expressly  made  so  by  its 
terms.  If  their  minds  have  not  met,  terms.  New  York  L.  Ins.  Co.  v.  Bab- 
there  is  no  liability  for  a  loss  ;  as  where  cock,  104  Ga.  67,  70  ;.69  Am.  St.  Rep. 
the  rate  of  premium  is  left  undeter-  134,  143,  and  note ;  Phoenix  Ass.  Co., 
mined,  or  the  time  when  the  policy  ?;.  McAuthor,  116  Ala.  659;  Dibble  v. 
shall  attach,  or  the  apportionment  of  Northern  Ass.  Co.,  70  Mich.  1.  The 
the  risk,  has  not  been  agreed  upon,  or  insurer's  failure  to  respond  to  an  appli- 
the  insured  retains  control  over  the  pre-  cation  implies  a  rejection  and  not  an 
mium  note  or  over  any  papers  the  de-  acceptance  of  the  risk.  More  v.  New 
liveryof  which  is  a  condition  precedent;  York  Bowery  F.  Ins.  Co.,  130  N.  Y. 
or  if  anything  remains  to  be  done  by  537. 

the  insured  as  a  condition  precedent.  In  life  insurance,  the  courts  will  not 

Croft   V.  Hanover  F.   Ins.  Co.,  40  W.  decide  upon  the  validity  of  a  policy  dur- 

Va.  508,  513  ;  Taylor  v.  State  Ins.  Co.,  ing  the  assured's  lifetime.     Honour  v. 

107  Iowa,  275.     The  contract  is   not  Equitable  L.  Ass.  Society  [1900],  W.  N. 

consummated  until  the  application  is  67. 

6 


CH.  I.]        OF  THE  NATURE  OF  THE  CONTRACT.         [§  4 

of  which  it  has  grown  up.  and  with  a  just  appreciation  of  the 
purposes  which  it  is  designed  to  effect/ 

§  4.  A  Conditional  Contract.  —  It  is,  moreover,  a  condi- 
tional contract;  for  when  no  risk  attaches  no  premium  is  to 
be  paid,  or  if  paid,  must,  in  the  absence  of  fraud,  be  re- 
turned to  the  assured.  2  (a)  In  point  of  fact,  the  contract  is 
to  pay  the  premium  on  condition  that  the  risk  is  run,  and 
the  refunding  a  premium  is  of  frequent  occurrence  in  mari- 
time insurance ;  and  that,  too,  in  cases  where  it  is  entirely 
optional  with  the  assured  whether  the  property  insured  shall 
be  put  at  hazard  or  not,  as  where  the  ship  is  never  de- 
spatched by  the  owner  on  the  projected  voyage.  The  lan- 
guage of  Lord  Mansfield  in  Tyrie  v.  Fletcher,  above  cited, 
is  explicit.  "  When  the  risk  has  not  been  run,  whether  its 
not  having  been  run  was  owing  to  the  fault,  pleasure,  or 
will  of  the  insured,  or  to  any  other  cause,  the  premium  shall 
be  returned."  And  this  principle  is  alike  applicable  to  all 
policies  of  insurance.  The  language  of  the  continental 
writers,  generally,  is  in  accordance  with  this  doctrine.  It 
would  seem,  therefore,  says  Alauzet,^  that  the  engagement 
of  the  assured  is  not  absolute,  but  conditional,  like  that  of 
the  insurer ;  that  of  the  latter  depending  upon  the  condition 
that  an  accident  happen,  and  that  of  the  former  upon  the 
condition  that  the  subject-matter  of  insurance  be  put  at  risk. 
The  Italian  writers,  however,  maintain  with  great  unanimity 
that  when  once  the  contract  has  been  signed,  the  premium 
is  absolutely  due  to  the  insurer,  and  is  irrevocable;  and, 
reasoning  according  to  the  analogies  of  the  contract  of  sale, 
which  will  not  permit  the  purchaser  to  recant  at  pleasure, 
and  demand  back  the  purchase-money,  ask,  with  some  sig- 
nificance, why  the  insurer  should  be  made  the  victim  of  an 
act  to  which  he  is  a  total  stranger,  for  which  he  is  in  no 

1  Eraerigon,  Traite  dea  Assurances,  c.  1,  §  2. 

a  Stevenson  v.  Snow,  3  Burr.  12.37  ;  Tyrie  v.  Fletcher,  Cowt).  666  ;  Pothier, 
Du  Cont.  d'Ass.  4  ;  Pardessus,  Droit  Commercial,  596,  3  ;  2  Marsh.  663  ;  post, 
§§  .567,  569. 

3  Traite  Gen.  des  Assurances,  179. 

{a)  This  applies  to  both  fire  and  life  604  ;  United  States  Life  Ins.  Co.  v. 
insurance.     Jones  v.  Ins.  Co.,  90  Tenn.     Smith,  92  Fed  Kep.  503,  509. 

7 


§  6]  INSURANCE  :  FIRE,   LIFE,  ACCIDENT,   ETC.  [CH.  L 

way  responsible,  and  to  which  the  assured  himself  is  in  no 
way  compelled.!  But  this  strictness  of  interpretation  has 
not  obtained  in  other  and  more  mercantile  communities, 
where  the  doctrines  of  insurance  have  been  developed  under 
the  influence  of  a  liberal  purpose,  so  far  as  consistent  with 
general  principles,  to  foster  the  spirit  of  commercial  enter- 
prise. In  such  communities  the  law  is  jealous  of  any  hin- 
drance in  the  way  of  the  complete  abandonment  of  an  adven- 
ture which  may  have  been  determined  upon  and  insured,  but 
which,  subsequent  information  may  show,  would  be  impru- 
dent or  disastrous ;  and  it  takes  care  that  the  fact  of  having 
paid  th'?  premium  shall  have  no  influence  upon  the  delibera- 
tion whether  to  proceed  or  abandon. 

§  5.  An  Aleatory  Contract.  —  It  is  also  what  the  French 
writers  term  an  aleatory'^  contract,  or  one  in  which  the 
equivalent  consists  in  the  chances  for  gain  or  loss,  to  the 
respective  parties,  depending  upon  an  uncertain  event,  in 
contradistinction  from  a  commutative  contract,  in  which  the 
thing  given  or  act  done  by  one  party  is  regarded  as  the  exact 
equivalent  of  the  money  paid  or  act  done  by  the  other.^ 
Each  party  runs  his  risks.  The  insurer  will  gain  the  pre- 
mium if  no  loss  happens;  and  will  be  obliged  to  make  repa- 
ration if  it  does,  (a)  On  the  other  hand,  the  insured  will,  in 
the  former  case,  have  paid  his  premium  to  no  purpose; 
while,  in  the  latter,  he  will  be  indemnified  for  his  loss  by 
the  insurer.* 

§  6.    A  Personal  Contract.  —  It  is  also  a  personal  Contract 


1  Alauzet,  uhi  supra. 

2  From  alea,  a  die,  dice,  or  throw  of  the  dice  ;  a  word  for  which  our  adjec- 
tives, "gaming"  and  "hazardous,"  are  not  exact  equivalents. 

8  Code  Civil,  1104. 

*  Rogron,  Code  de  Commerce  Explique,  title  x. ;  Des.  Ass.  Int. 


(a)  Even  when  the  insured  suffers  premium  for  the  balance   of  the  time 

no  loss,  yet  if  the  insurer  becomes  in-  named  in  the  policy  subsequent  to  the 

solvent  and  makes  an  assignment  for  assignment.     Smith  v.  National  Credit 

the  benefit  of  its  creditors,  the  policy  is  Ins.  Co.,  65  Minn.  283.    See  infra,  §  358, 

thereby   cancelled  and  the    insured  is  note, 
entitled  to  recover  back  the  unearned 


CH.  I.]        OF  THE  NATUKE  OF  THE  CONTRACT.  [§  6 

and  does  not  run  with  the  title  to  the  property. ^  (a)  Whether 
the  subject-matter  of  insurance  be  a  ship  or  a  building  or  a 
life,  or  whatever  else  it  may  be,  although  in  popular  lan- 
guage it  may  be  called  an  insurance  upon  the  ship  or  build- 
ing or  life,  or  some  other  thing,  yet  it  is  strictly  an 
agreement  with  some  person  interested  in  the  preservation 
of  the  subject-matter,  to  pay  him  a  sum  which  shall  amount 
to  an  indemnity,  or  a  certain  sum  agreed  upon  as  an  indem- 
nity, in  case  his  interest  in  the  subject-matter  shall  suffer 
diminution  of  value,  from  certain  specified  causes,  or  in  cer- 
tain specified  contingencies.^  It  is  a  mere  special  agreement 
with  a  party  seeking  to  secure  himself  against  apprehended 
loss  on  account  of  his  interest  in  a  particular  subject-matter, 
and  not  at  all  incidental  to  or  transferable  with  the  subject- 
matter.^  The  contract  of  insurance  does  not  run  with  the 
subject-matter  of  insurance,  unless  by  special  stipulations 
wholly  foreign  to  itself,  either  interpolated  in  the  contract, 
or  in  addition  thereto.  Satisfaction  is  to  be  made  to  the 
person  insured  for  the  loss  he  may  have  sustained ;  for  it 
cannot  properly  be  called  insuring  the  thing,  since  there  is 
no  possibility  of  doing  it,  and  therefore  must  mean  insuring 
the  person  from  damage.^  And  it  is  because  of  this  person- 
ality of  the  contract  that  it  has  been  held  that  if  a  mortgagee 
in  possession  for  condition  broken  insure  his  interest  in  the 
premises  without  any  agreement  therefor  between  him  and 
the  mortgagor,  and  a  loss  happens  for  which  the  mortgagee 
is  indemnified  by  the  insurers,  the  mortgagor,  on  a  bill  to 
redeem  and  for  an  account,  is  not  entitled  to  have  the 
amount  paid  to  the  mortgagee  deducted  from  the  amount  of 

1  [Quarles  v.  Clayton,  87  Tenn.  308.] 

2  AVilson  V.  Hill,  3  Met.  (Mass.)  66  ;  Disbrow  v.  Jones,  Harr.  (Mich.)  Ch.  48. 

3  Carpenter  v.  Providence  Wash.  Ins.  Co.,  16  Pet.  (U.  S.)  495. 

*  Sadlers'  Company  v.  Badcock,  2  Atk.  554  ;  Lynch  v.  Dalzell,  4  Bro.  Par. 
Cas.  431.     See  also  post,  §§  379,  456. 

(a)   As   an   insurance   contract  is  a  and  reasonable.     Farmers  &  Merchants 

personal  one  between  the  insured  and  Ins.  Co.  i*.  Jensen,  56  Neb.  284,  286  ; 

the   insurer,  a  provision   in  the  policy  Milwaukee  Mechanics'  Mutual  Ins.  Co. 

that  it  shall  cease  to  be  in  force  if  a  v.  Ketterlin,  24   111.  App.    188  ;  Lanc;- 

change  takes  place  in  the  insured's  title  don  v.  Minnesota  Farmers'  Mutual  Fire 

without  the  iusurei-'s  consent,  is  valid  Ins.  Ass'n,  22  Minn.  193  ;  infra,  §  264. 

9 


§  7]  INSURANCE  :   FIRE,    LIFE,   ACCIDENT,   ETC.  [CH.  I. 

his  charges  for  repairs. ^  A  contract  may,  however,  be  so 
framed  as  to  secure  successive  owners  of  the  same  property.  2 
§  7.  Purpose.  —  A  distinction  has  sometimes  been  taken 
between  marine  and  other  insurances,  and  life  insurance,  on 
the  ground  that  while  the  former  have  for  their  object  to 
indemnify  for  loss,  the  latter  is  an  absolute  engagement  to 
pay  a  fixed  sum  on  the  happening  of  a  certain  event,  with- 
out reference  to  any  damage  in  fact,  suffered  by  the  insured 
in  consequence. 3  But  this  distinction  is  superficial,  and 
rests  rather  upon  the  mode  of  applying  the  principles  and 
of  determining  the  amount  of  indemnity,  than  upon  any 
difference  in  the  principles  themselves.  Insurance  upon  a 
ship  or  a  house  at  a  fixed  valuation,  and  at  an  annual  pre- 
mium, until  one  is  lost  or  the  other  is  burned,  is  in  no  way 
different  in  principle  from  the  insurance  of  a  life  at  a  fixed 
valuation  and  at  an  annual  premium,  until  death.  And 
there  may  be  between  the  vigor  of  manhood  and  the  decrepi- 
tude of  old  age  the  same  change  in  value  that  the  house  or 
the  ship  may  undergo.  In  the  one  case,  the  insurance  is 
against  the  loss  of  capital,  which  produces  income ;  in  the 
other,  it  is  against  the  loss  of  faculties,  which  produce  in- 
come. There  is  the  same  difference,  having  reference  to 
the  question  of  indemnity,  between  valued  and  open  policies 
in  both  fire  and  marine  insurance  that  there  is  between  an 
open  policy  in  either  and  a  policy  of  life  insurance.  In  open 
policies  the  question  of  the  amount  of  the  indemnity  is  left 
to  be  determined  when  the  contingency  upon  which  it  be- 
comes due  shall  have  happened,  while  in  valued  policies  and 
policies  on  lives  the  value  of  the  interest  which  the  insured 
seeks  to  protect  is  agreed  upon  by  the  parties  and  inserted 
in  the  policy,  and  so  the  amount  of  indemnity  which  shall 

1  Wliite  V.  Brown,  2  Cush.  (Mass.)  412;  Gushing  v.  Thompson,  4  Red.  (Me.) 
496.  See  also  Leeds  v.  Cheetham,  1  Sim.  146  ;  Mildmay  v.  Folgham,  3  Ves„  Jr. 
472  ;  "Watson  v.  Bratton,  in  Eq.  1830,  cited  by  Ellis,  Fire  and  Life  Insurance 
and  Annuities,  155  ;  Adams  v.  Rockingham  Mut.  Fire  Ins.  Co.,  29  Me.  292. 
See  also  post,  §  72. 

2  Waring  v.  Indemnity  Fire  Ins.  Co.,  45  N.  Y.  606. 

3  Babbage's  "  Comparative  View  of  the  Various  Institutions  for  the  Assur- 
ance of  Lives,"  154  ;  Dalby  v.  India  &  London  Life  Assurance  Co.,  15  C.  B.  365  ; 
s.  c.  28  Eng.  L.  &  Eq.  312. 

10 


CH.  I.]       OF  THE  NATURE  OF  THE  CONTKACT,         [§  8 

become  due  on  the  happening  of  the  given  contingency  is 
predetermined.  The  purpose  in  all  cases  is  alike,  —  indem- 
nity for  the  loss  of  a  valuable  interest.  That  in  some  cases 
the  value  is  fixed  with  great  precision,  while  in  others  it  is 
of  such  a  speculative  character  as  to  admit  of  the  greatest 
latitude  of  estimate,  not  to  say  of  conjecture,  does  not  make 
it  the  less  a  valuable  interest.  There  must  be  this  interest 
to  support  the  contract.  This  is  essential.  What  it  shall 
be,  provided  it  be  valuable,  and  how  its  value  shall  be  ar- 
rived at,  are  simply  incidental  questions;  and,  however  they 
may  be  answered,  do  not  change  the  nature  of  the  contract 
from  one  of  indemnity  based  upon  an  interest  to  be  pro- 
tected, to  a  mere  wager  based  upon  no  interest  whatever. 
The  analogies  between  life  and  marine  policies  have  been 
matters  of  frequent  judicial  observation.  ^  When  it  is  said 
that  fire,  life,  and  other  insurances,  where  valued  policies 
obtain,  are  contracts  of  indemnity,  it  is  simply  intended 
that  to  support  them  the  insured  must  have  some  interest  in 
the  thing  insured.  The  amount  of  this  interest,  and  the 
amount  to  be  paid  in  case  of  loss,  may  be  fixed  by  arbitrary 
agreement,  even  before  the  loss,  according  to  the  modern 
practice,  if  not  strictly  according  to  the  ancient  doctrine,  of 
msurance.2 

§  8.  In  one  case,  after  much  consideration,  it  was  said 
that  the  contract  commonly,  called  life  insurance,  when 
properly  considered,  is  a  mere  contract  to  pay  a  certain  sum 
of  money  on  the  death  of  a  person  in  consideration  of  the 
due  payment  of  a  certain  annuity  for  his  life,  the  amount  of 
the  annuity  being  calculated  in  the  first  instance  according 
to  the  probable  duration  of  the  life,  and,  when  once  fixed, 
it  is  constant  and  invariable.      The  stipulated   amount  of 

• 

1  See  farther  upon  this  subject,  post,  §§  116,  117. 

2  Whiting  V.  Ind.  Mut.  Ins.  Co.,  15  Md.  297  ;  Strong  v.  Manufacturers'  Ins. 
Co.,  10  Pick.  (Mass.)  40;  Borden  v.  Hingham  Mut.  Fire  Ins.  Co.,  18  Pick. 
(Mass.)  523  ;  Miller  v.  Eagle  Life  and  Health  Ins.  Co.,  2  E.  D.  Smith  (N.  Y.  C. 
P.),  268  ;  Loomis  Adm.  v.  Eagle  Life  and  Health  Ins.  Co.,  6  Gray  (Mass.),  396  ; 
Bevin  v.  Conn.  Mut.  Life  Ins.  Co.,  23  Conn.  244 ;  Trenton  Mut.  Life  &  Fire  Ins. 
Co.  V.  Johnson,  4  Zabr.  (N.  J.)  576  ;  St.  John  v.  Am.  Mut.  Life  Ins.  Co.,  13  N. 
Y.  31. 

11 


§  8]  INSURANCE  :   FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  I. 

annuity  is  to  be  uniformly  paid  on  one  side,  and  the  sum  to 
be  i.uid  in  the  event  of  death  is  always  (except  when  boun- 
ties have  been  paid  by  prosperous  offices)  the  same  on  the 
other.      This  species  of  insurance,  it  was  also  said,  m  no 
way  resembles  a  contract  of  indemnity,  and  in  this  respect 
differs  from  policies  against  fire  and  against  marine  risks, 
which  are  both  properly  contracts  of  indemnity,  —  the  in- 
surer engaging  to  make  good,  within  certain  limited  amounts, 
the  losses  sustained  by  the  assured  in  their  buildings,  ships, 
and  effects.     In  life  insurance  the  loss  is  sure  to  come  when 
the  insurance  is  for  the  whole  life,  while  in  marine  and  lire 
insurance  the  loss  may  not  happen  within  the  time  covered 
by  the  insurance,  as  is  the  case  under  a  simple  life  policy 
for  a  limited  time.     And  the  case  of  Godsall  v.  Boldero,i  as 
to  so  much  of  the  decision  as  held  that  there  must  be  an 
insurable  interest  at  the  time  of  the  death,  was  declared  to 
have  been  decided  upon  a  mistaken  analogy  between  life 
insurance  and  marine  insurance. 2     And  where  a  policy  is 
effected  by  a  creditor  on  the  life  of  his  debtor,  in  pursuance 
of  a  contract  with  his  debtor,  who,  however,  is  no  party  to 
the  policy,  but  supplies  the  money  to  pay  the  premiums,  in 
such  case,  said  Stuart,  V.  C,  referring  to  the  case  of  Dal  by 
V.  India  and  London  Life  Assurance  Company,^  although  it 
may  be  true  that  the  contract  is  not  one  of  indemnity  as 
between  the  parties  to  the  policy,  it  is,  nevertheless,  one  as 
between  the  debtor  and  creditor;  so  that  after  the  debt  is 
discharged,  and  the  creditor's  interest  has  ceased,  the  debtor 
is  entitled  to  any  advantages   derivable  from  the  policy.^ 
The  case  of  Dalby  v.  India  and  London  Assurance  Company  ^ 

1  9  East,  72. 

2  Dalby  v.  India  &  London  Life  Assurance  Co.,  15  C.  B.  (6  J.  Scott)  364 
determined  in  the  Exchequer  Chamber.  And  see  also  Law  v.  London  Indis- 
putable Life  Policy  Co.,  1  Kay  &  Johns.  223.  And  the  general  doctrine  of  these 
cases  has  been  adopted  by  the  Supreme  Court  of  the  United  States.  Conn. 
Mut.  Life  Ins.  Co.  v.  Schaefer,  4  Otto  (U.  S.),  457  ;  «.  c.  and  note,  A.  L.  Reg.  16, 
N.  s.  392.  In  this  case  it  was  unsuccessfully  contended  that,  a  divorce  a  vinculo 
having  terminated  the  wife's  interest  in  the  life  of  her  husband,  she  could  not 
recover. 

8  15  C.  B.  (6  J.  Scott). 

4  Knox  V.  Turner,  21  L.  T.  N.  s.  701 ;  s.  c.  L.  R.  9  Ch.  155.      ^  Ubi  supra. 
12 


CH.  I.]        OF  THE  NATURE  OF  THE  CONTRACT.         [§  10 

turned  upon  the  question,  not  whether  there  should  be  an 
insurable  interest,  which  was  admitted,  but  whether  that 
interest  should  subsist  as  well  at  the  time  of  the  death  as 
at  the  time  of  entering  into  the  contract.  That  a  valuable 
interest,  for  the  loss  of  which  indemnity  might  be  claimed, 
must  exist  at  some  time,  as  the  support  of  the  policy,  was 
conceded.  This  case  will  be  further  considered  when  we 
come  to  treat  of  insurable  interest.^ 

§  9.  Reinsurance.  —  Reinsurance  is  merely  insurance  ap- 
plied in  a  special  way  and  to  cover,  in  whole  or  in  part,  a 
particular  risk  already  assumed.  When  an  insurer  finds  it 
prudent  or  convenient  to  protect  himself  from  loss  by  reason 
of  any  liability  he  has  assumed  under  a  policy,  he  may  con- 
tract with  another  to  relieve  him  from  that  liability,  and 
take  it  upon  himself.  This  is  to  reinsure ;  and  by  the  con- 
tract the  reinsurer,  except  as  to  the  matter  of  premium, 
which  may  be  more  or  less  than  that  paid  on  the  original 
policy,  as  the  parties  may  agree,  undertakes  with  reference 
to  the  first  insurer  what  the  first  insurer  undertakes  with 
reference  to  the  insured,  and  subject  to  like  rights,  duties, 
and  obligations.  2 

§  10.  Formerly  prohibited.  —  Reinsurance  was  formerly 
prohibited  in  England  by  statute  19  Geo.  II.  c.  371 ;  but 
this  prohibition  was  peculiar  to  England,  and  was  made  not 
from  any  objection  to  the  practice  when  confined  to  its  legiti- 
mate purpose,  —  to  save  the  party  procuring  the  reinsurance 
from  the  consequences  of  an  imprudent  contract,  — but  from 
the  fact  that  it  came  to  be  perverted  into  a  mode  of  speculat- 
ing in  the  rise  and  fall  of  premiums,  and  might,  therefore, 
be  made  a  cover  for  wager  policies.^  But  now,  by  the  law 
and  practice  of  every  country,  not  excepting  England,  the 
underwriter  may  have  the  entire  sum  he  has  insured  rein- 
sured to  him  by  some  other  underwriter.  It  is  a  common 
practice  in  this  country.^ 

1  Post,  §115  c«  seq. 

2  Canada  Mut.  Fire  Ins.  Co.  v.  Northern  Ins.  Co.,  2  Ct.  of  App.  (Out. )  373. 

3  Arnould,  Ins.  1,  290  ;  Andi-ee  v.  Fletcher,  2  T.  R.  161  ;  3  Law  Mag.  (3d 
series)   579. 

*  Phil.  Ins.  e.  3,  §  13  ;  Merry  v.  Prince,  2  Mass.  176  ;  Hastie  u.De  Peyster, 

13 


§11]  INSURANCE  :   FIRE,   LIFE,    ACCIDENT,    ETC.  [CH.  I. 

§  11.  Reinsurance  defined.  —  It  is  a  contract  of  indemnity 
to  the  reinsured,  whatever  be  the  subject-matter,  and  binds 
the  reinsurer  to  pay  to  the  reinsured  the  loss  sustained  in 
respect  to  the  subject  insured,  to  the  extent  for  which  he  is 
reinsurer,  1  and  not  necessarily  differing  in  form  from  an. 
original  insurance. ^  (a)  [Reinsurance  may  be  for  a  less  risk 
than  the  original  insurance  but  not  for  more.^  If  upon  loss 
the  insurer  pays  a  less  sum  than  the  original  insurance 
agreed  on,  the  sum  so  paid  will  be  taken  as  the  amount  of 
damage  sustained,  and  the  measure  of  indemnity  to  be  re- 
covered fi-om  the  reinsuring  company,  provided  such  sum  is 
within  the  amount  of  the  reinsurance  and  does  not  exceed 
the  loss,  and  there  is  no  provision  in  the  policy  of  reinsur- 
ance for  prorating  or  limiting  liability.*]  The  reinsured,  in 
order  to  recover  against  the  reinsurer,  must  prove  his  risk 

3  Caine.s'(N.  Y.),  190  J;  Herckenrath  v.  Am.  Mut.  Ins.  Co.,  3  Barb.  (N.  Y.)  Ch. 
63  ;  Arnould,  Ins.  1,  290  ;  Consolidated  Real  Estate  &  Fire  Ins.  Co.  v.  Cashow, 
41  Md.  59.  It  seems  that  19  Geo.  II.  c.  371  applied  only  to  marine  insurance, 
and,  HO  far  as  this  is  concerned,  it  was  in  force  in  Maryland  in  1874. 

1  Hone  V.  Mut.  Saf.  Ins.  Co.,  1  Sand.  Superior  Gt.  Rep.  (N.  Y.)  137.  [The 
reinsuring  company  need  pay  no  more  than  is  paid  by  the  first  insuring  company. 
The  contract  of  reinsurance  is  one  of  indemnity,  not  of  profit.  111.  Mut.  Ins.  Co. 
V.  Andes  Ins.  Co.,  67  111.  362,  365.] 

2  New  York  Bow.  Ins.  Co.  v.  New  York  Fire  Ins.  Co.,  17  Wend.  (N.  Y.)  359. 
8  [Philadelphia  Ins.  Co.  v.  Wash.  Ins.  Co.,  23  Penn.  St.  250,  253.] 

*  [Insurance  Co.  v.  Insurance  Co.,  38  Ohio  St.  11.] 

(a)  The  object  being  indemnity  tract  of  insurance  ;  hence  while  valid  as 
against  the  insurer's  own  act,  he  may  to  policies  already  exi.sting,  reinsurance 
have  the  entire  sum  insured  by  him  j'e-  is  void  as  a  wager  as  to  policies  there- 
assured  by  some  other  insurer.  Ins.  Co.  after  to  be  written.  Sun  Ins.  Office  v. 
of  North  America  v.  Hibernia  Ins.  Co.,  Merz  (N.  J.  L.),  43  Atl.  693.  This  does 
140  U.  S.  565.  This,  however,  is  rarely  not,  however,  invalidate  reinsurance  on 
done,  the  original  insurer  usually  re-  marine  fire  risks,  so  ikr  as  fire  is  treated 
taining  part  of  the  risk,  in  which  case  as  a  part  of  the  marine  risk.  Boston 
he  looks  to  the  reinsurer  for  indemnity  Ins.  Co.  v.  Globe  F.  Ins.  Co.,  174  Mass. 
up  to  the  full  amount  reinsured.  See  229  ;  Continental  Ins.  Co.  v.  Mtna.  Ins. 
Chalaron  f.  Ins.  Co.  of  North  America,  Co.,  138  N.  Y.  16.  See  Iowa  L.  Ins.  Co. 
48  La.  An.  1582,  1585,  1589.  That  v.  Eastern  Mut.  L.  Ins.  Co.  (N.  J.),  45 
reinsurance  by  a  cor])oratiou  may  be  Atl.  762.  As  reinsurance  is  not  always 
ultra  vires,  see  Twiss  v.  Guaranty  Life  upon  the  same  risk  as  the  original  insur- 
A.ss'n,  87  Iowa,  733 ;  Jameson  v.  Hart-  ance,  and  as  there  is  no  general  form  of 
ford  F.  Ins.  Co.,  44  N.  Y.  S.  15.  The  marine  policy,  there  is  no  presumption 
riglit  to  procure  contracts  of  fire  rein-  that  a  reinsured  marine  risk  is  the  same 
surance  is  founded  upon  the  insurable  as  that  originally  insured.  Penn.  Ins. 
interest  arising  out  of  the  original  con-  Co.  v.  Telfair,  61  N.  Y  S  322 

14 


CH.  I.]        OF  THE  NATURE  OF  THE  CONTRACT.         [§11 

or  interest  in  the  subject-matter,  and  the  fact  and  amount 
of  loss,  in  the  same  manner  as  the  original  insured  must 
have  proved  them  against  him ;  ^  and  the  reinsurer  is  entitled 
to  make  the  same  defence  to  an  action  brought  against  him 
on  the  second  policy  as  the  original  insurer  might  have  done 
on  the  first  policy. ^  (z)  It  is  not  necessary  fol*  the  reinsured 
to  pay  the  loss  to  the  first  insured  before  proceeding  against 
the  reinsurer,^  nor  is  the  liability  of  the  latter  affected  by 
the  insolvency  of  the  reinsured,  or  his  inability  to  fulfil  his 
own  contract  with  the  original  insured.  Nor  is  it  compe- 
tent, unless  so  agreed,  to  limit  the  liability  on  a  contract  of 
reinsurance  by  proof  of  a  usage  in  the  place  where  the  con- 
tract is  made,  by  which  the  reinsurer  pays  the  same  propor- 
tion of  the  entire  loss  sustained  by  the  original  insured  that 
the  sum  reinsured  bears  to  the  first  insurance  written  by  the 
reinsured.*  Under  an  agreement,  however,  that  the  rein- 
surer shall  be  liable  pro  rata,  and  only  in  the  same  manner 
and  at  the  same  time  as  the  reinsured,  the  liability  of  the 
reinsurer  is  limited  to  indemnity.  And  the  provision  as  to 
time  means,  that  payment  shall  be  made  by  the  reinsurer 
in  point  of  time,  as  the  reinsured  had  contracted  to  make 
it.^  [A  clause  in  a  reinsurance  policy  that  the  reinsurer 
shall  only  pay  pro  rata  at  and  in  the  same  time  as  the  assured 
has  no  reference  to  insolvency  of  the  reinsured.^]  The  lia- 
bility of  the  reinsurer,  unless  specially  limited  by  agreement, 
is  coextensive  with  that  of  the  reinsured.  When,  by  the 
terms  of  the  reinsurer's  policy,  suit  may  be  brought  directly 

1  3  Kent,  Com.  279  ;  Yonkers  Ins.  Co.  v.  HofF.  Ins.  Co.,  6  Rob.  (N.  Y.)  316. 

2  New  York  Mar.  Ins.  Co.  v.  Prot.  Ins.  Co.,  1  Story,  C.  Ct.  458  ;  Eagle  Ins. 
Co.  V.  Lafayette  Ins.  Co.,  9  Ind.  443.  [Merchant's  Mut.  Ins.  Co.  v.  New  Orleans 
Mut.  Ins.  Co.,  24  La.  An.  305  at  307.] 

8  [Gantt  V.  American  Cent.  Ins.  Co.,  68  Mo.  503,  534.] 

*  Hone  V.  Mut.  Saf.  Ins.  Co.,  1  Sand.  Superior  Ct.  Rep.  (N.  Y.)  137.  And  see 
s.  c.  affirmed,  2  Comst.  (N.  Y.)  235. 

6  Blackstone  v.  Alemannia  Ins.  Co.,  56  N.  Y.  104;  111.  Mut.  Ins.  Co.  v.  Andes 
Ins.  Co.,  67  111.  362  ;  Republic  Ins.  Co.,  In  re  (U.  S.  Dist.  Ct),  8  Nat.  Bank. 
Reg.  197  ;  s.  c.  3  Ins.  L.  J.  390  ;  Norwood  v.  Resolute  Fire  Ins.  Co.,  4  J.  &  Sp. 
(N.  Y.)  552  ;  Consolidated,  &c.  Fire  Ins.  v.  Cashow,  41  Md.  59;  Casliau  v.  N. 
W.  N.  Ins.  Co.,  5  Biss.  (U.  S.  Dist.  Ct.)  476 ;  Norwood,  Ex  jjarte,  3  Biss.  C.  Ct. 
504. 

6  [Cashau  v.  North  Western  Nat,  Ins.  Co.,  5  Biss.  476,  479.] 

15 


§  11]  insurance:  fire,  life,  accident,  etc.  [ch.  l 

by  the  original  insured  against  the  reinsurer,  the  latter  can- 
not defend  on  the  ground  that  the  first  insurer  has  been  paid 
on  other  policies  of  reinsurance  upon  the  same  risk  of  life. 
That,  however,  may  be  a  matter  for  adjustment  between  the 
reiiisurer  and  the  reinsured.^     (zi)  Where  the  reinsurer  has 
notice  from  the  reinsured  that  a  suit  has  been  commenced 
against  the  latter,  and  that  the  former  will  be  looked  to  for 
the  costs  and  expenses  of  defence,  and  no  objection  is  made 
by  the  reinsurer,  and  the  reinsured  has  just  grounds  for  con- 
testing the  claim,  the  reinsurer  will  be  holden  to  pay  to  the 
reinsured  the  costs  and  expenses  of  such  defence  in  addition 
to  the  actual  loss.     But  costs  and  expenses,   wantonly  and 
unnecessarily   so   incurred,    when    there    is    no   reasonable 
ground  of  defence,  and  when  there  is  no  express  or  implied 
sanction  of  the  defence  by  the  reinsurer,   cannot  be  recov- 
ered by  the  reinsured.  2     A  party  obtaining  a  policy  of  re- 
insurance  is   bound  to   communicate   all   facts   within   his 
knowledge,  and  to  conceal  none  material  to  the  risk ;  and  if 
he  fail  in  this  behalf,  whether  from  design  or  misapprehen- 
sion of  their  materiality,  as  in  cases  of  original  insurance, 
the   policy  of   reinsurance    will   be    void.^       [For   example, 
underwriters  applying  for  reinsurance  are  bound  to  tell  what 
they  know  of  the  character  of   the  assured.-^     So  where  M 
had  double  insurance  on  his  ship  and   its  earnings.      This 
fact  was  known  to  the  Ocean  Company,  and  was  not  com- 
municated to  the  Sun  Company  when  the  latter  issued  a  pol- 
icy  to   reinsure  the   Ocean    Company,    on  its  risk   for  M. 
Knowledge  of  the   circumstance  was   manifestly  material. 
It  was  a  flagrant  case  of   overinsurance,   that  made   it  the 
pecuniary  interest  of  the  master  to  disregard  the  safety  of 
the  ship.     The  assured  will  not  be  allowed  to  protect  himself 

1  Glen  V.  Hope  Mut.  Life  Ins.  Co.,  56  N.  Y.  379. 

2  New  York  Mar.  Ins.  Co.  v.  Prot.  Ins.  Co.,  1  Story,  C.  Ct.  458  ;  Hastie  v. 
De  Peyster,  3  Caines  (N.  Y.),  190  6;  Strong  v.  Phoenix  Ins.  Co.,  62  Mo.  289; 
Stronfj  V.  Am.  Central  Ins.  Co.,  4  Mo.  App.  7  ;  Gantt  v.  Am.  Central  Ins.  Co., 
Sup.  Ct.  Mo.,  9  Ins.  L.  J.  664. 

*  New  York  Bowery  Fire  Ins.  Co.  v.  New  York  Fire  Ins.  Co.,  17  Wend.  (N.  Y.) 
359  ;  People's  Ins.  Co.  v.  Hartford  Ins.  Co.  (U.  S.  C.  Ct.,  North  Dist.  Cal.),  1  Ins. 
L.  J.  875  ;  68  Mo.  503. 

*  [New  York  Bowery  F.  Ins.  Co.  v.  New  York  Ins.  Co.,  17  Wend.  359,  367.] 

16 


CH.   I.]  OF   THE   NATURE   OF   THE   CONTRACT.  [§11 

against  the  charge  of  undue  concealment  by  affirming  that 
he  had  disclosed  the  truth  in  general  terms.  Where  his  in- 
formation is  specific  it  must  be  communicated  specifically. 
He  must  see  to  it  that  the  insurer's  knowledge  is  substan- 
tially as  full  and  particular  as  his  own.  ^  Justices  Miller, 
Waite,  and  Bradley  dissented,  holding  that  a  reinsurer  was 
not  to  be  looked  at  in  the  same  light  as  a  joint  insurer  or 
an  original  insurer,  —  that  in  point  of  fact,  the  Sun  Com- 
pany insured  the  risk  the  Ocean  Company  had  taken,  and 
unless  there  were  misrepresentation,  fraud,  or  intentional 
concealment,  the  Sun  ought  to  pay  the  loss  the  Ocean  had 
incurred.  There  had  been  a  course  of  dealing  between  the 
companies  in  which  the  Sun  had  been  in  the  habit  of  rein- 
suring the  Ocean,  without  inquiry  into  the  particulars. ^J 
As  the  reinsurer  merely  substitutes  himself  for  the  original 
insurer,  he  can  make  no  defence  that  the  latter  could  not. 
Hence  a  representation  which  was  true  when  the  original 
policy  was  made,  but  was  false  when  the  reinsurance  was 
made,  is  of  no  avail  to  the  reinsurer. ^  [Neither  can  a  mis- 
representation in  the  description  of  the  property  in  the 
original  application  be  taken  advantage  of  by  the  reinsurer. 
The  risk  of  the  insurer  is  the  object  of  reinsurance,  and  if 
this  was  correctly  stated  and  the  insurer  has  been  found 
legally  liable  for  a  loss,  the  reinsurer  must  pay.*]  The 
notice  of  loss  from  the  original  insured  to  the  reinsured,  if 
sufficient,  and  it  be  immediately  forwarded  to  the  reinsurer, 
will  be  sufficient  notice  to  the  latter.^  [Upon  a  constructive 
total  loss,  notice  of  the  abandonment  of  the  ship  need  not 
be  given  to  the  reinsurers.^]  Where  the  reinsurer  stipu- 
lates that  the  reinsured  policy  is  subject  to  the  conditions 
of  settlement  as  set  forth  in  the  latter,  no  preliminary  proof 
need  be  furnished  by  the  latter  to  the  former.  ^     [In  a  con- 

1  [Sun  Mnt.  Ins.  Co.  v.  Ocean  Ins.  Co.,  107  U.  S.  485,  505,  510.1 

2  [Id.  511.] 

8  Cahen  v.  Continental  Life  Ins.  Co.,  69  X.  Y.  800. 
*  [Jackson  v.  St.  Paul  F.  &  M.  Ins.  Co.,  99  N.  Y.  124.] 
^  See  cases  in  note  3,  preceding  page  (p.  16). 
«  [Uzielli  V.  Boston  M.  Ins.  Co.,  15  Q.  B.  D.  11.] 

'  Consolidated,  &c.  Fire  Ins.  Co.  v.  Cashow,  41  Md.  59;  s.  c.  3  Ins.  L.  J.  757. 
VOL.  I.  —  2  Yj 


§  11  A]       insurance:  fire,  life,  accident,  etc.  [ch.  i. 

tract  of  reinsurance  which  follows  the  original  policy,  except 
that  "  reinsurance  "  is  substituted  for  "  insurance, "  and  which 
provides  for  proofs  of  loss,  &c.,  attested  by  "their  oath,"  it 
is  sufficient  if  the  oath  of  the  original  assured  without  that 
of  the  original  insurers,  is  procured,  i  Where  the  insurer 
agreed  with  the  reinsurer  to  defend  against  the  suit  of  the 
insured,  the  insurer  to  act  in  the  matter  as  agent  of  the 
reinsurer,  and  the  insurer,  instead  of  contesting  the  action, 
without  the  knowledge  of  the  reinsurer  settled  it  and  had  it 
dismissed,  it  was  held  that  the  insurer  could  not  recover  of 
the  reinsurer.  2 

[§  11  A.  Extent  of  the  Reinsurer's  LiabiUty  ;  Insolvency.  — 
It  has  already  been  noted  that  the  contract  of  reinsurance  is 
one  of  indemnity  and  that  only.  The  cases  and  text  books 
are  saturated  with  that  doctrine  in  respect  to  all  varieties  of 
insurance.  It  is  sometimes,  however,  a  very  interesting 
question,  what  constitutes  indemnity.  For  example,  where 
the  original  insurer  settles  with  the  assured  for  less  than  the 
loss  for  which  it  was  liable,  or  where  it  is  insolvent  and 
cannot  pay  in  full,  then  how  much  shall  the  reinsurer  be 
required  to  pay?  Wood  on  page  818  says  that  New  York, 
Indiana,  Maryland,  and  the  United  States  Circuit  Court 
give  the  reinsurer  the  benefit  of  the  compromise  in  case  of 
insolvency,  <fec.,  while  Illinois  does  not.  It  appears,  how- 
ever, that  the  former  authorities  refuse  to  allow  the  rein- 
surer to  say  anything  about  the  insolvency  of  the  insurer, 
and  make  the  liaUlity  not  the  ability  of  the  latter  the  meas- 
ure of  the  liability  of  the  insurer,  and  that  Illinois  in  a  very 
clear  case  gives  the  reinsurer  the  benefit  of  an  actual  settle- 
ment by  the  insurer.  Before  examining  the  cases  it  may  be 
remarked  that  on  principle  the  matter  seems  perfectly  clear. 
If  the  insurer  (A)  sues  the  reinsurer  (B)  before  A  has  reached 
a  final  settlement  with  the  assured  (C),  then  the  reinsurer 
must  be  liable  to  pay  A  as  much  as  and  no  more  than  A  is 
liable  to  pay  C,  unless  otherwise  clearly  agreed,  and  after  B 
has  paid  A,  the  latter  may  settle  as  best  he  can.     But  if  A 

1  [N.  Y.  Bowery  F.  Ins.  Co.  v.  N.  Y.  F.  Ins.  Co.,  17  Wend.  359,  365.] 

2  [Commercial  Union  Ass.  Co.  v.  Amer.  Cent.  Ins.  Co.,  68  Cal.  430.] 

18 


CH.  I.]        OF  THE  NATURE  OF  THE  CONTRACT.      [§  11  A 

sues  B  after  C  has  been  paid  all  he  is  to  be  paid,  then  A 
ought  to  recover  no  more  from  B  than  he  paid  to  C,  other- 
wise he  would  be  getting  not  indemnity  but  a  profit.  If  A 
becomes  insolvent  and  makes  a  final  settlement  and  is  dis- 
charged, it  ought  to  recover  no  more  from  B  than  was  paid 
to  C,  or  it  would  in  a  sense  make  money  by  its  own  care- 
lessness in  failing.  When  C  is  paid  off,  the  other  creditors 
can  have  no  claim  on  what  is  due  from  B  on  C's  loss,  unless 
the  reinsurance  was  taken  into  account  in  making  the  cal- 
culation of  dividends  under  which  C  was  paid. 

The  Cases. 

Where  the  reinsured  was  insolvent  and  had  paid  a  divi- 
dend of  20  per  cent  before  bringing  suit  against  the  rein- 
surer, it  was  held  that  the  full  loss  could  be  recovered,  and 
that  "the  original  assured  has  no  claim  in  respect  of  the 
money  so  paid."^  This  last  sentence  seems  too  sweeping. 
The  assured  had  no  distinctive  claim  on  those  funds,  no 
claim  different  from  that  of  any  other  creditor  of  the  insol- 
vent company,  but  in  common  with  the  other  creditors  he 
did  have  a  claim,  and  it  was  that  fact  that  made  the  deci- 
sion right.  The  claim  against  the  reinsurer  was  part  of  the 
assets  in  the  hands  of  the  receiver  to  be  administered  for 
the  benefit  of  all  the  creditors. 

It  was  objected  in  one  case  that  the  reinsurer  could  not  be 
liable  to  pay  the  reinsured  any  more  than  the  assets  of  the 
latter  would  pay  to  the  insured.  But  the  court  held  this 
proposition  manifestly  unsound,  and  said  that  the  liaUlity 
not  the  ability  of  the  insurer  was  the  measure  of  the  liability 
of  the  reinsurer. 2  In  a  subsequent  case,  the  facts  as  stated 
were  a  little  different  in  that  a  dividend  of  44  per  cent  had 
been  declared,  and  that  "was  all  that  has  been  or  will*  be 
paid  to  the  original  assured  upon  their  policy."  The  court 
decided  the  question  as  to  the  measure  of  the  reinsurer's  lia- 
bility in  the  same  way  as  in  the  last  case,  simply  referring 
to  that  for  reasons.  Now,  if  the  dividend  had  been  calcu- 
lated and  paid  without  reference  to  this  claim  against  the 

1  [Consolidated  Real  Estate  &  F.  Ins.  Co.  v.  Cashow,  41  Md.  74.] 

2  [Hone  V.  Mut.  Safety  Ins.  Co.,  1  Sandf.  (Super.  Ct.)  137,  152.] 

19 


§12]  insurance:    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  L 

reinsurer,  then  the  case  materially  differed  from  the  former, 
and  the  decision  is  not  well  based,  but,  if,  as  is  possible, 
though  not  stated,  this  claim  was  one  of  the  things  that 
entered  into  the  calculation  of  that  dividend,  the  ruling  is 
sound.  ^ 

If  the  original  assured  cannot  sue  the  insurer,  because, 
for  example,  the  period  of  limitation  has  run  against  him, 
then,  as  there  is  no  liability/  on  the  part  of  the  insurer,  he 
cannot  recover  of  the  rei usurer.  ^ 

In  Illinois  the  true  doctrine  has  been  clearly  announced. 
The  original  insurer  became  liable  to  pay  to  the  assured  the 
sum  of  $6000,  but  actually  paid  $600  in  full  discharge  of  the 
whole  liability.  The  court  held  that  only  $«600  could  be  re- 
covered from  the  reinsurer.  The  cases  above  cited  in  this 
section  are  noticed,  and  the  court  clearly  makes  the  distinc- 
tion between  cases  in  which  the  insurer  has  actually  settled, 
and  those  in  which  full  settlement  has  not  been  made;  and 
in  the  latter  cases,  although  not  able  to  pay  in  full,  the  in- 
surer, the  judge  remarks,  may  with  some  show  of  reason 
recover  in  full  of  the  reinsurer.  But  to  do  so  in  the  former 
cases  would  enable  it  to  realize  a  clear  gain  above  what  the 
fire  or  other  loss  has  caused  it.^ 

The  United  States  Circuit  Court  holds  that  the  reinsurer 
may  be  sued  by  the  receiver  of  the  insolvent  insuring  com- 
pany, for  the  full  amount  of  the  liability  of  the  latter,  with- 
out reference  to  its  assets.^  In  both  cases  the  matter  was 
still  open,  no  final  settlement  had  been  made.] 

§12.  "The  original  contract,"  says  Emerigon,  "subsists 
precisely  as  it  was  made,  without  renewal  or  alteration. 
The  reinsurance  is  absolutely  foreign  to  the  first  insured, 
with  whom  the  reinsurer  contracts  no  sort  of  obligation. 
The  risks  which  the  insurer  has  assumed  constitute  between 
him  and  the  reinsurer  the  subject-matter  of  the  contract  of 
reinsurance,  which  is  a  new  contract,  totally  distinct  from 

1  [Blackstone  v.  Aleniannia  F.  Ins.  Co.,  56  N.  Y.  104.] 

2  [Eagle  Ins.  Co.  v.  Lafayette  Ins.  Co.,  9  Ind.  446.] 

8  [in.  Mut.  F.  Ins.  Co.  V.  Andes  Ins.  Co.,  67  IlL  362.] 
<  [Cashau  i'.  N.  W.  Ins.  Co.,  5  Biss.  476;  Ex  parte  Norwood,  3  id.  504.] 
20  ■ 


CH.  I.]       OF  THE  NATURE  OF  THE  CONTRACT.         [§  12 

the  first.  1  (a)  It  cannot,  therefore,  in  the  strict  sense,  be 
made  with  the  party  first  insured,  for  this  would  be  a  simple 
rescission  of  the  contract  ;2  nor  does  the  latter  by  it  acquire 

1  Emerigon,  Traite  des  Assurances,  c.  8,  §  14;  Herckenrath  v.  Am.  Mat.  Ihs. 
Co.,  3  Barb.  (N.  Y. )  Ch.  63. 

2  [Sometimes  however  the  word  "reinsurance"  is  used  to  denote  a  contract 
by  which  an  old  company  sells  out  to  a  new  one,  or  becomes  consolidated  with  it, 
so  that  the  new  company  becomes  liable  directly  to  the  insured.  And  it  is  always 
competent  for  the  reinsuring  company  to  agree  to  be  directly  liable.  Where  a 
London  company  sold  out  to  an  American  company  which  reinsured  all  policies 
in  the  former  company  held  in  this  countr}',  it  was  held  that  such  a  policy-holder 
could  sue  the  American  company  for  a  loss  arising  under  his  policy.  Johannes 
V.  Phenix  Ins.  Co.,  66  Wis.  50.  An  agreement  by  a  reinsuring  com})any  to 
pay  to  the  holders  of  policies  "all  such  sums"  as  the  first  company  "may  by 
force  of  such  policies  become  liable  to  pay,"  includes  a  policy-holder  who  is  seek- 
ing compensation  in  damages  for  a  failure  of  the  first  company  to  keep  alive  its 
contract  by  receiving  payment  of  premiums  when  tendered.  Fischer  v.  Hope 
Mut.  L.  Ins.  Co.,  69  N.  Y.  161,  164.  In  one  case  a  company  insured  a  man 
for  $15,000,  and  afterward  reinsured  .$10,000  of  the  risk  in  two  other  companies. 
A  fourth  company  subsequently  reinsured  all  the  outstanding  risks  of  the  first 
company,  after  which  the  insured  died.  An  arbitration  then  took  place  between 
the  several  companies,  as  the  result  of  which  it  was  decided  that  the  fourth  com- 
pany was  liable  only  for  $5,000,  the  two  original  reinsuring  companies  being 
liable  for  $10,000  which  they  had  after  the  loss  paid  to  the  first  company.  On 
this  state  of  facts  it  was  held  that  the  fourth  company  was  liable  to  the  original 

[a)  There  is  no  privity  between  the  privies,  and  the  insured  risk  be  merely 

reinsurer  and  the  person  originally  in-  transferred.      See,  e.  g..  People's  Mut. 

sured  ;   the  company  reinsured  has  an  Ass.  Fund  v.  Boesse,  92  Ky.   290.     An 

insurable  interest  in  the  insured  prop-  agreement  by  one  insurance  company  to 

erty,  but  as  an   "owner"   he   has   no  pay  the  losses  of  another  company  like 

other  relation  to  it  than  as  the  insurer  its  own  losses,  is  not  reinsurance;  under 

under  the  original  policy,  the  provisions  the   statutes   of  California,  the  first  of 

of  which  are  not  always  applicable  to  these  companies  is  liable  directly  to  the 

the  new  contract.     If,  for  instance,  that  insured    under   policies   issued    by   the 

policy  fixes  a  limited  period  for  suits,  second  company.       Whitney  v.  Ameri- 

this  period  does  not  apply  to  an  action  can  Ins.  Co.    (Cal.),   56  Pac.  50.      See 

upon   the   policy   of  reinsurance,   and,  Barnes  v.  Hekla  F.  Ins.  Co.,  56  Minn, 

under   a   provision   against  assignment  38 ;    Travellers'  Ins.   Co.    v.   California 

without     the    insurer's     consent,     the  Ins.  Co.,  1  No.  Dak.  151.     In  general, 

original  insurer  may  give  such  consent  however,   under  an   agreement   by   one 

as  against  the  reinsurer,  if  he  does  not  company  to  give  a  limited  free  insurance 

thereby    increase    the    risk.       Faneuil  tothepolicy  holders  of  another  company, 

Hall  Ins.    Co.  v.   Liverpool,    &c.,   Ins.  which  is  insolvent,  the  substituted  poli- 

Co.,    153    Mass.   63;  Pioyal  Ins.  Co.  v.  cies  need  not  conform  to,  and  are  not 

Vanderbilt   Ins.  Co.,    102  Tenn.    264  ;  controlled  bj',  the  original  policy  issued 

Barnes  u.  Hekla  F.   Ins.  Co.,  56  Minn,  by    the    second   company.      Brown    v. 

38;  infra,   §  12  B.      The  insured  and  U.  S.  Casualty  Co.,  88  Fed.  Kep.  38/ 

reinsurer   may,    however,    so    contract,  90  id.  829. 
through  new  papers,  as  to  make  them 

21 


§  12  A]         INSURANCE :    FIRE,   LIFE,  ACCIDENT,   ETC.  [CH.  I. 

any  rights  against  the  reinsurer,  in  case  of  the  insolvency  of 
the  retnsured,  or  any  claim  upon  the  money  to  be  paid  to 
the  latter.^  If  the  insurer  be  not  liable,  he  cannot  recover 
of  the  reinsurer,  for  the  reason  that  the  insurer  has  no  in- 
surable interest,  and  can  suffer  no  loss,  where  there  is  no 
liabilitv.2  Where,  in  a  policy  of  insurance  there  is  a  stipu- 
lation that  the  reinsurer  is  to  be  liable  only  for  his  propor- 
tion of  the  loss,  if  there  shall  be  other  insurance,  other 
insurance  means  other  insurance  of  a  like  kind,  that  is, 
other  reinsurance.  3  And  an  agreement  by  the  reinsured  to 
retain  an  amount  of  the  original  insurance  at  least  equal  to 
the  amount  of  reinsurance  is  practically  an  agreement  not 
to  further  reinsure,  and  is  not  violated  by  allowing  the 
amount  originally  insured  to  be  reduced  by  the  lapse  of  a 
policy  to  an  amount  slightly  (from  $2,800  to  12,500)  less 
than  the  amount  reinsured.*  That  the  interest  sought  to  be 
covered  is  an  insurer's  interest  need  not  be  stated,  as  this 
is  not  material.^ 

[§  12  A.  An  agreement  of  reinsurance  is  not  within  the 
statute  of  frauds  as  a  contract  to  answer  for  the  debt  or  default 
of  another.  6  When  a  charter  of  an  insurance  company  does 
not  expressly  give  power  to  reinsure,  but  is  made  subject  to 
a  General  Insurance  Act  which  does,  a  contract  of  reinsur- 
ance is  not  ultra  vires.  '^] 

assured  for  the  full  amount  of  $15,000  ;  tliat  the  assured  had  accepted  the  agree- 
ment for  reinsurance  made  by  them,  and  was  not  affected  by  the  arbitration. 
Glenn  v.  Hope  Mut.  L.  Ins.  Co.,  1  N.  Y.  Supr.  Ct.  463. 

1  Alauzet,  Traite  General  des  Assurances.  152. 

2  Eagle  Ins.  Co.  v.  Lafayette  Ins.  Co.,  9  Ind.  443  ;  New  York  Mar.  Ins.  Co. 
V.  Prot.  Ins.  Co.,  1  Story,  C.  Ct.  458  ;  Carpenter  v.  Providence  Ins.  Co.,  16  Pet. 
(U.  S.)  495  ;  Del.  Ins.  Co.  v.  Quaker  City  Ins.  Co.,  3  Grant's  Cases  (Penn.),  71. 

8  Mut.  Saf.  Ins.  Co.  v.  Hone,  2  Comst.  (N.  Y.)  235. 

*  Canada  Fire  &  Mar.  Ins.  Co.  v.  Northern  Ins.  Co.,  2  Ont.  App.  R.  373. 

5  Mackenzie  v.  Whitworth,  L.  R.  1  Ex.  D.  36  ;  s.  c.  2  Central  Law  J.  493  and 
note;  s.  c.  afRrmed  3  App.  Cas.  281.  The  insured,  in  a  policy  of  reinsurance, 
means  the  reinsured.  Carrington  v.  Com.  Fire  &  Mar.  Ins.  Co.,  1  Bosw,  (N.  Y. 
Sup'r.  Ct.)  152. 

6  [Bartlett  v.  Fireman's  Fund  Ins.  Co.,  77  la.  155.  The  contract  of  reinsur- 
ance has  been  held  to  be  within  the  Statute  of  Frauds,  as  a  promise  to  pay  the 
debt  of  another.  Egan  v.  Fireman's  Ins.  Co.,  27  La.  An.  368.  But  this  cannot  be 
good  law.    Com.  Mut.  Mar.  Ins.  Co.  v.  Union  Mut.  Ins.  Co.,  19  How.  (U.  S.)  318.] 

7  [Fame  Ins.  Co.'s  Appeal,  83  Pa.  St.  396,  406.] 

22 


CH.  I.]        OF  THE  NATURE  OF  THE  CONTRACT.       [§  12  D 

[§  12  B.  In  an  ordinary  policy  used  in  making  a  contract 
of  reinsurance,  the  conditions  that  no  action  shall  be  main- 
tained until  after  an  award  shall  have  determined  the 
amount  ot  the  claim,  nor  unless  begun  within  twelve  months 
after  loss,  do  not  affect  the  reinsurance.  ^  Where  a  policy 
of  reinsurance  provides  that  it  is  to  be  subject  to  the  same 
risks,  conditions,  privileges,  assignments,  mode  of  settle- 
ment, &c.,  as  are,  or  may  he  assumed  or  adopted  by  the  in- 
surer, the  reinsurer  is  bound  by  the  action  of  the  insurer  in 
assenting  to  an  assignment  of  the  original  policy  to  a  pur- 
chaser at  a  foreclosure  sale.^  Such  an  assent  ought  not  to 
release  the  reinsurer  even  '\x\  the  absence  of  express  provi- 
sion. A  waiver  of  condition  made  by  the  insurer  in  good 
faith,  and  not  increasing  the  burden  of  the  reinsurer,  does 
not  release  the  latter.^] 

[§  12  C.  Where  a  mutual  company  reinsures  all  its  risks, 
and  has  a  surplus  in  the  treasury  consisting  of  cash  pay- 
ments by  present  and  past  policy-holders,  with  interest  from 
the  investment  of  the  same,  this  fund  is  not  properly  dis- 
tributed among  the  policy-holders  at  the  time  of  reinsurance, 
but  must  go  to  all  policy-holders  past  and  present  in  such 
proportion  as  they  contributed  to  create  the  said  fund,  i.  e. 
according  to  the  amount  of  their  respective  payments.^  A 
contract  of  reinsurance  "  on  risks  in  the  State  of  New  York 
and  not  elsewhere  "  does  not  include  policies  issued  in  New 
York  on  property  situated  in  Canada,  or  elsewhere  out  of 
the  State  of  New  York,  although  such  policies  are  sched- 
uled, and  the  reinsurance  policy  refers  to  "the  property 
hereinafter  described  as  per  schedule  annexed "  as  that 
which  is  insured.^] 

[§  12  D.  Where  the  defendant  company  made  a  contract 
to  reinsure  the  plaintiff,  the  policy  purporting  to  be  for  a 
year,  without  stating  when  the  year  began,  and  the  original 

1  [Jackson  v.  St.  Paul  F.  &  M.  Ins.  Co.,  99  N.  Y.  124.] 

2  [Manufacturers'  F.  &  M.  Ins.  Co.  v.  Western  Ass.  Co.,  145  Mass.  419,  424.] 

3  [Fire  Ins.  Ass.  v.  Can.  F.  &  M.  Ins.  Co.,  2  Ont.  R.  481  (assent  of  insurer  to 
mortgage)  ] 

*  [Smith  V.  Hunterdon  County  Mut.  F.  Ins.  Co.,  41  N.  J.  Eq.  473.] 
^  LLondon,  &c.  Ins.  Co.  v.  Lycoming  Ins.  Co.,  105  Pa.  St.  424.) 

23 


§  13]  insurance:  fiee,  life,  accident,  etc.  [ch.  i. 

policy  issued  some  weeks  before  the  reinsurance  was  for  a 
year  from  February  24,  it  was  held  that  the  reinsurance 
covered  the  same  period,  and  the  defendant  was  held  for  a 
loss  within  the  original  policy  although  occurring  before  the 
date  and  issue  of  the  reinsuring  policy,  and  although  the 
latter  did  not  show  on  its  face  that  it  was  a  policy  of  rein- 
surance. Parol  evidence  of  the  facts  of  the  case  is  admis- 
sible to  show  that  the  contract  is  really  one  of  reinsurance, 
and  so  fix  the  date  of  the  beginning  of  the  risk.i  (a)] 

§  13.  Double  Insurance.  —  When  two  or  more  policies  are 
taken  out  upon  the  same  interest,^  it  is  called  double  insur- 
ance. Policies  usually  contain  a  clause  that  in  case  of  other 
insurance,  that  is,  double  insuraxice,  the  several  insurers 
shall  be  liable,  each  for  such  a  proportion  of  the  loss  as  the 
several  amounts  insured  bear  to  each  other.  This  prevents 
the  recovery  of  more  than  the  whole  loss  by  the  insured. 
And  if  there  were  no  such  provision,  since  the  insured  is 
only  entitled  to  an  indemnity,  he  can  recover  no  more  than 
this,  however  much  may  be  the  amount.  He  has  his  elec- 
tion of  two  courses. 3  He  may  sue  each  company  for  its 
proportion,  or  he  may  resort  to  any  one  of  the  insurers  to 
recover  his  whole  loss;  and  in  that  case,  the  insurer  paying 
the  loss  will  have  claims  over  against  the  other  insurers  for 
their  respective  proportions,  the  several  concurrent  insurers 
being  regarded  as  identical  in  interest.*     This  question  of 

1  [Phil.  L.  Ins.  Co.  v.  Am.  L.  &  Health  Ins.  Co.,  23  Pa.  St.  65.] 

2  [Insurance  on  the  interests  of  different  persons,  though  on  the  same  goods, 
is  not  double  insurance.  Wells  v.  Philadelphia  Ins.  Co.,  9  S.  &  R.  103,  107. 
Insurance  by  the  shipper  and  by  the  carrier  is  not  double  insurance,  and  does  not 
entitle  one  company  to  contribution  from  the  other.  Royster  v.  Hoanoke  X.  &  B. 
S.  B.  Co.,  26  Fed.  Rep.  492  (N.  C),  1886.] 

3  [The  assured  may  consider  each  debtor  as  liable  for  a  proportional  share  of 
the  loss,  or  he  may  require  any  one  to  pay  the  whole.  Wiggin  v.  Suffolk  Ins. 
Co.,  18  Pick.  145,  153.] 

*  Gordon  v.  London  Assurance  Co.,  1  Burr.  492  ;  Lucas  v.  Jefferson  Ins.  Co., 
6  Cow.  (N.  Y.)  635  ;  Stacey  v.  Franklin  Fire  Ins.  Co.,  2  W.  &  S.   (Peun.)  506  ; 

(a)  Under  a  usage  by  which  rein snr-  knowledge,  when  there   is  nothing  to 

ance  begins  from  the  date  of  the  rein-  show  the  insurer's  intention  to  give  a 

surance   contract,  the  reinsurer  is  not  retrospective  effect  to  the  reinsurance. 

liable  for  a  loss  which  has  already  oc-  L^'nion  Ins.  Co.  v.  American  F.  Ins.  Co., 

curred  at  that  date  without  either  party's  107  Cal.  327. 


CH.  I.]  OF   THE    NATURE   OF   THE   CONTEACT.  [§13 

double  insurance  will  be  further  and  more  particularly  con- 
sidered when  we  come  to  speak  hereafter  of  conditions  with 
reference  to  other  insurance.  ^ 

Newby  v.  Reed,  1  W.  Black.  416  ;  Peoria  Mar.  &  Fire  Ins.  Co.  v.  Lewis,  18  111. 
553  ;  Baltimore  Fire  Ins.  Co.  v.  Loney,  20  Md.  20  ;  Sloat  v.  Royal  Ins.  Co.,  49 
Pa.  St.  14  ;  Merrick  v.  Germauia  Fire  Ins.  Co.,  54  id.  277  ;  Millaudon  v.  West, 
Mar.  &  Fire  Ins.  Co.,  9  La.  27. 
1  Post,  §  364. 


25 


INSURANCE :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  II. 


CHAPTER  II. 

OF   THE   FORM    OF   THE   CONTRACT   AND   THE   PARTIES   THERETO. 


Analysis, 

1.    Parol  Contracts  (see  ch.  v.  anal.  C). 

§§  14-25.  The  contract  may  be  by  parol  so  as  to  bind  the  company,  although 
usage  requires  writing  (§§  14,  18),  and  even  although  the  charter 
(§§  14,  15,  23)  speaks  of  no  other  than  written  agreements.  If 
the  charter  expressly  prohibits  parol  it  becomes  a  question  in  the 
law  of  ultra  vires  whether  such  a  contract  would  be  good  (see  also 
ch.  iv.  anal.  5,  and  §§  128,  129,  151). 

§  22  A.  The  parol  insurance  usually  made  contemporaneously  with  the  agree- 
ment to  issue  a  policy  remains  in  force  until  the  policy  is  issued  in 
proper  form,  and  the  condition  in  the  policy  that  the  premium  must 
be  paid  before  liability  attaches  does  not  apply  to  the  preliminary 
parol  contract. 
If  no  policy  is  executed  suit  will  lie  on  the  memorandum. 

§  23.  The  terms  of  a  parol  agreement  for  a  policy  are,  in  the  absence  of 

specification,    presumed  to  be  the  same   as   those  of  the  ordinary 
policies  issued  by  the  company  on  similar  risks. 

§  23  A.  A  parol  contract  for  a  policy  will  be  specifically  enforced.  The 
company  will  have  to  pay  for  a  loss  occurring  after  the  agreement 
to  give  a  policy  and  before  its  issue,  unless  it  is  specially  agreed 
otherwise. 

§  23  B.  Sometimes  doubtful  whether  the  agreement  is  one  of  insurance  final, 
or  for  the  issue  of  a  policy,  and  custom  is  competent  evidence.  The 
facts  may  show  only  a  personal  agreement  of  the  agent  to  procure 
insurance. 

§  23  C.  The  statute  of  frauds  does  not  affect  fire-insurance  contracts  even 
though  they  cover  several  years  ;  and  though  a  peril  within  the 
statute  is  included  in  a  fire  contract,  it  is  good  as  a  fire  risk. 

§  23  D.  On  principle  an  oral  contract  of  insurance  intended  to  be  final  is  good, 
as  well  as  a  contract  looking  to  the  issue  of  a  policy,  when  the 
insurer  is  a  private  party  and  no  statute  intervenes.  Corporations, 
however,  have  only  such  powers  as  are  granted  to  them,  and  not, 
as  with  individuals,  all  that  were  not  taken  away  from  them.  The 
first  question  is,  How  far  does  the  law  under  which  the  company 
exists  authorize  it  to  make  oral  contracts  ?  The  second  is,  If  it 
has  exceeded  its  powers,  is  the  contract  void  ?  And  this  depends 
on  the  legislative  intent  which,  when  not  expressed,  is  to  be  judged 
in  the  light  of  the  purpose  of  the  law,  the  persons  for  whose  benefit 
it  was  made,  the  injustice  of  allowing  a  person  to  repudiate  a  con- 
tract and  retain  the  benefit  of  it,  the  propriety  of  protecting  an 
26 


CH.  II.]    FORM  OF  CONTRACT  AND  PARTIES  THERETO. 

innocent  person  who  has  given  value,  and  the  equitable  principle 
that  substance,  not  form,  is  to  be  looked  to.  Mere  informality 
should  not  vitiate  the  contract  unless  the  legislative  inteut  to  that 
effect  is  very  clear. 

§  24.  A  parol  agreement  to  extend  or  modify  a  policy  is  good  even  though 

it  is  under  seal,  and  the  authority  of  agents  to  make  such  oral  agree- 
ments may  be  inferred  from  the  course  of  dealing. 

§  25.  The  rule   in  England  is   doubtful.       It   is  also  a  question  whether 

Congress  can  declare  unstamped  contracts  void,  so  as  to  atfect  them 
in  any  other  than  the  Federal  courts. 

2.     The  Form. 

§  26.  Policies  are  usually  very  lax  and  informal,  but  a  long  course  of  de- 

cisions has  fixed  the  meaning  of  the  terms  in  general  use. 

§  27.  The  form  is  unessential,  but  the  terms  must  be  specified  or  fixed  by 

previous  dealings  or  in  some  other  way.  Signature  of  de  facto 
ofl[icers  suflScient.  Seal  not  necessary  unless  positively  required  by 
the  charter  (see  §§  16,  17).  A  contract  executed  without  seal  by 
mutual  mistake  will  be  reformed.  A  policy  may  be  left  blank  and 
the  names  of  the  insured  filled  in  at  any  time.  The  policy  must 
be  headed  with  the  company's  name  (Pub.  Stats.  720),  and  if  varying 
from  the  standard  form  the  slips,  riders,  &c.,  must  be  signed  by  the 
ofl!icer  or  agent  {Id.  713). 

§  28.  Sometimes  the  wording  is  so  loose  that  it  is  doubtful  if  the  instrument 

contains  any  promise. 

§  29.  The  Policy.     It  is  universal  custom  to  embody  the  terms  of  the  con- 

tract in  a  policy,  specifying  the  names  of  the  parties,  the  premium, 
risk,  time,  subject-matter,  conditions,  and  limitations. 

§  29  A.  What  is  part  of  the  Policy.     The  application,  if  in  writing,  is  made  a 

part  of  the  policy  by  reference  to  it  as  such  in  the  policy,  if  there  is 
no  statute  to  the  contrary.  (See  also  §§  29,  29  C,  31  )  Indorse- 
ments and  marginal  notes  are  part  of  the  policy,  or  not,  according 
to  the  justice  of  the  case  and  the  proper  evidence  of  the  inteut  of 
the  parties. 
§  29  B.  Parol  transactions  prior  to  or  contemporaneous  with  the  policy  and 
not  referred  to  in  it  as  part  of  it  are  superseded  by  it,  and  avail  only 
to  make  a  case  of  misrepresentation  (see  also  §  29  C),  reformation, 
or  non-delivery.  Prospectus. 
§  29  C.        Statutes  sometimes  require  annexation  of  the  application  to  the  policy. 

3.     Kinds  of  Policies. 

§  30.  Valued  and  open  (see  also  §§  31,   32);  wager  and  interest  (§  33); 

time  and  voyage  (§34). 
§  31.  Sometimes  not  easy  to  determine  whether  a  policy  is  valued  or  not. 

A  valuation  in  the  application  referred  to  in  the  policy  is  sufficient. 

The  contract  is  not  less  a  valued  one  because  the  rule  fixed  on  by 

the  parties  admits  of  variation  day  by  day. 
§  31  A.         Statutes  declaring  that  policies  on  real  estate  shall  be  deemed  valued 

policies  in  case  of  total  loss. 
§  32.  The  same  policy  may  be  open  as  to  one  article   and   valued  as   to 

another. 

27 


§  14]     "      insurance:  fire,  life,  accident,  etc.         [CH.  II. 

§  33.  Wager  and  interest  policies  (see  §  74). 

§  34.  Time  and  voyage  policies. 

4.  Parties  and  their  Disabilities.     (See  also  next  chapter.) 
R  35  Private  parties  able  to  contract  generally,  and  corporations  established 

for  the  purpose  may  be  parties  to  the  contract  of  insurance. 
§  35  A.        Infants.     Unlicensed  merchants.     Parties  joining. 

§  14.  Contract  may  be  by  Parol.  —  However  great  may  be 
the  inconvenience  to  the  parties,  and  however  injudicious  it 
may  be  to  leave  the  terms  of  the  contract  to  the  uncertain- 
ties of  even  the  most  accurate  and  retentive  memory,  :t 
seems,  nevertheless,  that  a  contract  of  insurance,  the  terms 
of  which  are  not  in  writing,  is  sufficient  to  bind  the  parties, 
when  there  is  no  statute  law  to  th^.  contrary,  (a) 

A  learned  writer, i  indeed,  doubts  whether  an  action  upon 
a  contract  merely  oral  would  be  now  sustained,  since  the 
usage  of  written  contracts  has  become  so  ancient  and  so  uni- 
versal that  it  may  be  considered  to  have  acquired  the  force 
of  law.  And  this  view  seems  to  have  been  adopted  to  its 
full  extent  by  the  Supreme  Court  of  Ohio,^  as  well  upon  the 
ground  of  (what  was  said  to  be)  universal  commercial  usage 
and  the  authority  of  the  books,  as  upon  the  ground  that  the 
charter  required  the  policy  to  be  in  writing,  —  the  question 
being  whether  a  policy,  which  had  become  void  by  the  sale 

1  1  Duer,  Ins.  60. 

•2  Cockerill  v.  Cincinnati  Mut.  Ins.  Co.,  16  Ohio,  148.     See  §  18. 

(a)    Brown  v.  Franklin  Mut.  F.  Ins.  Mass.  341.     An  oral  agreement  to  insure 

Co.,   165  Mass.   565  ;    Stehlick  v.  Mil-  for  a  longer  period  than  that  stated  in 

waukee  Mechanics'   Ins.  Co.,   87  Wis.  the  contract  will  not  be^nforced  in  the 

322  ;  Hicks  v.   British  Am.    Ins.   Co.,  absence  of  a  consideration  ;  and  if  the 

43   N.  Y.  S.  623  ;  Phoenix   Ins.  Co.  v.  intention  is  to  contract  in  writing  upon 

Ireland  (Kans.  App.),  58   Pac.    1024;  payment  of  the  premium,  negotiations 

Fidelity    &    Gas.    Ins.    Co.  v.    Ballard  for  insurance  do  not  constitute  a  con- 

(Ky.),  28  Ins.  L.  J.  227.    In  order  that  tract.     New  York  L.  Ins.  Co.  v.  ]\IcMas- 

a  contract  of  insurance  may  bind  the  ter,  87  Fed.   Rep.  63 ;  90  id.  40.     See 

parties,  all  the  essential  elements  of  the  Bankers'    Ace.    Ins.    Co.  v.  Rogers,   73 

contract   must  be   agreed  upon  ;    but,  Minn.  12.     Parol  insurance  with  an  au- 

when  it  is  impossible  at  the  time  to  thorized  agent  is  valid  and  becomes  at 

obtain  important  facts  affecting  the  sub-  once  effective  when  there  is  no  definite 

ject  of  their  dealings,  the  parties  may  agreement  as  to  date.    Potter  v.  Phenix 

make  a  general  agreement  to  accomplish  Ins.  Co.,  63  Fed.  Rep.  382  ;  Hardwick 

their    purpose    as   well    as    they   can.  v.  State  Ins.  Co.,  20  Oregon,  547,  551. 
Scammell  v.  China  Mutual  Ins.  Co.,  164 

28 


GH,  II.]         FORM    OF   CONTRACT   AND    PARTIES    THERETO.  [§15 

of  the  property  insured,  could  be  revived  by  a  parol  agree- 
ment. But  upon  neither  ground  is  the  decision  supported 
by  the  authorities.  Indeed,  it  seems  to  be  no  longer  an 
authority  in  Ohio  itself. ^ 

§  15.  Special  Provisions  of  Charter  as  to  Form.  —  It  is 
doubtless  generally  true  that  a  corporation  cannot  by  its 
own  act  enlarge  its  own  capacities,  powers,  or  rights ;  hut 
it  would  be  strange  to  say  that  it  cannot  thus  voluntarily 
incur  liabilities.  If  a  corporation  by  a  corporate  act  appoints 
an  agent  under  any  name  or  title  "whatever,  for  the  purpose 
of  making,  in  its  own  behalf,  any  contract  which  it  has  a 
right  to  make,  can  the  corporation  itself  impeach  such  a 
contract,  made  in  its  name  by  that  agent,  by  alleging  its 
own  want  of  power  to  make  such  an  appointment,  or  to  con- 
tract by  such  an  agent?  Such  a  doctrine  is  in  violation  of 
all  principle.  2 

Even  an  express  provision  in  the  act  of  incorporation  that 
policies  subscribed  by  the  president  and  countersigned  by 
the  secretary,  or  however  else,  shall  be  binding  on  the  cor- 
poration, merely  specifies  one  sufficient  mode  of  making  the 
contract,  and  affords  no  just  inference  that  this  mode  is 
exclusive  of  others,  or  that  contracts  not  in  writing  are 
invalid.^ 

1  Dayton  Ins.  Co.  v.  Kelly,  24  Ohio  St.  345.  This  case  holds  that  the  pro- 
visions of  a  charter  requiring  "all  policies  and  contracts "  for  insurance  to  be 
signed  by  the  president  does  not  have  reference  to  intermediary  contracts  for 
policies,  but  only  to  the  final  contract  or  policy. 

2  Bulkley  v.  The  Derby  Fishing  Co.,  2  Conn.  252,  254.  And  see  also  Fuller  v, 
Boston  Mut.  Fire  Ins.  Co.,  4  Met.  (Mass.)  206 ;  State  Board  of  Agriculture  v.  R. 
R.  Co.,  47  Ind.  407;  Angell  on  Corp.  (10th  ed.)  243  ;  National  Bank  v.  Graham, 
100  U.  S.  699  ;  New  England  Fire  &  Mar.  Ins.  Co.  v.  Schettler,  38  111.  166. 

3  Trustees  of  First  Baptist  Church  in  Brooklyn  v.  Brooklyn  Fire  Ins.  Co., 
19  N.  Y.  (5  Smith)  305  ;  Constant  v.  The  Alleghany  Ins.  Co",  3  Wall.  (U,  S. 
C.  C.)  313  ;  s.  c.  Am.  Law  Reg.  N.  s.  1,  116.  See  also  New  England  Mut.  Ins. 
Co.  V.  De  Wolf,  8  Pick.  (Mass. )  56,  62  ;  City  of  Davenport  v.  Peoria  Mar.  &  Fire 
Ins.  Co.,  17  Iowa,  276  ;  Franklin  F.  Ins.  Co.  v.  Colt,  20  Wall.  (U.  S.)  560 ;  s.  c. 
4  Ins.  L.  J.  367  and  note,  which  holds  that  an  agent  may,  after  loss,  iill  upon 
demand  a  policy  in  accordance  with  the  agent's  parol  agreement ;  New  Eng- 
land Fire  &  Mar.  Ins.  Co.  v.  Schettler,  38  111.  166  ;  Security  Fire  Ins.  Co.  v. 
Kentucky  Mar.  &  Fire  Ins.  Co.,  7  Bush  (Ky.),  81  ;  Hening  v.  United  States  Ins. 
Co.,  2  Dillon,  C.  Ct.  26,  denying  s.  c.  47  Mo.  430  ;  post,  §§  16,  23.  But  see  contra, 
post,  §  63.  That  the  current  of  foreign  authorities  is  in  the  same  direction,  see 
posf,  §§20,  21.     In   Lower  Canada  it  has  been  held  that  the  mode  specified  in 

29 


§  17]  insurance:   fike,  life,  accident,  etc.  [CH.  II. 

§  16.  The  ancient  stringency  of  the  common  law  required 
that  corporations  should  execute  their  contracts  under  their 
corporate  seal,  and  held,  that  they  could  only  thus  con- 
tract But  this  doctrine  is  now  exploded. ^  (a)  The  statu- 
tory provisions  referred  to  would  seem  to  intend  rather  to 
give  to  the  modern  doctrine  the  force  of  legislative  sanction, 
than  to  preclude  the  corporation  from  the  right  to  contract 
under  the  corporate  seal,  if  they  please,  or  to  designate  any 
particular  mode  which  alone  shall  be  binding  upon  them.^ 
(s)  The  insured  is  also  thereby  relieved  from  the  necessity 
of  proving  affirmatively  that  the  particular  officers  are 
clothed  with  power  which  authorizes  them  to  contract  for 
the  corporation.^ 

§  17,  And  such,  no  doubt,  is  the  spirit  of  the  later  Eng- 
lish cases.  In  Prince  of  Wales  Life  and  Educational  Assur- 
ance Company  v.  Harding,*  which  was  a  case  where  the 
charter  provided  that  the  seal  of  the  company  should  not  be 
affixed  to  policies  except  by  the  written  order  of  three  direc- 

the  charter  is  exclusive.  Montreal  Ins.  Co.  v.  McGillivray,  9  L.  C.  488,  revers- 
ing s.  c.  8  id.  401  ;  while  in  Upper  Canada  it  was  held  that,  although  under  a 
clause  in  the  charter  which  provided  that  "  any  policy  signed  hy  the  president 
and  countersigned  by  the  secretary,  but  not  otherwise,  shall  be  deemed  valid  and 
binding  on  the  company,"  a  policy  issued  without  the  signatures  was  invalid, 
and  the  company  would  not  be  liable  in  a  suit  upon  such  a  policy,  yet  they 
could  be  compelled  to  execute  a  valid  policy  as  of  the  date  when  this  invalid 
policy  was  issued.  Perry  v.  Newcastle  DLst.  Mut.  Fire  Ins.  Co.,  8  U.  C.  (Q.  B.) 
363.     See  also  post,  §  23  et  seq. 

1  2  Kent's  Com.  288  ;  Bank  of  Columbia  v.  Patterson,  7  Cranch,  299  ;  Hamil- 
ton V.  Lycoming  Mut.  Ins.  Co.,  5  Barr  (Pa.),  339  ;  s.  c.  10  Law  Reporter,  448  ; 
Copper  Miners  v.  Fox,  3  Eng.  Law  &  Eq.  420. 

2  [When  the  charter  of  a  company  jn'ovides  that  all  policies  shall  be  under 
seal,  a  policy  not  under  seal  cannot  be  produced  as  evidence  in  a  suit  by  the 
company  to  recover  the  premium  on  it.  Lindauer  v.  Delaware  Mut.  Safety  Ins. 
Co.,  13  Ark.  461,  470.] 

8  Safford  V.  Wyckoif,  4  Hill,  442,  446,  Walworth,  Oh. 
*  1  E.,  B.  &  E.  183. 

(a)    In  England   it  was  early  held  the  insurer's  corporate  seal,  an  emblem 

that  a  policy  of   insurance    is  not  a  or  symbol  printed  there  by  tlie  printer, 

specialty.     2   Saund.    202  a,  n.    (15).  Met'n  L.  Ins.  Co.  v.  Anderson,  79  Md. 

Policies    not    declared    on    as    sealed  375,    379.      In   Massachusetts  the  fac- 

instruments,  and  merely  reciting  that  simile   of  a   seal   printed   on   a  blank 

they  were  signed  and  delivered  by  the  policy  form  does  not  make  the  policy  a 

officers,  will  not  be  treated  as  specialties  sealed  instrument.     McCarthy  v.  Met'n 

simply  because  they  have,  iu  place  of  L.  Ins.  Co.,  162  Mass.  254. 

30 


CH.  II.]         FOEM    OF    CONTRACT   AND    PARTIES   THERETO.  [§  19 

tors,  a  policy  issued  under  seal,  but  without  any  order  of 
the  directors,  was  held  to  be  valid  and  binding  upon  the 
company,  for  reasons  substantially  the  same  as  those  given 
in  the  American  decisions.  The  object  of  the  legislature 
was  said  to  be  to  impose  upon  the  directors  the  duty  towards 
them  of  observing  certain  formalities,  for  the  better  protec- 
tion of  the  stockholders.  If  they  failed  in  that  duty,  they 
would  be  liable  for  their  negligence  to  the  stockholders,  but 
the  absence  of  the  prescribed  formality  would  not  render  the 
contract  void  as  against  the  company.  ^  So,  where  the  policy 
is  by  the  charter  required  to  be  under  seal,  a  policy  issued 
without  a  seal  may  be  construed  as  an  interim  receipt.  2  An 
indorsement  not  under  seal  on  a  policy  under  seal  is  a  new 
contract.^ 

§  18.  But  corporations  are  not  the  only  underwriters. 
Private  individuals  may  insure ;  and  if  a  party,  for  a  good 
consideration,  should  take  upon  himself  the  risk  of  theft 
upon  a  quantity  of  specie  in  its  passage  from  one  port  to 
another,  and  it  should  be  stolen,  a  court  of  justice  would 
doubtless  hesitate  long  before  it  would  sustain  the  defend- 
ant's refusal  to  indemnify,  on  the  ground  that  the  contract 
was  merely  oral,  against  the  irresistible  equity  of  the  plain- 
tiff's claim.  Usage,  it  is  said,  requires  it.  But,  aside  from 
the  fact  that  usage  may  be  waived  by  the  consent  of  parties, 
its  requisitions  cannot  be  said  to  be  so  inexorable  as  virtu- 
ally to  import  a  new  clause  into  the  Statute  of  Frauds.^ 

§  19.    It  is  not  denied  that  by  the  principles  of  the  com- 

1  See  also  Collett  v.  Morrison,  9  Hare,  162. 

2  Wright  V.  London  Life  Ass.  Co.,  Wright  v.  Sun  Mut.  Life  Ins.  Co.,  29  U.  C. 
(C.  P.)  221,  carried  to  the  Supreme  Court  on  appeaL 

8  Shertzer  v.  Mut.  Fire  Ins.  Co.,  46  Md.  506  ;  s.  c.  8  Ins.  L.  J.  72. 

*  Even  the  Supreme  Court  of  Ohio,  although  it  has  several  times  referred  to 
the  case  of  Cockerill  v.  Cincinnati  Mut.  Ins.  Co.,  16  Ohio,  148,  with  apparent 
approval,  has,  in  a  later  case  (Palm  v.  Medina  Ins.  Co.,  20  Ohio,  529),  apparently 
taken  it  for  granted  that  a  contract  to  insure  need  not  be  in  writing.  See  also 
ante,  §  15  n.  A  contract  for  parol  insurance  for  a  year,  or  from  year  to  year,  is 
not  within  the  Statutes  of  Frauds.  Walker  r.  Metropolitan  Ins.  Co.,  56  Me.  371  ; 
Trustees  of  First  Baptist  Church  in  Brooklyn  v.  Brooklyn  Fire  Ins.  Co.,  19  N.  Y. 
(5  Smith)  305,  308  ;  Sanborn  v.  Fireman's  Ins.  Co.,  16  Gray  (Mass.),  448  ;  Fish  v. 
Cottenet,  5  Hand.  (N.  Y.)  538 ;  Security  Fire  lus.  Co.  v.  Kentucky  Mar.  &  Fire 
Ins.  Co.,  7  Bush  (Ky.),  81. 

31 


§  20]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  II. 

moil  law  a  verbal  agreement  would  be  sufficient;  and  it 
seems  difficult  to  see  why  a  party,  in  the  absence  of  any 
statutory  regulations  to  the  contrary,  may  not  be  heard  in  a 
court  which  administers  the  law  to  which  he  appeals,  and 
which  can  find  nothing  in  its  principles  adverse  to  his  claim. 
It  was  accordingly  said,  in  McCuUoch  v.  The  Eagle  Insur- 
ance Company,!  to  be  certain  that  if  a  contract  be  made,  the 
mere  want  of  a  policy  will  not  prevent  the  plaintiif  from 
recovering.  And  more  recently,  Mr.  Chancellor  Walworth, 
after  remarking  that  the  Stamp  Laws  in  England,  and  the 
respective  Codes  of  France  and  Spain,  require  that  the  con- 
tract be  in  writing,  observed, ^  that  the  assertion  of  Millar  ^ 
that  the  importance  of  the  contract  of  insurance,  and  the 
singularity  of  those  obligations  which  it  is  intended  to  cre- 
ate, have  in  all  commercial  countries  rendered  a  deed  in 
writing  essential  to  its  validity,  is  unsupported  by  authority, 
and  that  he  has  been  unable  to  find  anything  in  the  common 
law  which  requires  the  contract  to  be  in  writing,  though  the 
term  "policy"  undoubtedly  imported  a  written  instrument. 

§  20.  Nor  even  in  France,  although  the  Code  de  Commerce 
requires  that  the  contract  be  reduced  to  writing,  would  a 
verbal  agreement  be  ipso  facto  null  and  void.  Any  written 
evidence  that  an  agreement  has  been  made  will  let  in  the 
plaintiff  to  show  what  the  contract  is;  and  even  this  is  not 
necessary  unless  the  defendant  deny  that  there  ever  was  any 
agreement  of  any  kind.*  And  if  he  do  deny,  the  better 
opinion  is  that  he  may  be  put  upon  his  oath;^  which,  how- 
ever, Emerigon  does  not  admit.  ^ 

1  1  Pick.  (Mass.)  278. 

2  Saiidford  v.  Trust  Fire  Ins.  Co.,  11  Paige  (N.  Y.),  547.  See  also  Hamilton 
V.  Lycoming  Mut.  Ins.  Co.,  5  Barr  (Pa.),  339,  s.  c.  10  Law  Reporter,  498,  where 
Gibson,  C.  J.,  said  that  a  few  years  before  a  case  was  tried  before  him  on  a 
parol  agreement,  and  though  the  case  was  defended  by  one  of  the  soundest 
lawyers  at  the  Philadelphia  bar,  the  point  that  the  contract  should  be  in  writing 
was  not  made.     As  to  the  effect  of  the  Stamp  Laws,  see  post,  %  25. 

8  Ins.  30. 

*  Kogron,  Code  de  Commerce  Explique,  art.  332,  note  ;  Alauzet,  Traite  G4n. 
des  Assurances,  181,  401,  who  cites  Potier,  Merlin,  and  others. 

5  Ibid. 

8  Traite  des  Assurances,  c.  2,  §  1.  In  Holland  the  doctrines  of  fire,  marine, 
and  other  insurance  have  been  incorporated  into  the  Commercial  Code.     The 

32 


CH.  II.]         FOItM    OF   COXTRACT    AND   PARTIES   THERETO,  [§  21 

"Writing  cannot  be  regarded,"  says  Alauzet,^  "as  neces- 
sary to  tlie  validity  of  the  contract  of  insurance."  "This 
form,"  says  Pothier,  "is  absolutely  foreign  to  the  substance 
of  the  contract."  And  Merlin  afterwards  held  it  to  be  clear 
that  writing  was  only  necessary  to  establish  the  existence  of 
the  contract  against  those  who  would  deny  it.  The  law,  in 
truth,  cannot  change  the  essence  of  a  contract  which  it  has 
not  created,  and  which  exists  independently  of  it,  because  it 
is  of  the  law  of  nations.  But  it  is  entirely  competent  to 
our  law  to  regulate  the  conditions  necessary  to  the  proof  of 
the  contract;  and  under  this  relation  it  becomes  a  contract 
subject  thereto.  To  say,  however,  that  insurance  itself  shall 
have  no  existence  except  under  these  conditions,  and  that 
one  of  the  parties  may  admit  all  the  allegations  of  the  other, 
and  yet  refuse  to  comply  with  the  terms  of  the  contract  be- 
cause it  is  not  in  writing,  would  be  to  establish  an  abuse 
against  truth  and  the  nature  of  things.  The  Code  de  Com- 
merce is  far  from  containing  any  such  provision ;  and  always 
when  it  has  made  any  requirement  on  pain  of  nullity,  it  has 
expressly  said  so.  It  is  well  known  what  chaos  has  been 
introduced  into  another  branch  of  the  law  by  the  technical 
distinction  between  forms  which  are  substantial  and  those 
which  are  not ;  between  those  prescribed  on  pain  of  nullity 
and  those  which  are  only  directory.  Nothing  of  the  like 
exists  in  commercial  law.  If  the  Code  does  not  pronounce 
nullity  expressly,  clearly,  and  in  a  peremptory  manner,  it 
cannot  be  invoked.  In  such  cases  equivalents  may  be  sub- 
stituted for  its  prescriptions. 

§  21.    It  was  said,  in  the  Trustees  of  the  First  Baptist 

twelfth  article  of  Title  9,  the  2o7th  of  the  Code,  is  as  follows  :  "  The  contract  of 
insurance  subsists  as  soon  as  the  agreement  has  been  determined  between  the 
parties,  and  the  reciprocal  rights  and  obligations  of  the  insurers  and  the  insured 
commence  from  that  moment,  even  before  the  signature  of  the  policy.  The 
contract  imports  the  obligation  of  the  insurers  to  sign  the  policy  within  the  time 
agreed  upon  and  deliver  it  to  the  insured."  Rogron,  Code  de  Commerce  Ex- 
plique,  p.  245.  Le  Guidon,  art.  11,  c.  1,  speaks  of  parol  agreements  to  insure, 
and  prohibits  them. 

1  Ubi  supra.  The  whole  subject  is  discussed  with  great  abilit}',  and  all  the 
learning  up  to  that  time,  in  Montreal  Ins.  Co.  v.  McGillivray,  9  L.  C.  (Q.  B.) 
488,  reversing  s.  c.  8  id.  401. 

VOL.  I.  —  3  33 


insurance:  fire,  life,  accident,  etc. 


[CH.  II. 


§51] 

Society  in  Brooklyn  v.  Brooklyn  Fire  Insurance  Company, 
that  an  agreement  that  an  existing  policy  for  a  year  should 
be  in  existence  from  year  to  year  after  its  expiration  may 
be  by  parol,  and  yet  be  valid,  as  the  reasons  which  require 
policies  to  be  in  writing  do  not  apply  to  such  an  agree- 
ment.^ (a)  What  these  reasons  are  do  not  appear  in  the 
opinion  of  the  court,  and  it  may  well  be  doubted  if  any  dis- 
tinction like  that  so  intimated  does  in  fact  exist.  And  the 
New  York  Court  of  Appeals, ^  although  the  case  before  it  was 
rather  one  of  the  renewal  of  a  contract,  the  terms  of  which 
were  fixed  in  writing,  than  the  making  of  a  new  one,  has 
recently  broadly  asserted,  that  "to  deny  that  parol  agree- 
ments to  insure  are  valid  would  be  simply  to  affirm  the  in- 
capacity of  parties  to  contract,  when  no  such  incapacity 
exists  according  to  any  known  rule  of  reason  or  of  law." 

1  18  Barb.  (N.  Y.)  69. 

2  Trustees  of  the  First  Baptist  Church  y.  Brooklyn  Fire  Ins.  Co.,  19  N.  Y.  305. 

V.  Heywood,  74  L.  T.  781.  In  this 
country  it  has  been  held  that  a  policy 
of  life  insurance  providing  for  the  pay- 
ment of  annual  premiums  by  the  as- 
sured is  not  a  contract  for  one  year,  with 
the  privilege  of  renewal  from  year  to 
year  by  the  payment  of  the  premiums, 
but  a  contract  for  the  life  of  the  as- 
sured, subject  to  forfeiture  and  ter- 
mination for  non-performance  of  its 
conditions ;  and  it  is  incumbent  on 
the  party  pleading  such  forfeiture  to 
clearly  establish  the  defence.  McMas- 
ter  V.  New  York  L.  Inp.  Co.,  90  Fed. 
Rep.  40.  See  Klein  t>.  Liverpool,  &c. 
Ins.  Co.  (Ky.),  57  S.  AV.  250.  A  lapsed 
policy  is  not  revived,  if  a  warranty  con- 
tained in  tlie  application  for  revival  is 
untrue.  Bottomley  v.  Met'n  L.  Ins. 
Co.,  170  Mass.  274.  See  Burson  v. 
Phila.  Fire  Ass'n,  136  Penn.  St.  267. 

A  new  substituted  policy  which  is 
void  for  non-compliance  with  a  statute 
cannot  be  validated  by  relying  upon  the 
preliminary  oral  agreement,  which  is 
presumed  to  be  similar  thereto.  Green 
V.  Liverpool,  &c.  Ins.  Co.,  91  Iowa, 
615. 


(a)  An  existing  policy  may  also  be 
renewed  by  parol.  Springer  v.  Anglo- 
Nevada  Ass.  Corp.,  11  N.  Y.  S.  533  ; 
Scott  V.  Home  Ins.  Co.,  53  Wis.  238  ; 
McCabe  v.  Mtna  Ins.  Co.  (No.  Dak.), 
81  N.  W.  T.  26  ;  Baldwin  v.  Phrenix 
Ins.  Co.  (Ky.),  54  S.  W.  13  ;  Western 
Ass.  Co.  V.  McAlpin  (Ind.  App.),  55 
N.  E.  119.  In  an  oral  contract  "tore- 
new  his  insurance  for  one  year,"  by 
force  of  the  term  "renew,"  "the  com- 
pany, as  well  as  the  property  to  be  in- 
sured, and  the  terms  of  the  policy,  were 
sufficiently  designated."  Abel  v.  Phce- 
nix  Ins.  Co.,  62  N.  Y.  S.  218.  A  parol 
agreement,  terminable  at  any  time  upon 
notice  to  either  party,  that  a  fire  insur- 
ance policy  shall  be  renewed  from  year  to 
year,  is  not  within  the  statute  of  frauds. 
Phcenix  Ins.  Co.  v.  Ireland  (Kans.  Apj).), 
58  Pac.  1024.  In  England  it  has  recently 
been  held  that  an  accident  policy  which 
provides  for  the  payment  of  a  premium 
for  one  year,  and  which  is  capable  of 
renewal  only  by  the  insurer's  consent, 
is  not  a  continuing  policy  for  all  pur- 
poses, but,  upon  each  renewal,  there  is 
a  new  contract  year  by  year.     Stok"ll 

34 


CH.  II.]  FOEM    OF   CONTRACT   AND    PARTIES    TIIEUETO.       [§  22  A 

The  distinction  above  referred  to,  suggested  by  the  court 
below  in  the  same  case,  seems  to  have  been  disregarded. 

§  22.  The  cases  already  cited  are  strictly  cases  of  agree- 
ments looking  to  the  issue  of  a  policy  ;  and  most  of  the  terms 
of  the  several  agreements  are  in  some  form  in  writing.  But 
the  case  of  the  Mobile  Marine  Dock  and  Mutual  Insurance 
Company  ^  was  less  embarrassed  by  written  evidence  of  any 
kind.  In  this  case  there  was  a  simple  memorandum  in  fig- 
ures,2  alleged  to  be  in  the  handwriting  of  the  secretary  of 
the  insurance  company,  and  the  offer  was  to  show  by  this 
and  oral  evidence  that  a  contract  of  insurance  against  fire 
was  made  between  the  parties.  The  insurers  objected  that 
both  the  memorandum  and  the  oral  evidence  were  inadmis- 
sible, on  the  ground  that  it  was  not  competent  by  parol  evi- 
dence to  establish  a  contract  of  insurance.  But  the  court 
held  that  an  oral  agreement  for  insurance  against  loss  on 
goods  by  fire  was  valid. 

§  22  A.  A  parol  agreement  may  be  made  by  an  agent,  and 
takes  effect  forthwith,  although  entered  into  contemporane- 
ously with  an  agreement  by  the  insurers  to  deliver,  and  the 
insured  to  accept  and  pay  for,  as  a  substitute  therefor,  a 
policy  in  writing  in  the  usual  form,  and  remains  in  force  till 
the  delivery  or  tender  of  such  policy.  Until  then  the  condi- 
tion usually  inserted  in  such  policies,  making  prepayment  of 
the  premium  necessary  to  the  validity  of  the  contract,  has 
been  held  to  have  no  operation  by  implication.^  Nor  will  a 
mere  demand  of  the  premium,  without  a  tender  of  the  pol- 
icy, relieve  the  insurers  from  responsibility  under  such  parol 
agreement;*  and  under  it  the  insured  may  recover,  although 
he  may  have  received  a  policy,  in  pursuance  of  the  agree- 
ment,  if  by   its  terms  such  policy  becomes  valid  only  on 

1  31  Ala.  711. 

^  This  memorandum  was  as  follows  :  — 

"  5250     .     .     7  d'ys     .     .     1-8     .     .     6.56 
4650     .     .     2    "        .     .     1-20  .     .     2.32 

9900.  3-16  to  N.  0.  18.56 —|27. 44." 

3  Kelly  V.  Com.  Ins.   Co.,  10  Bosw.  (N.  Y.)  82;  Dayton  Ins.  Co.  v.  Kelly,  24 
Ohio  St.  345.     See  also  post,  §§  23,  44,  340. 
*  Kelly  V.  Com.  Ins.  Co.,  supra. 

35 


§  23]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,    ETC.  [CH.  II. 

being  countersigned  by  the  agent,  and  in  fact  has  not  been 
so  countersigned.  1  [If  no  policy  is  executed  a  suit  can  be 
maintained  on  the  memorandum. ^  A  parol  contract  of  in- 
surance is  good  though  nothing  is  said  about  the  premium, 
where  the  parties  have  dealt  together  for  several  years  and 
know  the  rate  of  premium,  and  the  agents  have  been  in  the 
habit  of  giving  the  plaintiff  credit  for  the  premium. s]  And 
the  rule  of  damages  is  the  same  as  under  a  written  policy.* 
But  if  a  policy  has  once  been  delivered  which  proves  to  be 
invalid  by  the  fault  of  the  insured,  he  cannot  disregard  that, 
and  fall  back  upon  the  verbal  agreement.^ 

§  23.  In  the  case  of  Sanborn  et  al.  v.  Fireman's  Insurance 
Company,^  the  point  was  again  distinctly  made  that  the  con- 
tract of  insurance  is  required  to  be  in  writing,  and  that  a 
suit  at  law  is  not  maintainable  on  an  oral  agreement.  After 
elaborate  consideration,  in  which  all  the  authorities  were 
reviewed,  the  conclusion  to  which  the  court  arrived  was, 
that  no  principle  of  the  common  law  requires  that  this  con- 
tract, any  more  than  any  other  simple  contract,  made  by 
competent  persons  upon  a  sufficient  consideration,  should  be 
evidenced  by  a  writing.  And  the  oral  agreement  was  up- 
held, although  the  charter  of  the  defendant  company  pro- 
vided that  they  should  have  a  right  to  make  contracts  by 
the  signature  of  the  president  for  the  time  being,  or  by  the 

^  Kellj'  V.  Com.  Ins.  Co.,  supra. 

2  [State  F.  &  M.  Ins.  Co.  v.  Porter,  3  Grant's  Cas.  123] 

8  [Boice  V.  Thames,  &c.  Marine  Ins.  Co.,  38  Hun,  246.] 

*  Rockwell  V.  Hartford  Fire  Ins.  Co.,  4  Abb.  Pr.  Rep.  (N.  Y.)  179  ;  Ins.  Co. 
V.  Ins.  Co.,  19  How.  (U.  S.)  318;  Ellis  v.  Ins.  Co.,  50  N.  Y-  402.  In  Ela  v. 
French,  11  N.  H.  356,  an  action  against  a  consignee  on  a  parol  agreement  to  in- 
sure certain  books,  without  any  agreement  as  to  the  amount,  was  sustained,  the 
rule  of  damages  being  the  value  of  the  books,  on  the  presumption  that  the  in- 
surance was  to  be  for  that  value. 

5  Merchants'  Mut.  Ins.  Co.  v.  Lj'man,  15  Wall.  (U.  S.)  664. 

«  16  Gray  (Mass.),  448,  decided  in  1860,  but  not  published  till  1871.  Ap- 
proved and  followed  in  Relief  Fire  Ins.  Co.  v.  Shaw,  4  Otto  (U.  S.),  574.  See  also, 
to  the  same  point,  Westchester  Fire  Ins.  Co.  v.  Earle,  33  Mich.  143;  Humphrey 
V.  Hartford  Fire  Ins.  Co.,  Dist.  Ct.,  9  Reptr.  106  ;  Alabama  Gold  Life  Ins.  Co.  v. 
Mayes  (Ala. ),  9  Reptr.  75  ;  Taylor  v.  Germania  Ins.  Co.,  2  Dill.  C.  Ct.  282  ; 
Baubie  v.  yEtna  Ins.  Co.,  id.  156  ;  Hartford  Fire  Ins.  Co.  v.  Farrish,  73  111.  166; 
Franklin  Fire  Ins.  Co.  v.  Taylor,  52  Miss.  441  ;  Northrup  v.  Mississippi  Valley 
Ins  Co.,  47  Mo.  435. 
36 


CH.  II.]    FORM  OF  CONTRACT  AND  PARTIES  THERETO.     [§  23 

signatures  of  such  other  persons,  and  in  such  form  and  with 
such  ceremonies  of  authentication  as  they  may  by  their  rules 
and  by-laws  direct,  the  court  regarding  this  provision  of 
their  charter  as  merely  enabling,  and  not  restrictive  of  the 
general  power  to  effect  contracts  in  any  other  lawful  and 
convenient  mode,  — a  view  which  must  now  be  considered  as 
the  well-settled  doctrine  by  the  nearly  universal  concurrence 
of  the  authorities.  The  distinction  between  a  contract  to 
insure  or  to  issue  a  policy  of  insurance,  and  the  policy  itself, 
is  obvious,  and  constantly  recognized  by  the  courts.  The 
former  may  be  by  parol  or  in  any  form.  The  latter  may  be 
regulated  and  controlled  by  statutes  or  by  the  by-laws  of  the 
company  issuing  it.^  The  terms  of  the  agreement  for  a  pol- 
icy not  specified  are  presumed  to  be  those  of  the  ordinary 
policies  issued  by  the  same  insurers  on  similar  risks. ^  It 
is  obvious,  however,  that  conditions  as  to  indorsement  can- 
not be  complied  with.  In  such  cases  notice  will  be  suffi- 
cient.^ And  perhaps  not  even  that  is  necessary,  as  the 
contract  may  be  one  for  a  policy  upon  which  shall  be  made 
the  indorsements  and  the  notices  required  by  the  conditions.^ 

^  Rhodes  v.  Railway  Passenger  Ins.  Co.,  5  Lans.  (N.  Y.),  71  ;  Walker  v.  Metro- 
politan Ins.  Co.,  56  Me.  371  ;  Post  v.  Mixia.  Ins.  Co.,  43  Barb.  (N.  Y.)  351  ;  Ken- 
nebec Co.  V.  Augusta  Ins.  &  Banking  Co.,  6  Gray  (Mass.),  204;  Baxter  v. 
Massasoit  Ins.  Co.,  13  Allen  (Mass.),  320  ;  Audubon  v.  Excelsior  Ins.  Co.,  27 
N.  Y.  216  ;  Western  Massachusetts  Ins.  Co.  v.  Duffey,  2  Kan.  347  ;  Union  Mut. 
Ins.  Co.  V.  Commercial  Mut.  Mar.  Ins.  Co.,  2  Curtis,  C.  Ct.  524  ;  s.  c.  affirmed 
in  the  United  States  Supreme  Court,  19  How.  318  ;  Security  Fire  Ins.  Co.  v. 
Kentucky  Mar.  &  Fire  Ins.  Co.,  7  Bush  (Ky.),  81  ;  Hartford  Ins.  Co.  v.  Wilcox, 
57  111.  180  ;  Insurance  Co.  v.  Colt,  20  Wall.  (U.  S.)  560  ;  ante,  §  15;  Putnam  v. 
Home  Ins.  Co.,  123  Mass.  324,  328. 

2  Eureka  Ins.  Co.  v.  Robinson,  56  Pa.  St.  256  ;  Hubbard  v.  Hartford  Fire 
Ins.  Co.,  33  Iowa,  325 ;  Oliver  v.  Mut.  Com.  Mar.  Ins.  Co.,  2  Curtis,  C.  Ct.  277  ; 
Fuller  V.  Madison  Ins.  Co.,  36  Wis.  509  ;  (F.  P.)  Barre  v.  Council  Bluffs  Ins. 
Co.,  76  la.  609  ;  Smith  v.  State  Ins.  Co.,  64  la.  716.  A  company  will  be  pre- 
sumed to  intend  to  issue  its  customary  kind  of  policy  in  the  absence  of  any  aver- 
ment and  proof  to  the  contrary.  De  Grove  v.  Metropolitan  Ins.  Co.,  61  N.  Y. 
594,  602.  But  although  the  conditions  of  an  oral  contract  upon  which  a  policy 
is  to  be  issued  are  prima  fade  those  of  the  ordinary  policy  applicable  to  the  case, 
parol  evidence  is  admissible  to  show  any  particular  condition  that  was  agreed  on. 
Salisbury  v.  Hekla  F.  Ins.  Co.,  32  Minn.  458. 

3  Eureka  Ins.  Co.  v.  Robinson,  56  Pa.  St.  256  ;  McQueen  v.  Phoenix  Mut. 
Ins.  Co.,  Sup.  Ct.  Canada,  3  Legal  News,  336  ;  De  Grove  v.  Metropolitan  Ins. 
Co.,  61  N".  Y.  594. 

^  Dayton  Ins.  Co.  v.  Kelly,  24  Ohio  St.  345.     See  also  ante,  §  22. 

37 


§  23  C]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,    ETC.  [CH.  II. 

[§  23  A.  Recent  decisions  are  to  the  same  effect  as  those 
of  earlier  date.  There  can  be  no  doubt  in  this  country  of 
the  validity  of  a  parol  contract  of  insurance, ^  and  it  may  be 
enforced  specifically,  or  by  action  for  its  breach.  2  A  valid 
parol  insurance  may  be  made  in  a  mutual  company  formed 
under  the  New  York  laws  of  1857,  ch.  789.  The  company 
may  bind  itself  by  parol  to  issue  a  policy,  and  will  have  to 
pay  a  loss  occurring  before  the  actual  issue.  ^J 

[§  23  B.  When  it  is  doubtful  from  the  evidence  whether 
an  agent  of  an  insurance  company  and  the  plaintiff  had 
entered  into  a  parol  agreement  of  insurance  or  a  parol  agree- 
ment for  the  issue  of  a  written  policy,  evidence  should  be 
admitted  of  the  custom  of  other  insurance  companies  as  to 
matters  of  this  kind.*  The  facts  may  show  that  the  parol 
agreement  was  not  a  contract  of  insurance  but  merely  an 
agreement  on  the  part  of  the  agent  that  he  would  insure  the 
property  and  keep  it  insured  for  the  plaintiff.  In  such  case 
the  matter  lies  entirely  between  the  plaintiff  and  the  agent 
personally.  °] 

[§  23  C.  The  Statute  of  Frauds  does  not  make  a  writing 
necessary  to  insurance.^  It  has  been  held  that  a  parol  con- 
tract to  insure  for  three  years  or  more  is  not  within  the 
Statute  of  Frauds,  for  the  contingency  may  happen  and  the 
contract   end  within  a   year. "'  (a)      And  in  another  case   a 

1  [Commercial  Union  Ass.  Co.  v.  State,  113  Ind.  331  ;  Lingenfelter  v.  Phcenix 
Ins.  Co.,  19  Mo.  App.  252  ;  Phcenix  Ins.  Co.  v.  Spiers,  87  Ky.  286  ;  People's  Ins. 
Co.  V.  Padflon,  8  Brad.  447  ;  Home  Ins.  Co.  v.  Adler,  71  Ala.  516  ;  Trustees,  &c. 
V.  Brooklyn  F.  Ins.  Co.,  19  N.  Y.  305,  307  ;  N.  W.  Iron  Co.  v.  ^tna  Ins.  Co.,  23 
Wis.  160.J 

2  [Gold  y.  Sun  Ins.  Co.,  73  Cal.  216.] 

8  [Van  Loan  v.  Farmers'  Mut.  F.  Ins.  Ass'n,  90  N.  Y.  280.]  - 

*  [.Etna  Ins.  Co.  v.  N.  W.  Iron  Co.,  21  Wis.  464,  471.] 

5  [Sargent  v.  National  F.  Ins.  Co.,  86  N.  Y.  626.] 

6  [Phrenix  Ins.  Co.  v.  Spiers,  87  Ky.  286.] 

■^  [Wiebeler  v.  Milwaukee  Mechanics'  Mut.  Ins.  Co.,  30  Minn.  464.] 

(a)  A  contract  to  insure  need  not  be  Franklin    Ins.    Co.   v.    Colt,    20   Wall. 

in  writing  :  Emery  v.  Boston    Marine  560  ;  Sanford  v.    Orient    Ins.    Co.,  174 

Ins.  Co.,  138  Mass.  398  ;  and  when  it  Mass.  416,  420  ;    Commercial    F.    Ins. 

may  be  completely  performed  within  a  Co.  v.  Morris,    105  Ala.    498  ;   Croft  v. 

year  upon  the  happening  of  a  contin-  Hanover  F.   Ins.  Co.,  40  W.  Va.   508  ; 

gency,  it  is  not  within  the  statute  of  Howard  Ins.   Co.  v.  Owen,  94  Ky.  197. 

frauds.     Browne,  St.  of  Frauds,  §  275  ;  Upon  such   contract  to    insure,    there 

38 


CH.  II.]    FORM  OF  CONTRACT  AND  PARTIES  THERETO.   [§  23  D 

parol  agreement  for  insurance  was  held  not  void  under  the 
Statute  of  Frauds,  even  though  the  applicant  expected  a  five 
years'  policy.  ^  A  verbal  agreement  to  insure  goods,  not 
only  against  fire,  but  against  other  perils  within  the  Stat- 
ute of  Frauds,  is  valid  as  to  the  former  and  void  as  to  the 
latter.  2] 

[§  23  D,  On  Principle  it  would  seem  that  at  common  law 
there  could  be  no  objection  to  an  oral  contract  to  make  an 
insurance  in  future;  or  to  issue  a  policy  at  a  time  named  or 
within  a  reasonable  time,  holding  the  applicant  insured 
meanwhile  (this  is  the  usual  agreement) ;  or  to  insure  now, 
making  the  full  contract  by  parol,  without  any  expectation 
of  a  policy.  So  far  the  law  is  clear  when  the  contracting 
parties  are  natural  persons,  and  there  is  no  statute  in  the 
way.  But  when  a  corporation  makes  the  contract,  or  a  stat- 
ute enters  the  question,  the  problem  is  not  so  simple.  Un- 
less prevented  by  the  charter  a  company  may  make  valid 
oral  insurance  "  policies. "  ^  But  we  may  ask,  may  not  the 
prevention  be  by  implied  exclusion  as  well  as  by  express 
prohibition?  And  will  a  positive  prohibition  make  the  con- 
tract void  as  between  the  parties,  or  only  lay  the  company 
open  to  forfeiture  for  the  violation  of  the  law  under  which  it 
exists?  Corporations  are  creatures  of  limited  powers,  and 
if  the  charter  of  an  insurance  company  gives  it  the  power  to 
issue  policies  of  insurance,  it  is  a  serious  question  whether  a 
parol  contract  of  insurance,  intended  to  be  final  without  any 
looking  forward  to  a  policy,  would  be  good.  It  is  clear  that 
a  provision  in  the  charter  of  a  company  requiring  all  con- 
tracts of  insurance  to  be  in  writing,  does  not  apply  to  the 
preliminary  contracts  to  make  insurance,  and  these,  although 
in  parol,  will  be  specifically  enforced  even  after  loss.*  In 
such  cases  it  is  very  proper  to  hold  the  contract  good.     It  is 

1  [Van  Loan  v.  Farmers'  Mut.  F.  Ins.  Ass'n,  24  Hun,  132.] 

2  [Mobile,  &c.  Ins.  Co.  v.  McMillan,  31  Ala.  711.] 

3  [Henning  v.  United  States  Ins.  Co.,  47  Mo.  425.] 

4  [Phoenix  Ins.  Co.  v.  Ryland,  69  Md.  437.] 

being  no  evidence  what  the  terms  of  ordinarily  issued  by  the  company, 
the  policy  would  be,  the  policy  con-  Sproul  v.  Western  Ass.  Co.,  33  Ore- 
templated  is  presumed  to  be  the  policy     gon,  98. 

39 


§  23  D]  INSURANCE :    FIKE,   LIFE,   ACCIDENT,    ETC.  [CH.  II. 

incidental  to  the  conferred  power  of  issuing  policies;  but 
when  there  is  no  agreement  contemplating  the  issue  of  a 
policy,  the  parol  contract  being  meant  as  a  finality,  there  is 
no  pretence  of  conforming  to  the  power.  If  the  charter  or 
statute  provision  is  actually  known  to  the  person  dealing 
with  the  company,  he  should  not  be  allowed  to  say  that  the 
contract  is  good.  If  he  acts  without  such  knowledge,  it  has 
been  held  that  even  where  a  statute  requires  a  contract  to  be 
in  writing,  equity  will  relieve  if  the  person  complaining  has 
acted  on  a  parol  agreement,  so  that  it  would  be  a  fraud  on 
him  to  permit  the  other  to  take  advantage  of  the  statute.  ^ 
In  another  case  it  was  held  that  a  mere  parol  promise,  which 
does  not  involve  the  execution  of  a  policy,  is  not  within  the 
general  authority  of  an  officer  or  agent,  and  cannot  be  en- 
forced. ^  The  company  of  course  cannot  be  heard  to  say  that 
it  did  not  know  its  own  charter. 

In  all  cases  of  the  kind  we  are  discussing,  the  first  ques- 
tion is  whether  the  organic  law  of  the  company  gives  the 
right  to  make  parol  contracts,  and  if  not,  the  question  is 
whether  the  parol  contract,  although  ultra  vires,  is  not  after 
all  sustainable.  The  general  principles  of  the  matter  are 
these :  (1)  The  legislative  intent  governs  so  far  as  it  can  be 
determined.^  If  it  is  expressed  or  clearly  implied  that  when 
the  law  is  not  conformed  to,  the  consequences  shall  fall  upon 
the  company  alone,  and  the  contract  shall  be  good  in  favor 
of  third  persons,  the  company  cannot  plead  ultra  vires.  If 
the  law  expressly  declares  the  contract  void  it  will  be  so 
held.  Subject  to  this  rule  of  legislative  intent,  or  rather  as 
aids  to  determine  it  where  it  is  otherwise  doubtful,  the  fol- 
lowing principles  are  invoked.  (2)  One  who  has  received 
and  retained  the  benefit  of  a  transaction  will  not  be  per- 

1  [Simontoii,  &c.  v.  Liverpool,  &c.  Tiis.  Co.,  51  Ga.  76,  81.] 

2  [Constant  y.  Insurance  Co.,  3  AVall.  313  (Pa.),  1881  ;  1  Am.  L.  Reg.  N.  s.  116.] 

3  [Wyman  v.  Bank,  29  Fed.  Rep.  734  ;  Gold  Mining  Co.  v.  National  Bank, 
96  U.  S.  640.  Sometimes  holding  a  contract  void  because  not  made  according 
to  charter  would  punish  the  very  persons  the  legislature  meant  to  protect. 
Roberts  v.  Lane,  64  Me.  108;  Farmington  Bank  v.  Fall,  71  Me.  49.  If  a  penalty 
is  provided  in  the  statute,  that  is  often  deemed  sufficient  to  show  that  the  legis- 
lature meant  to  confine  the  effects  of  its  violation  to  the  specified  consequence. 
Farmers'  &  Mechanics'  Bank  v.  Bearing,  91  U.  S.  29 

40 


CH.  II.]         FORM   OF   CONTRACT   AND    PARTIES    THERETO.      [§  23  D 

mittccl  to  plead  ultra  vires  in  his  oivn  behalf ^  (3)  The  plea 
will  not  be  allowed  as  against  one  innocently  giving  value 
in  good  faith  without  knowing  that  the  contract  was  ultra 
vires.^  And  under  this  rule  it  is  a  question  Avhether  the 
general  public  is  to  be  held  to  know  the  provisions  of  the 
corporate  charter.  My  own  opinion  favors  the  negative.^ 
The  presumption  of  knowledge  of  the  law  should  not  be 
stretched  beyond  the  bounds  of  common  sense,  and  the  rea- 
son behind  it.  Business  men  of  prudence  continually  deal 
with  corporations  without  examining  their  charters,  and  the 
certainty  of  business  transactions  would  be  greatly  impaired 
by  subjecting  their  validity  to  the  provisions  of  charters  and 
statutes  made  for  the  government  of  the  company,  and  which 
could  not  be  known  by  the  business  world  in  general  with- 
->ut  the  expenditure  of  an  immense  amount  of  time,  thus 
hampering  commerce.  Suppose  one  buying  a  railroad  ticket 
had  to  examine  the  company's  charter  to  find  out  that  it  was 
not  acting  ultra  vires,  in  order  to  be  sure  he  could  recover  in 
case  of  accident  or  breach  of  contract!  What  a  mess  things 
would  be  in  I*  If  a  man  in  dealing  with  a  company  does  all 
that  men  of  ordinary  prudence  do  under  like  circumstances, 
he  should  be  treated  as  innocent  and  allowed  to  recover  on 
his  policy.  If,  however,  he  actually  knows  his  contract  is 
in  violation  of  law,  or  fails  of  due  prudence,  which,  if  exer- 
cised, would  have  led  him  to  such  knowledge,  then  the  law 
should  not  protect  its  own  violation,  and  he  must  not  be 
allowed  to  sue  on  his  contract,  but  only  be  refunded  his  pre- 
miums at  the  most. 

Where  a  substantial  effort  is  made  to  conform  to  the  law, 
an  informality  ought  not  to  vitiate  the  policy  unless  such  is 

i  [Parisli  V.  Wheeler,  22  N.  Y.  494 ;  Norton  v.  Bank,  61  N.  H.  592  and  cases 
cited;  National  Bank  v.  Whitney,  103  U,  S.  99  ;  Bank  v.  Bank,  9  Heisk.  408; 
Little  V.  O'Brien,  9  Mass.  426  ;  Union  National  Bank  v.  Mathews,  98  U.  S.  621  ; 
Chester  Glass  Co.  v.  Dewev,  16  Mass.  94  ;  Allen  v.  Freedman's  S.  &  T.  Co.,  14 
Fla.  418.] 

■2  [Credit  Co.  v.  Howe  Machine  Co.,  54  Conn.   387-389.] 

s  [Lloyd  V.  West  Branch  Bank,  15  Pa.  St.  172.  Individuals  cannot  be  ex- 
pected to  carry  in  their  pockets  the  charters  of  all  the  corporations  they  deal 
with.] 

*  [Bissell  V.  Michigan  Southern  Eailroad  Co.,  22  N.  Y.  258.] 

41 


§  24  A]  IXSURANCE :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  II. 

clearly  the  intention  of  the  legislature.  A  mere  technical 
non-compliance  with  a  statute  by  the  assured  through  failure 
to  insert  "names  and  style"  of  all  persons  interested,  will 
not  avoid  the  policy.^] 

§  24.  Subsequent  Modification  by  Parol.  —  The  certificate 
of  the  secretary  of  an  insurance  company  given  to  a  policy- 
holder, setting  forth  the  consent  of  the  directors  that  the 
policy  already  issued  shall  cover  property  not  originally  em- 
braced by  the  policy,  is  evidence  of  a  C(mtract  of  insurance 
upon  the  property  mentioned  in  the  certificate  ;2  unless  by 
charter,  or  by  law,  such  consent  is  restricted  to  specific 
persons.  ^ 

And  for  reasons  already  stated  in  considering  the  ques- 
tion of  the  validity  of  parol  contracts  of  insurance,  there 
seems  to  be  no  doubt  that  a  verbal  agreement  to  extend  the 
terms  of  an  existing  policy,  so  that  it  shall  cover  property 
not  originally  within  the  scope  of  the  contract,  or  otherwise 
modify  the  terms,  would  be  valid.  ^ 

[§  24  A.  Subsequent  oral  Change  of  a  Policy,  contimied.  — 
A  new  and  distinct  oral  agreement  on  sufficient  considera- 
tion may  modify  the  policy  in  any  desired  manner.^  Poli- 
cies are  not  required  by  law  to  be  in  writing,  and  outside 
the  Statute  of  Frauds  there  is  no  rule  preventing  the  change 
of  a  written  contract  by  parol. ^  A  contract  of  insurance  is 
not  within  the  Statute  of  Frauds,  and  although  in  writing 
it  may  be  changed  by  parol,  though  the  policy  says  it  shall 
only  be  changed  by  writing.'^  The  authority  of  the  agents 
of  the  company  to  make  such  subsequent  oral  agreements 
may  be  inferred  from  the  course  of  dealing  with  the  insured 
and  the  recognition  of  such  acts  by  the  company.^     Even 

1  [WoW  V.  Horncaste,  1  B.  &  P.  319,  323.] 

2  Goodall  V.  New  England  Fire  Ins.  Co.,  5  Foster  (N.  H.),  169. 

8  Stark  County  Mut.  Ins.  Co.  v.  Hurd,  19  Ohio,  149.     But  see  post,  §§  369,  370. 
*  "Wood  V.  Rutland  &  Addison  Mut.   Fire  Ins.   Co.,  31  Vt.  (2  Shaw)  552; 
Westchester  Fire  Ins.  Co.  v.  Earle,  33  Mich.  143. 

5  [Willcuts  V.  Northwestern  Mut.  L.  Ins.  Co.,  81  Ind.  300;  Cummings  v. 
Arnohl,  3  Met.  (Mass.)  486,  489  ;  Bunce  v.  Beck,  43  Mo.  266,  280.] 

6  [Roger  Williams  Ins.  Co.  v.  Carrington,  43  Mich.  252.] 

7  [Phoenix  Ins.  Co.  v.  Spiers,  87  Ky.  286.] 

8  [Day  )'.  Mechanic'  &  Traders'  Ins.  Co.,  88  Mo.  325.] 

42 


CH.  II.]   FOKM  OF  CONTRACT  AND  PARTIES  THERETO.      [§  25 

though  the  contract  is  under  seal  the  strict  performance  of 
the  instrument  may  be  waived  by  parol.  ^  Evidence  of  a 
subsequent  oral  agreement  altering  the  written  policy,  con- 
sented to  and  acted  upon  by  both  parties,  is  not  admissible 
to  avoid  a  variance  in  a  written  policy  declared  upon.  A 
subsequent  oral  agreement  on  sufficient  consideration  is 
good,  but  it  must  be  distinctly  set  forth  in  the  declaration.  ^J 
§  25.  Parol  Contracts  in  England.  —  Whether  it  WOuld  not 
be  too  much  to  say  that,  in  England,  a  parol  agreement  for 
insurance  would  be  void,  may  at  least  be  doubted.  ^  In  Mor- 
gan V.  Mather,^  it  was  indeed  held  that  a  contract  of  insur- 
ance, not  in  writing,  would  be  void  as  an  evasion  of  the 
stamp-duty.  But  cases  may  be  easily  conceived  where  no 
such  evasion  is  intended ;  as,  for  instance,  a  verbal  agree- 
ment upon  the  terms,  and  a  loss  before  the  terms  agreed 
upon  are  committed  to  writing,  with  a  refusal  on  the  part  of 
the  insurer  to  execute  and  deliver  the  policy.  The  stamp 
laws,  moreover,  do  not  go  to  the  validity  of  the  contract. 
They  do  not  require  any  description  of  contract  to  be  re- 
duced to  writing  for  the  purpose  of  being  stamped;  they 
simpy  provide  that,  when  expressed  in  writing,  this  paper, 
parchment,  or  vellum,  upon  which  the  contract  is  written, 
shall  not  be  received  in  evidence,  or  have  any  legal  force  or 
validity,  unless  a  stamp  of  a  specific  value  and  amount  has 
been  affixed  to  it.^  But  it  may  happen,  in  a  variety  of 
cases,  that  the  transaction  is  such  that  it  may  be  proved  by 
other  evidence  than  the  written  instrument ;  and  the  objec- 
tions arising  from  the  stamp  acts  may  be  avoided  by  a  re- 
sort to  another  species  of  proof.  ^  The  doubt  expressed  in 
Western  Massachusetts  Insurance  Company  v.  Duifey,''  as 
to  whether  the  stamp  act  does  not  require  that  the  contract 

1  [Dearborn  v.  Cross,  7  Cowen,  48,  50.] 

^  [Henning  v.  United  States  Ins.  Co.,  47  Mo.  425.] 

3  Salvin  v.  James,  6  East,  571. 

4  2  Ves.  Jr.  18. 

^  Addison  on  Contracts,  119. 

6  Comyn  on  Cont.  pt.  1,  c.  3,  p.  45  ;  Phillips  on  Evidence,  c.  9  ;  Chitty  on 
Cont.  115. 

^  2  Kan.  347 ;  Fish  v.  Cottenet,  5  Hand.  (N.  Y.)  538. 

43 


§  26]  INSURANCE  :    FIRE,   LIFE,    ACCIDENT,   ETC.  [CH.  11. 

be  in  writing,  seems  not  to  be  well  founded.  It  may  be  here 
stated  that  the  State  courts  do  not  recognize  the  constitu- 
tional right  of  the  general  government  to  determine  the  rules 
of  evidence  by  which  the  former  shall  be  governed,  and  hold, 
pretty  uniformly,  that  the  law  of  Congress  declaring  that 
no  instrument  shall  be  admitted  or  used  as  evidence  in  any 
court  without  being  duly  stamped  applies  only  to  the  courts 
of  the  United  States.  ^  Whether  it  is  within  the  power  of 
Congress  to  declare  unstamped  contracts  wholly  void  is  a 
question  of  some  doubt.  That  it  is  not  has  been  declared 
in  Illinois  2  and  in  Kentucky.^  But  it  is  doubtful  if  this 
will  become  the  settled  view  of  the  law  upon  mature  consid- 
eration.'* It  is  also  very  generally  held  that  under  United 
States  Statutes,  1864,  c.  173,  §  163,  and  1865,  c.  78,  only 
those  unstamped  instruments  can  be  said  to  be  void  where 
the  stamp  has  been  omitted  with  intent  to  defraud  the 
revenue.^  And  such  is  the  law  under  the  statute  of  1866, 
c.  184,  §  9.6 

§  26.  The  laxity  and  informality  of  a  policy  of  insurance 
have  been  frequently  the  subject  of  judicial  animadversion. 

1  Caqienter  v.  Snelling,  97  Mass.  452 ;  Hitchcock  v.  Sawyer,  39  Tt.  412  ; 
Dudley  r.  Wells,  55  ile.  145  :  McGovern  r.  Hoesback,  53  Pa.  St.  176, 177 ;  Griffin 
V.  Eanney,  35  Conn.  239 ;  Ci-aig  v.  Dimock,  47  111.  308  ;  Bunker  r.  Green,  48 
lU.  243  ;  United  States  Express  Co.  i-.  Haines,  id.  248  :  Twitchell  v.  Common- 
wealth, 7  "Wall.  (U.  S. )  321  ;  Green  v.  Holway,  101  Mass.  243.  Contra,  in  Penn- 
sylvania, by  a  divided  court,  Chartiers  &  Rob.  Turnpike  Co.  v.  McNamara,  72 
Pa.  St.  228.  See  the  cases  collected  and  commented  upon,  7  Alb.  L.  J.  49.  In 
Edeck  V.  P»anuer,  2  Johns.  (N.  Y.)  423,  and  Plessinger  r.  Depuy,  25  Ind.  419, 
where  unstamped  instruments  were  excluded,  the  question  of  constitutional 
competency  was  not  raised. 

2  Latham  v.  Smith,  45  111.  29. 

8  Hunter  v.  Cobb,  1  Bush  (Ky.),  239. 

*  License  Tax  Cases,  5  Wall.  (U.  S.)  462  ;  Pervear  v.  Commonwealth,  id. 
475  ;  Green  v.  Holway,  101  Mass.  243. 

5  Tobey  j;.  Chipman,  13  Allen  (Mass.),  123  ;  Willey  v.  Eobinson,  id.  128  ; 
Govern  r.  Littlefield,  id.  127;  Lynch  r.  ilorse,  97  Mass.  458;  Whitehill  v. 
Shickle,  43  Mo.  537;  Hallock  i-.  Jaudin,  34  Cal.  167  :  Harper  v.  Clark,  17  Ohio 
St.  190.  See  also  cases  in  Maine,  Vermont,  and  Pennsylvania,  before  cited 
in  this  section.  Contra,  Hugus  v.  Strickler,  19  Iowa,  413  ;  Miller  v.  Morrow, 
3  Coldw.  (Tenn.)  587;  Maynard  v.  Johnson,  2  Xev.  16;  Waynian  v.  Torrey- 
son,  4  id.  124,  which  hold  that  unstamped  instruments,  without  such  intent, 
are  void. 

8  Green  v.  Holway,  101  ^lass.  243.  This  case  contains  a  valuable  summary 
of  the  stamp  laws,  and  of  the  adjudications  thereon. 

44 


CH.  II.]    FORM  OF  CONTRACT  AXD  PARTIES  THERETO.     [§  27 

"Courts  of  law,"  said  Mr.  Justice  Buller,i  "have  always 
considered  a  policy  of  insurance  as  an  absurd  and  incoherent 
instrument."  "Policies  of  insurance,"  said  Chief  Justice 
Marshall,^  "are  generally  the  most  informal  instruments 
which  are  brought  into  courts  of  justice."  But  length  of 
time  and  a  multitude  of  judicial  decisions,  embracing  almost 
every  important  word  in  the  ancient  though  inaccurate  form, 
have  at  length  so  settled  the  force  and  meaning  of  its  differ- 
ent parts,  that  any  serious  attempt  to  alter  or  reconstruct 
with  reference  to  greater  certainty  or  symmetry  would 
doubtless  lead  to  new  doubts  and  new  litigation,  and  should 
be  admitted  only  after  the  most  careful  consideration. ^  Lord 
Mansfield  said  he  did  not  recollect  an  addition  which  had 
not  created  doubts  upon  its  construction;  and  in  this  coun- 
try it  would  seem  that  attempts  to  reform  have  been  attended 
with  no  better  success.^ 

§  27.  The  Form  unessential.  —  No  particular  form  is  abso- 
lutely necessary.  A  policy  may  be  in  the  form  of  a  bond, 
or  in  any  other  form,  provided  its  scope  and  meaning  import 
an  insurance.^  Policies  are  sometimes  executed  both  in  this 
country  and  in  England,  under  seal,  though  this  practice  is 
chiefly  confined  to  companies  of  long  standing,  which  can 
trace  their  existence  back  to  the  time  when  it  was  held  that 
corporations  could  only  contract  in  that  manner.  But  poli- 
cies are  now  common  in  England  signed  by  three  of  the 
directors  of  the  company,  and  with  us  it  is  the  very  general 
practice  to  provide,  in  acts  of  incorporation,  that  policies 
signed  by  the  president  and  countersigned  by  the  secretary 
shall  be  binding.  And  the  signatures  of  de  facto  directors 
or  officers  will  give  effect  to  the  policy  in  the  hands  of  a 
stranger.  He  need  not  inquire  into  the  regularity  of  their 
appointment.^     In  fact,  any  person  may  engage  in  the  busi- 

1  Broiigh  V.  Whitmore,  4  T.  R.  206. 

2  Yeaton  v.  Fry,  5  Cranch,  335. 

8  Per  Ld.  Mausfield,  Simond  v.  Boydell,  Doug.  268. 
*  Phillips  on  Insurance,  vol.  i.  c.  1,  §  2. 

5  Kent  V.  Bird,  Cowp.  583  ;  Puller  v.  Glover,  12  East,  124  ;  Roebuck  v.  Ham- 
merton,  Cowp.  737. 

8  County  Life  Ass.  Co.,  In  re,  L.  R.  5  Ch.  App.  288. 

45 


§27]  insurance:    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  IT- 

ness  of  insurance,  and  his  contracts  relative  thereto,  whether 
in  writing,  or,  as  we  have  just  seen,  by  parol,  will  be  valid. 
[A  parol  contract,  however,  must  have  all  the  requisites  of 
a  written  contract,  viz.:  subject-matter;  the  risks  insured 
against;  the  amount  insured;  the  duration  of  the  risk,  and 
the  premium  of  insurance.  A  want  of  any  one  of  these  is 
fatal.  ^  It  is  sufficient,  however,  if  the  items  are  fixed  by  a 
previous  course  of  dealing;  for  example,  a  parol  contract  of 
insurance  is  good,  though  nothing  is  said  about  the  pre- 
mium, where  the  parties  have  dealt  together  for  years,  and 
know  the  rate  of  premium,  and  the  agents  have  been  in  the 
habit  of  giving  the  plaintiff  credit  for  the  premium.^]  It  is 
well,  though  perhaps  not  necessary,  when  policies  are  under 
seal,  and  contracts  by  the  parties  thereto  are  made  to  vary 
or  continue  the  original  contract,  that  these  also  should  be 
under  seal,  whether  indorsed  upon  the  back  of  the  policy  or 
not.  3  If  the  indorsement  be  without  seal,  it  may  be  a  new 
contract,  in  which  assumpsit  will  lie>  If  the  policy  under 
seal  provides  for  its  continuance  from  year  to  year,  there  is 
no  new  contract  at  the  expiration  of  the  year,  and  covenant 
must  be  brought.^  If  the  charter  requires  policies  to  be 
under  seal,  and  a  policy  be  issued  and  accepted  by  mutual 
mistake  without  a  seal,  the  court  will  reform  the  contract.^ 
[A  policy  may  be  left  blank  and  filled  up  by  the  insertion 
of  "whom  it  may  concern,"  or  with  the  names  of  the  parties 
for  whom  it  was  issued,  where  such  a  custom  is  shown. '^] 

A  modern  policy  of  fire  insurance,  it  has  been  well  said, 
is  a  very  complicated  contract.  Before  executing  almost 
any  other  instrument  of  equal  perplexity,  the  parties  would 

1  [Tyler  i;.  New  Amsterdam  Fire  Ins.  Co.,  4  Robt.  (N.  Y.)  151,  155.] 

2  [Hoice  V.  Thames,  &c.  Marine  Ins.  Co.,  88  Hun,  246.] 

8  Kaines  v.  Knightly,  Skinner  (Eng.  folio),  54  ;  Luciani  v.  Am.  Fire  Ins.  Co., 
2  Wliart.  (Fa.)  167  ;  Head  v.  Frov.  Ins.  Co.,  2  Cranch,  127  ;  Robinson  v.  Tobin, 

1  Stark.  336. 

*  Sliertzer  v.  Mut.  Fire  Ins.  Co.,  46  Md.  506  ;  Frost  v.  Liverpool,  &c.  Ins.  Co., 

2  Hannay  (N.  R.),  278. 

5  Baltimore  Fire  Ins.  Co.  v.  McGowan,  16  Md.  47. 

6  Wright  V.  Sun  Mut.  Ins.  Co.,  29  U.  C.  (C.  P.)  221,  carried  to  Supreme 
Court  of  Canada  on  appeal. 

7  [Turner  v.  Burrows,  8  Wend.  144,  151.] 

46 


GIL  II.]         FORM   OF   CONTRACT    AND    PARTIES    THERETO.  [§  28 

deem  it  necessary  to  take  the  advice  of  counsel.  Questions 
frequently  arise  as  to  the  proper  construction  of  the  terms 
used,  which  divide  the  opinions  of  the  most  learned  jurists.^ 
And  it  may  be  added  that  the  indifference,  not  to  say  cul- 
pable negligence,  of  too  confiding  applicants,  who  often 
enter  into  contracts  of  this  kind  as  they  would  into  no 
others,  without  being  aware,  except  in  the  most  general 
way,  of  their  terms  and  conditions,  has  produced,  and  is 
producing  the  most  serious  disappointments  in  the  shape  of 
litigation,  always  expensive  and  vexatious,  and  not  unfre- 
quently  fruitless  and  disastrous.  Yet  such  disappointments 
are  but  the  natural  results  of  a  want  of  care  and  foresight ; 
and  by  the  exercise  of  these  they  may  be,  to  a  very  great 
extent,  avoided.  No  one  is  safe  in  accepting  a  policy,  with- 
out the  most  careful  examination  of  its  contents. 

§  28.  Policies  have  sometimes  been  so  loosely  worded  as 
to  leave  it  doubtful  whether  the  obligatory  clause  imported 
a  promise.  In  Alchorne  v.  Saville,^  a  question  arose  whether 
a  clause  in  the  policy  declaring  that  "the  trustees  and  direc- 
tors of  the  company,  whose  names  are  hereunto  subscribed, 
do  order,  direct,  and  appoint  the  directors  for  the  time  being 
of  the  said  company  to  raise  and  pay,"  &c.,  was  sufficient 
upon  which  to  found  an  action  of  covenant ;  and  it  was  held 
that  the  words  imported  merely  an  order  to  pay,  by  which 
neither  the  parties  who  executed  the  policy,  nor  those  to 
whom  it  was  directed,  were  bound.  Where,  however,  it 
was  declared  by  the  policy,  that,  in  case  of  loss,  the  society 
was  to  pay,  and  it  was  further  stipulated  and  declared  that 
the  directors  should  not  be  liable  except  under  the  articles 
establishing  the  society,  one  of  which  was  that  losses  were 
to  be  made  good  within  ninety  days,  the  court  refused  the 
defendant's  motion  to  arrest  judgment  on  the  ground  that 
there  was  no  agreement,  and  held  that  the  action  would  lie.^ 
A  covenant  to  pay  a  certain  amount,  in  case  of  loss  or 
damage,  out  of  the  money  raised  by  the  first  instalments,  or 

1  "Woodbury  Savings  Bank  v.  Charter  Oak  lus.  Co.,  31  Conn.  517. 

2  6  J.  B.  Moore,  202,  n. 

3  Andrews  v.  Ellison,  6  Moore,  199. 

47 


§  29]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  II. 

calls  on  shares  in  the  company,  is  a  simple  covenant  to  pay, 
not  limited  or  qualified  by  the  condition  precedent  that  there 
should  be  funds  in  hand  arising  from  calls  or  shares  suffi- 
cient for  that  purpose.  The  liability  of  the  company  does 
not  at  all  depend  upon  the  question  from  what  source  the 
funds  to  discharge  it  are  to  come,  or  on  the  question  whether 
or  not  there  are  any  funds. ^ 

§  29.  The  Policy.  —  But  although  it  may  now  be  consid- 
ered as  settled  that  a  verbal  agreement  would  be  valid,  and 
that  the  particular  form  of  the  contract  is  of  secondary  im- 
portance, yet  it  is  the  almost  universal  practice  to  embody 
the  terms  of  the  contract  in  a  written  instrument  called  a 
Policy. 2  This  should  contain  the  names  of  the  contracting 
parties;  of  the  insurer,  who  signs  or  underwrites  the  policy, 
and  hence  is  frequently  termed  the  underwriter,  whereby  he 
obligates  himself,  in  consideration  of  a  certain  sum,  called 
the  premium,  to  him  paid  by  the  other  party,  to  take  upon 
himself  the  hazard,  called  the  risk,  and  to  make  good  to  him 
the  particular  loss  he  may  sustain ;  and  of  the  insured,  who 
pays  the  premium  to  secure  this  indemnity  against  loss.  ]t 
should  also  contain  the  precise  time  from  which  the  risk 
commences  and  at  which  it  terminates ;  a  description  of  the 
property,  or  life,  or  other  subject-matter  of  insurance ;  the 
conditio7is  to  which  the  contract  is  subject;  the  limitations 
upon  the  risk ;  and,  in  short,  all  such  facts  and  data  about 
which  disputes  may  arise,  as  are  not  susceptible  of  settle- 
ment by  resort  to  the  general  principles  which  govern  the 
contract.  In  practice  the  description  of  the  subject-matter, 
except  in  a  general  way,  and  the  conditions,  are  not  usually 
incorporated  into  the  body  of  the  policy  proper.  The  former 
is  contained  in  a  separate  paper  termed  the  application  or 
declaration,  deposited  with  the  underwriter  by  the  party 
applying  for  insurance,  while  the  latter  are  indorsed  upon 
the  back  of  the  policy.  They  are  both,  however,  made  com- 
ponent parts  of  the  policy  by  reference, ^  and  constitute  its 

1  Pilbrow  V.  Atmospheric  Railway  Co.,  5  C.  B.  440. 

2  For  form,  see  Appendix. 

8  Worsley  v.  AVood  (in  error),  6  T.  E.  710  ;  Eoutledge  v.  Burrell,   1  H.  Bl. 
48 


CH.  II.]        FOKM    OF   CONTRACT   AND    PARTIES   THERETO.       [§  29  A 

most  essential  features,  requiring  the  especial  consideration 
of  the  party  seeking  protection.  It  is  not  unusual  to  insert 
in  the  policy  a  special  clause  called  the  memorandum,  ex- 
empting the  insurer,  either  wholly  or  partially,  from  liability 
for  loss  or  damage  to  certain  specified  articles,  or  on  account 
of  certain  specified  causes,  or  containing  some  particular 
condition,  limitation,  or  exemption  not  contained  in  the 
usual  form,  and  which  arises  out  of  the  circumstances  of 
the  particular  case. 

[§  29  A.  What  constitutes  Part  of  the  Policy.  —  We  have 
already  noted  in  the  preceding  section  that  an  application  re- 
ferred to  in  the  policy  as  a  part  of  it,  becomes  part  of  it  in  legal 
contemplation,  and  there  is  an  unbroken  current  of  authority 
to  that  effect.  1  But  the  rule  that  an  application,  survey,  de- 
scription, tfec,  referred  to  in  the  policy,  shall  be  a  part  of  it, 
does  not  apply  where  the  application,  &c.,  is  not  in  writing. ^ 

How  far  marginal  notations  and  indorsements  are  to  be 
considered  as  part  of  the  contract,  depends  upon  what  seems 
to  be  justice,  and  the  intent  of  the  parties  on  all  the  facts  of 
the  case  that  are  properly  in  evidence.  Words  and  figures 
in  the  margin  of  a  policy  and  connected  with  it  in  sense  are 
a  part  of  it.^  In  general,  memoranda  on  the  margin  of  a 
policy  are  a  part  of  the  contract  of  insurance,  and  are  as 
binding  as  though  in  the  body  of  the  policy.^  But  it  has 
been  held  that  the  clause,  "Non-forfeiture  endowment  policy 
with  profits,"  in  the  margin  of  a  policy,  cannot  be  read  as  a 
part  of  it.^  An  indorsement  proved  to  have  been  made  upon 
an  instrument  before  it  is  executed  may  be  parcel  of  the 
obligation.^     But  in  the  absence  of  such  proof,  an  indorse- 

254  ;  Oldman  v.  Bewicke,  2  id.  577,  note  ;  Holmes  v.  Charlestown  Mut.  Fire 
Ins.  Co.,  10  Met.  (Mass.)  211. 
-  1  [Egan  V.  Mutual  Ins.  Co.,  5  Denio  (N.  Y.),  326,  327  ;  Md.  Ins.  Co.  v.  Bos- 
siere,  9  G.  &  J.  121,  155  ;  Bohbitt  v.  Liv.  &  Lon.,  &c.  Ins.  Co.,  66  N.  C.  70; 
Byers  v.  Farmers'  Ins.  Co.,  35  Ohio  St.  606  ;  Carson  v.  Jersey  City  Ins.  Co.,  43 
N.  J.  300.] 

2  [O'Brien  v.  Ohio  Ins.  Co.,  52  Mich.  131.] 

3  [Pierce  v.  Charter  Oak  Ins.  Co.,  138  Mass.  151.] 

*  [McLaughlin  v.  Atlantic  Ins.  Co.,  57  Me.  170,  173.] 

5  [McQuitty  V.  Continental  L.  Ins.  Co.,  15  R.  I.  573.] 

6  [Emerson  v.  Murray,  4  N.  H.  171.] 

VOL.  I,  —  4  49 


§  29  C]       insurance:  fire,  life,  accident,  etc.  [CH.  II. 

ment  on  the  policy  not  referred  to  in  the  policy  or  in  the 
by-laws,  will  be  deemed  the  act  of  the  insurer  and  not  bind- 
ing on  the  assured.!  a  diagram  of  the  buildings  insured 
on  the  back  of  an  application  does  not  bind  the  assured  in 
the  absence  of  proof  that  he  had  something  to  do  with  it, 
although  by  printed  directions  the  agents  were  required  to 
draw  the  same.^] 

[§  29  B.  Negotiations  and  agreements  prior  ^  to  or  con- 
temporaneous with  the  policy  are  merged  in  it,  and  unless 
in  writing  and  referred  to  in  the  policy,  or  by  law  made  a 
part  of  it,  are  of  no  avail  after  the  issue  of  a  valid  policy 
except  to  show  misrepresentation,  or  to  establish  a  case  for 
the  reformation  of  the  policy,  or  to  show  that  the  delivery 
was  not  absolute. 

No  oral  agreement  at  the  time  of  insurance  that  is  not 
incorporated  in  the  policy  can  overcome  a  prohibition  of  the 
policy.^  Statements  of  an  insurance  agent  prior  to  the  exe- 
cution of  the  policy  are  not  admissible  against  the  company 
to  vary  the  terms  of  the  written  contract.^  A  memorandum 
or  slip  offered  to  show  the  intention  of  the  parties  as  opposed 
to  a  written  policy  of  insurance  between  them,  is  inadmis- 
sible. In  law,  it  is  only  evidence  to  prove  a  misrepresen- 
tation; in  equity,  to  correct  the  policy.^  When  a  policy 
contained  no  reference  to  a  published  prospectus  from  which 
it  materially  differed,  in  an  action  on  the  former,  the  latter 
was  held  inadmissible,  to  extend  and  enlarge  the  terms  of 
the  policy.'^] 

[§  29  C.  Statutes  requiring  Annexation  of  the  Application 
to  the  Policy.  — By  the  Iowa  statute  a  copy  of  -the  application 
must  be  indorsed  on  or  attached  to  the  policy,  in  order  to 
enable  the  company  to  rely  on  false  statements  in  the  appli- 

1  [Planters'  Miit.  Ins.  Co.  v.  Rowland,  66  Md.  236.] 

2  [Vilas  V.  N.  Y.  Central  Ins.  Co.,  72  N.  Y.  590,  593.] 

3  [Greenwood  v.  N.  Y.  L.  Ins.  Co.,  27  Mo.  App,  401,  411;  Insurance  Co.  v. 
Mowry,  96  U.  S.  544.] 

*  [-^perry  v.  Springfield  F.  &  M.  Ins.  Co.,  26  Fed.  Rep.  234  (Col.),  1886.] 
6  [Sullivan  v.  Cotton  States  L.  Ins.  Co.,  43  Ga.  423,  427.] 
6  [Daw  V.  Whetten,  8  Wend.  (N.  Y.)  160,  166.] 
T  [Mut.  Ben.  L.  Sus.  Co.  v.  Ruse,  8  Ga.  534,  539.] 
50 


CH.  II.]         FORM   OF   CONTRACT   AND   PARTIES    THERETO,  [§  30 

cation  as  matter  of  defence. ^  So  in  Iowa,  if  a  company  fails 
to  attach  a  copy  of  the  application,  signature  and  all,  to  the 
policy  of  which  it  is  declared  to  be  a  part,  every  statement 
in  the  application  is  conclusively  presumed  to  be  true  as 
against  the  company.  ^  And  in  Pennsylvania,  unless  a  copy 
of  the  application  is  attached  to  the  policy,  it  constitutes  no 
part  thereof,  and  is  not  receivable  in  evidence.^  But  a  stat- 
ute that  merely  prohibits  the  use  of  an  application  for  the 
purpose  of  qualifying  the  policy  unless  attached  to  it,  does 
not  interfere  with  the  use  of  the  application  to  show  fraud 
in  obtaining  the  policy.*] 

§  30.  Kinds  of  Policies.  — Policies  are  divided  into  valued 
and  open,  wager  and  interest,^  time  and  voyage.^  A  vahied 
policy  is  one  in  which  the  sum  to  be  paid  as  an  indemnity 
in  case  of  loss  is  fixed  by  the  terras  of  the  contract;^  an  open 
policy  is  one  in  which  the  sum  so  to  be  paid  is  not  fixed, 
but  is  left  open  to  be  proved  by  the  claimant  in  case  of  loss, 
or  to  be  determined  by  the  parties,^  and  the  determination 
is  called  the  adjustment  of  the  loss.  The  difference  between 
a  valued  and  open  policy,  in  point  of  form,  is  this,  that  the 
blank  which  is  intended  to  be  filled  up  by  the  sum  at  which 
the  parties  agree  to  fix  the  value  of  the  property  insured, 
and  the  amount  of  damages  to  be  recovered  in  case  of  loss, 
as  between  themselves,  is  filled  up  in  the  former,  while  it  is 
not  filled  in  the  latter,  or,  at  least,  is  not  stated  as  an  agreed 
valuation,  or  sum  to  be  recovered  in  case  of  loss.  The  dif- 
ference between  them  in  point  of  ejfect  is,  that  under  an  open 
policy,  in  case  of  loss,  the  insured  must  prove  the  true  value 
of  the  property  insured,  while  under  a  valued  policy  he  need 

1  [Cook  V.  Federal  L.  Ass.,  74  Iowa,  746.] 

2  [Dunbar  v.  Phenix  Ins.  Co.,  72  Wis.  492  ;  R.  S.  §  1945  a.] 

3  [Act  of  May  11,  1881,  P.  L.  20  ;  Imperial  F.  Ins.  Co.  v.  Dunham,  117  Pa. 
St.  460,  473  ;  New  Era  L.  Ins.  Co.  v.  Musser,  120  Pa.  St.  384.] 

•*  [Carrigan  v.  Mass.  Ben.  Ass.,  26  Fed.  Rep.  230  (Pa.),  1884.] 

5  [See  §  33.] 

6  [See  §  34.] 

'  [A  policy  is  valued  only  when  a  valuation  is  fixed  by  way  of  liquidated  dam- 
ages to  avoid  making  a  valuation  after  loss.  Universal  Ins.  Co.  i\  Weiss,  106 
Pa.  St.  20,  27.] 

8  [Fire  Ins.  Ass.  v.  Miller,  2  Tex.  Civ.  Cas.  §  332.] 

51 


§  30]  INSURANCE  :    FIRE,   LIFE,    ACCIDENT,   ETC.  [CH.  II. 

never  do  so,  the  sura  agreed  upon  being  taken  as  conclusive 
both  at  law  and  in  equity,  unless  in  cases  oi  fraud,  or  of 
such  excessive  overvaluation  as  to  raise  a  presumption  of 
fraud. K«0    ^'^^   *1^^   overvaluation,   in  the  expressive  lan- 

1  Haigh  V.  De  la  Cour,  3  Camp.  319  ;  1  Arnould  on  Insurance,  304  ;  Alsop  v. 
Com.  In".  Co.,  1  Sumner,  451  ;  Feise  v.  Aguilar,  3  Taunt.  506  ;  Carson  v.  Marine 
Ins.  Co.,  2  Wash.  C.  C.  468  ;  Lewis  v.  Rucker,  2  Burr.  1167  ;  Shawe  v.  Felton,  2 
East,  109  ;  Forbes  v.  Aspinall,  13  id.  323,  326  ;  Holmes  v.  Charlestown  Mut.  Fire 
Ins.  Co.,  10  Met.  (Mass.)  211  ;  Young  v.  Turing,  2  Scott,  N.  R.  752  ;  Coolidge 
V.  Gloucester  Mar.  Ins.  Co.,  15  Mass.  341  ;  Lycoming  County  Mut.  Ins.  Co.  v. 
Mitchell,  48  Pa.  St.  (12  Wright)  367,  372  ;  Laurent  ■».  Chatham  Fire  Ins.  Co.,  1 
Hall  (N.  Y.  Superior  Ct.),  41  ;  Cushman  v.  North  Western  Ins.  Co.,  34  Me.  487; 
Borden  v.  Hingham  Mut.  Fire  Ins.  Co.,  18  Pick.  523  ;  Phoenix  Ins.  Co.  v.  Mc- 
Loon,  100  Mass.  475  ;  Miller  v.  Germania  Fire  Ins.  Co.,  C.  P.  (Pa.)  6  Ins.  L.  J. 
873.  By  the  French  law,  the  valuation  is  not  conclusive  if  it  exceeds  "reason- 
able limits."  Decree  of  the  Court  of  Aix,  March  24,  1830,  cited  in  Rogron,  Code 
de  Commerce  Explique,  art.  336,  n.  ;  Pardessus,  Cours  de  Droit  Com.  593,  6  and 
7  ;  Alauzet,  Traite  General  des  Assurances,  221  et  seq.  ;  3  Kent's  Com.  273, 
n.  (d),  and  cases  there  cited.  Boulay-Paty  is,  however,  incorrectly  cited.  He 
agrees  with  the  other  authors.  Cours  de  Droit  Com.  Mar.  tit.  10,  §  20.  And 
what  are  "reasonable  limits  "  is  to  be  determined  by  the  circumstances  of  each 
particular  case.  Probably  they  would  not  differ  much  from  the  "grossly  enor- 
mous" overvaluation  of  Mr.  Justice  Yeates,  or  that  excessive  overvaluation 
which  raises  a  presumption  of  fraud,  of  the  other  authorities. 

(a)   The  question  of  fraud  in  valua-  452.     See  Hand  v.  National  Live-Stock 

tion  is  one  of  fact  for  the  jury  ;  such  Ins.   Co.,    57    Minn.     519  ;    Purves   v. 

fraud  need  not  be  proved  beyond  a  rea-  Germania  Ins.  Co.,  44  La.  An.  123. 
sonable  doubt,  and  must  have  been  in-         The  valued  policy  statutes  of  Missouri 

tended.    F.  Dohmen  Co.  v.  Niagara  F.  and  other   States,   prohibiting  the  in- 

Ins.  Co.,  96  Wis.   38  ;  Commercial  Ins.  surer   from  denying   that   the   amount 

Co.  V.  Friedlander,  156  111.  595  ;  West-  insured,   less    any   depreciation,   repre- 

ern  Ass.  Co.  v.  Ray  (Ky.),  49  S.W.  326  ;  sents  the  value  of  the  insured  property, 

Phoenix   Ins.    Co.  v.  McKernan  (Ky.),  in  effect  change  open  policies  to  valued 

46  id.  10  ;  Kenton  Ins.  Co.   v.   Wiggin-  policies;    though   making   no   contract 

ton,  89  Ky.  330  ;   Teutonia  F.  Ins.  Co.  for  the  parties,  they  estop  them,  after 

V.  Howell  (Ky.),  54  S.  W.  852  ;  German  they  have  voluntarily  fixed   the   valua- 

Ins.  Co.  V.  Read  (Ky.),  13  S.  W.  1080  ;  tion,  from  denying  that  valuation  when 

Hanover   F.    Ins.   Co.  ?'.  Stoddard,  52  there  is  no  fraud  ;    they  do  not  create 

Neb.  745  ;  Virginia  F.  &  M.  Ins.  Co.  v.  wagers,  and  are  constitutional.     Orient 

Saunder.s,  86  Va.  969.     Under  an  open  Ins.  Co.  v.  Daggs,  172  U.  S.  557.     See 

policy,  the  jury,  being  bound  to  ascer-  also   as   to   such    statutes.    Havens    v. 

tain    whether    the    loss   was  total    or  Germania   F.    Ins.    Co.,  123  Mo.  403 ; 

partial,  and   the   market  value  of  the  O'Keefe  v.  Liverpool,  &c.  Ins.  Co.,  140 

property,  cannot  find  for  the  plaintiff  if  Mo.   558  ;    Ins.  Co.    v.  Leslie,  47  Ohio 

the  evidence  as  to  such  value  is  too  in-  St.  409,  416  ;  British  America  Ass.  Co. 

definite  for  them  to  determine  it.   Man-  v.   Bradford,   60  Kansas,   82  ;  Ins.  Co. 

Chester  F.  Ass.  Co.  v.  Feibelman,  118  of  North  America  v.  Bachler,  44  Neb. 

Ala.  308,  329 ;  Cascade   F.  &  M.  Ins.  549 ;    Gibson    v.   Conn.    F.    Ins.    Co., 

Co.  V.  Journal  Pub.  Co.,  1  Wash.  St.  77    Fed.   Rep.    561  ;    Seyk   v.   Millers' 
52 


CH.  II.]    FOEM  OF  CONTRACT  AND  PARTIES  THERETO.     [§  31 

guage  of  Mr.  Justice  Yeates,  ^  must  be  "  grossly  enormous  " 
to  admit  of  any  dispute.  The  statement  as  to  value  of  prop- 
erty insured  is  not  a  warranty  but  matter  of  opinion,  which, 
if  honestly  entertained,  does  not  vitiate  the  policy.  ^  The 
agreed  value  does  not,  however,  admit  an  insurable  interest, 
and  this  must  be  proved  to  some  extent.^  And  the  insured 
is  concluded  by  the  valuation  as  well  as  the  insurer.* 

§  31.  Valued  and  Open  Policies.  —  Whether  the  policy  is 
an  open  or  valued  one  is  not  unfrequently  a  question  of 
some  difficulty.  The  words  "valued  at,"  as  qualifying  the 
property  insured,  are  frequently  used;  but  any  form  of 
words  showing  the  intention  of  the  parties  to  fix  the  value 
of  the  property  is  sufficient.  If  the  property  insured  con- 
sists of  a  single  article,  or  of  separate  and  distinctly  differ- 
ent articles,  either  in  character  or  value,  and  the  insurance 
is  in  a  gross  sum  upon  all,  as,  for  instance,  110,000  on  one 
brick  house,  or  upon  one  brick  and  two  wooden  houses, 
nothing  being  said  of  the  value,  this  is  not  a  valued  policy. 
The  sum  here  neither  fixes  the  total  value  of  all,  nor  the 
proportionate  value  of  either,  and  in  case  of  loss  of  either  or 
all,  the  question  is  open  for  proof  as  to  the  amount  of  the 
loss.-''  But  where  there  is  a  total  loss  of  an  article  distinctly 
valued  in  the  policy,  the  loss  is  to  be  estimated  according 
to  the  valuation.  And  if  the  insurance  be  upon  numerous 
articles  of  equal  value,  under  a  valuation  of  the  whole,  the 
insured  will  recover  of  the  whole  valuation  the  proportion 
which  the  number  lost  bears  to  the  whole  number  insured; 
as,  where  ten  hogsheads  of  tobacco,   specified  to  be   worth 

1  Miner  v.  Tagert,  3  Biun.  (Pa.)  204,  205.     And  see  post,  §  373, 

2  Bedford  V.  Mut.  Fire  Ins.  Co.,  38  U.  C.  (Q.  B.)  538. 

3  Feise  v.  Aguilar,  3  Taunt.  508  ;  s.  c.  Hildyard  on  Marine  Insurance,  264  ; 
Kane  v.  Com.  Ins.  Co.,  8  Johns.  (N.  Y.)  176  ;  Pleasants  v.  Maryland  Ins.  Co.,  8 
Cranch,  55  ;  Clark  v.  Ocean  Ins.  Co.,  16  Pick.  (Mass.)  289,  295. 

*  Holmes  v.  Charlestown  Mut.  Fire  Ins.  Co.,  10  Met.  (Mass.)  211. 

^  Laurent  i'.  Chatham  Fire  Ins.  Co.,  1  Hall  (N.  Y.  Superior  Ct.),  41  ;  Wallace 
V.  Insurance  Co.,  4  La.  289  ;  Luce  v.  Springfield  Fire  &  Mar.  Ins.  Co.,  Cir.  Ct. 
(West.  Dist.  Mich.),  2  Ins.  L.  J.  443  ;  post,  §  425. 

National  Ins.  Co.,  74  Wis.  67  ;  Sullivan  the  value  of  personal  property.     Joy  v. 

r.  Hartford  F.  Ins.  Co.,  89  Texas,  665.  Security   F.    Ins.     Co.,    83    Iowa,    12; 

In    Iowa,   the   amount    stated    in    the  Martin  v.  Capital  Ins.  Co.,  85  id.  643. 
policy  is  not  prima  facie  evidence  of 

53 


§31]  insurance:   fire,  life,  accident,  etc.         [CH.  II. 

$1,000,  are  insured,  the  loss  of  one  will  give  the  right  to 
recover  $100,  or  the  same  proportion  of  the  amount  insured.  ^ 
(s)  A  valuation  in  the  application  referred  to  in  the  policy 
has  the  same  effect  as  if  stated  distinctly  in  the  policy. 
Tlius,  a  policy  having  this  clause:  "The  amount  insured 
being  not  more  than  three-fourths  the  value  of  said  property, 
as  appears  by  the  proposal  of  the  said  insured,"  is  a  valued 
policy.2  So  where,  while  there  was  a  printed  stipulation 
in  the  policy  that  the  loss  or  damage  was  to  be  estimated 
according  to  the  true  and  actual  cash  value  of  the  property 
at  the  time  of  loss,  it  was  written  in  that  the  plaintiff  was 
insured  "to  the  amount  of  |2,000;  viz.,  on  the  building  and 
fixed  machinery,  $1,700;  on  movable  machinery  therein, 
$150 ;  on  stock,  raw  and  wrought,  $150,  —  said  insured  be- 
ing the  lessee  of  said  mill  for  one  year,  from  Nov.  1,  1850, 
and  having  paid  the  rent  therefor  of  $2,171.01,  which  inter- 
est, diminishing  day  by  day,  in  proportion  for  the  whole  rent 
for  a  year,  is  hereby  insured,"  the  court  held  that  the  policy 
was  a  valued  one  as  to  the  first  two  items.  If  an  open  pol- 
icy, neither  the  plaintiff  nor  defendant  could  be  benefited  in 
any  degree  by  the  insertion  therein  particularly  of  the  rent 
paid  by  the  insured  to  the  lessor;  it  was  wholly  immaterial 
and  unnecessary ;  nor,  if  it  was  an  open  policy,  was  there 
any  occasion  to  recite  that  the  interest  was  one  diminishing 
day  by  day.  This  was  one  element  in  the  value  of  the  loss, 
and  one  so  obvious,  especially  if  the  policy  was  near  its  ex- 
piration, or  had  run  any  considerable  time,  that  it  could  not 
be  expected  to  be  overlooked.  And  although  it  was  agreed 
that  the  loss  or  damage  should  be  estimated  according  to  the 
actual  cash  value  at  the  time  of  the  loss  or  damage,  still  the 
parties  could  fix  upon  a  rule,  and  did,  in  this  case,  fix  upon 
a  rule  by  which  the  cash  value  was  to  be  determined,  not 
the  less  a  rule,  because  it  permitted  of  variation  day  by 
day. 3    (t)  But  where  the  application  stated  the  property  to 

1  Harris  v.  Eagle  Ins.  Co.,  5  Johns.  (N.  Y.)  368. 

2  Nichols  V.  Fayette  Mut.  Fire  Ins.  Co.,  1  Allen  (Mass.),  63  ;  Fuller  v.  Boston 
Fire  Ins.  Co.,  4  Met.  (Mass.),  206  ;  Phoenix  Ins.  Co.  v.  McLoon,  100  Mass.  475. 

8  Cushman  v.  North  Western  Ins.  Co.,  34  Me.  487.     The  policy  in  this  case 

54 


CH.   II.]        FORM   OF   CONTRACT   AND   PARTIES   THERETO.  [§  32 

be  worth  $1,200,  and  it  was  insured  for  -$800,  "being  not 
more  than  three-fourths  of  the  value  of  the  property  de- 
scribed in  the  application,"  and  the  policy  also  contained 
the  provision  that  "this  company  shall  in  no  event  be  liable 
beyond  the  sum. insured,  nor  beyond  three-fourths  of  the 
actual  cash  value  of  the  property  insured  at  the  time  of  loss 
or  damage,  nor  beyond  such  sum  as  will  enable  the  insured 
to  replace  or  restore  the  property  lost  or  damaged,"  this 
latter  clause  was  held  to  control  the  former,  and  to  open 
the  question  as  to  value,  which  otherwise  would  have  been 
fixed.'  But  a  clause,  providing  that  the  "company  shall 
not  be  held  to  pay  any  greater  portion  of  the  loss  or  damage 
sustained  than  the  amount  hereby  insured  shall  bear  to  the 
whole  amount  insured  on  said  property,"  is  operative  only 
when  there  is  other  insurance;  and,  in  the  absence  of  other 
insurance,  does  not  convert  a  valued  policy,  like  the  one  in 
the  case  last  cited,  into  an  open  one;^  nor,  where  there  is  a 
subsequent  valued  policy  indorsed  upon  the  first,  is  the  first 
thereby  converted  into  a  valued  oue.^  [A  policy  for  $2,000 
on  freight  is  an  open  one.*] 

[§  31  A.  Statute  Valuation.  —  In  Texas,  "  a  fire  insurance 
policy  in  case  of  total  loss  becomes  a  liquidated  demand 
against  the  company  for  the  full  amount  of  the  policy, 
provided  that  this  article  shall  not  apply  to  personal 
property. "  ^] 

§  32.  The  same  policy  may  be  open  as  to  one  article  in- 
sured and  valued  as  to  another.     This  was  the  case  in  Post 


was  dated  Nov.  8,  1850  ;  and  the  fire  took  place  Nov.  23,  18.50.  The  jury  re- 
turned a  verdict  assessing  the  damages,  including  interest,  at  ,$1,872.12,  with  a 
special  finding  that  the  loss  on  movable  machinery  was  §151.79,  and  included  in 
the  verdict. 

1  Brown  v.  Qaincy  Mut.  Fire  Ins.  Co.,  105  Mass.  396.  [The  same  point  was 
decided  in  Ohio,  where  it  was  held  that  a  policy  for  $800  on  a  house  worth 
$2, 400,  with  an  agreement  to  pay  all  loss  up  to  the  sum  named,  is  an  open  not 
a  valued  policy.     Farmers'  Ins.  Co.  v.  Butler,  38  Ohio  St.  128.] 

2  Luce  V.  Dorchester  Ins.  Co.,  105  Mass.  297,  298. 

3  Millaudon  v.  Western  Mar.  &  Fire  Ins.  Co.,  9  La.  27. 
*  [Riley  v.  Hartford  Ins.  Co.,  2  Conn.  368,  370.] 

5  [Sun  Mut.  Ins.-  Co.  v.  Holland,  2  Tex.  Civ.  Gas.  448,  substance  of  R.  S.  art. 
2971.] 

55 


§  34]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  II. 

V.  Hampshire  Mutual  Insurance  Company, ^  where  there  was 
an  insurance  of  1500  on  a  house  valued  at  -1750,  and  also  of 
$500  on  furniture,  to  which  no  value  was  fixed.  But  as  the 
by-laws  reserved  to  the  company  in  this  case  the  right  to 
have  a  valuation  made  anew,  without  regard  to  the  valuation 
fixed  in  the  policy,  they  were  not  concluded  by  that  fixed 
valuation.  It  was  also  the  case  in  Cushman  v.  Northwestern 
Insurance  Company. ^ 

§  33.  Wager  and  Interest  Policies,  —  A  wager  policy  is  one 
in  which  it  appears  by  its  terms  that  the  insured  has  no 
interest,  or,  in  other  words,  runs  no  risk.  It  is  a  mere  bet, 
and  is  known  by  the  insertion  of  certain  clauses,  —  such  as, 
^^  without  further  proof  of  interest  than  the  policy,''^  ^^  interest 
or  no  intered^^^  and  their  equivalents,  — having  for  their  ob- 
ject to  relieve  the  insured  from  the  necessity  of  proving  his 
interest  in  case  of  loss.  In  England,  such  policies  are  pro- 
hibited, and  such  clauses  are  proof  conclusive  that  the  con- 
tract is  a  wager.  In  this  country,  however,  they  are  only 
prima  facie  evidence,  and  may  be  explained.^  An  interest 
policy  is  one  in  which  it  appears  by  its  terms  that  the  in- 
sured is  interested  in  the  thing  insured,  or,  in  other  words, 
runs  a  risk.  He  has  something  at  stake,  and,  in  case  of 
loss,  something  to  be  indemnified  for.  Policies  are  usually 
in  this  form,  and  import,  unless  otherwise  expressed,  that 
the  assured  is  interested  in  the  subject-matter.* 

§  34.  Time  and  Voyage  Policies.  —  A  time  policy  is  one  in 
which  the  duration  of  the  risk  is  fixed  by  definite  periods  of 
time,  as  from  January  1st,  M.,  1852,  to  January  1st,  M., 
1853,  or  for  one  year  from  a  specified  date.  A  voyage  policy 
is  one  in  which  the  duration  of  the  risk  is  determined  by 
geographical  limits,  as  from  New  York  to  Liverpool,  and  is 
applicable  to  cases  of  transportation  by  land  as  well  as  by 
water.  ^ 

1  12  Met.  (Mass.)  555. 

2  Uhi  supra. 

8  Alsop  V.  Com.  Ins.  Co.,  1  Sumner,  451,  467.     See  §  74. 
*  Williams  V.  Smith,  2  Gaines  (N.  Y.),  1,  13  ;  Cousins  v.  Nantes,  3  Taunt. 
513. 

'"  Boehm  v.  Combe,  2  M.  &  S.  172 
56 


CH,  II.]        FORM   OF   CONTRACT   AND   PARTIES    THERETO.       [§  35  A 

§  35.  Who  may  be  Parties.  —  Parties  competent  to  con- 
tract generally  may  be  parties  to  a  contract  of  insurance. 
The  insurers  may  be  private  individuals,  or  companies  of 
associated  individuals,  and  so  may  the  insured.  In  this 
country,  the  business,  though  previously  to  the  commence- 
ment of  the  present  century  mostly  in  private  hands,  is  now 
almost  exclusively  in  the  hands  of  incorporated  companies; 
and  there  is  a  large  and  increasing  class  of  these  based  upon 
the  mutual  principle,  in  which  the  members  are  at  once  the 
insurers  and  the  insured,  and  whose  business  is  limited  to 
such  risks  as  are  authorized  by  their  charters,  while  indi- 
viduals may  assume  any  lawful  risk.^  In  England,  private 
underwriting  in  mercantile  insurance  is  largely  carried  on 
by  a  society  of  capitalists,  who  meet  daily  for  the  transac- 
tion of  business  at  Lloyd's  Subscription  Rooms,  and  are 
hence  called  members  of  "Lloyd's."  Each  member  under- 
writes his  name  to  the  policy  offered,  if  he  chooses  to  take 
any  portion  of  the  risk,  and  against  it  the  amount  for  which 
he  will  be  liable  in  case  of  loss,  with  the  date  of  his  sub- 
scrii)tion.  Formerly,  private  underwriting  was  extensively 
carried  on  on  the  continent  of  Europe;  but  there,  as  well  as 
in  England,  the  superior  advantages  of  public  companies  are 
gradually  leading  to  an  abandonment  of  the  ancient  practice. 

[§  35  A.  Infants,  Unlicensed  Merehanf,,  Parties  joining.  — 
A  contract  of  insurance  is  not  a  contract  for  necessaries 
which  will  absolutely  bind  an  infant. ^  It  is  voidable  by  the 
infant,  but  not  by  the  company. ^ 

In  Mississippi  if  a  merchant  makes  a  contract  of  insurance 
on  his  business  while  he  is  unlicensed,  he  cannot  recover  on 
the  policy.* 

Several  parties  interested  in  the  same  property  may  take 
out  joint  insurance  upon  it,  and  a  joint  policy  may  be  taken 
on  property  owned  in  severalty.^] 

1  Andrews  v.  Uniou  Mut.  Fire  Ins.  Co.,  37  Me.  256. 

2  [N.  H.  M.  F.  Ins.  Co.  v.  Noyes,  32  N.  H.  345,  352.] 
8  [Monaghan  v.  Agri.  F.  Ins.  Co.,  53  Mich.  238,  243.] 
*  [Pollard  V.  Phoenix  Ins.  Co.,  63  Miss.  244.] 

6  [Castner  v.  Farmers'  Mut.  F.  Ins.  Co.,  46  Mich.  15.] 

57 


INSUKANCE :   FIRE,  LIFE,  ACCIDENT,   ETC.  [CH.  IIL 


CHAPTER  III. 

THE   EFFECT   OF   WAR. 
Analysis. 

1.  The  thought  at  the  basis  of  the  subject  (§  42  A). 

Private  interests  must  yield  to  public,  but  are  to  be  interfered  witli 
only  so  far  as  the  public  purposes  positively  require  (§  42  A). 

No  subject  can  do  anything  detrimental  to  the  interests  of  his 
country  (§  36),  — whmtary  sa^bmission  to  the  enemy,  receiving 
his  protection,  or  any  act  or  contract  which  tends  to  iiicrease 
his  resources,  as  transmission  of  money  or  goods  or  any  kind  of 
trading  or  commercial  dealing  between  the  two  countries,  is 
unlawful  (§42). 

2.  During  the  war 

a  contract  of  insurance  cannot  be  made  across  the  line  of  hostilities 
(§36). 
such  a  contract  is  void  (§  37). 
an  enemy's  property  in  general  cannot  be  insured,  and  the  disability 
extends  to  subjects  dealing  in  enemy's  property  (§  37). 
and  insurance  of  the  life  or  health  of  one  in  the  enemy's  service 
is  void  (§  37  s.). 
the  life  and  projjcrty  of  an  alien  enemy  domiciled  here  may  be  in- 
sured (§  42  s. ). 

3.  A  contract  made  before  the  war 

is  only  suspended  until  the  conflict  is  over  (§  37),  and  then  revives 
(§§  39,  41,  43). 
except  that  no  recovery  can  be  had  for  loss  of  property  by  cap- 
ture or  otherwise,  in  consequence  of  the  fight  (§  36),  unless  the 
property  was  exempt  from  hostilities  (§  39  s.). 
nor  for  any  loss  of  life  or  health  in  the  enemy's  service  (§  7  s. ). 
is  good   as  to   property  and  lives   exempt  from  belligerent  power 
(§§39s.,  42  s.). 
e.  g.  the   life   of  a   neutral   domiciled   in   the   enemy's   country 
(§  39  s.). 
may  be  kept  alive  by  paying  premiums  to  resident  agent  (§  40). 

4.  Domicil  of  the  owner  in  the  enemy's  country  is  the  general  test  as  to 

property  (§§  38,  42  s.). 

and  the  line  of  demarcation  is  that  claimed  and  held  by  the  belli- 
gerent power  (§  38). 

if  the  United  States  were  at  war  with  Spain,  a  Spaniard  domiciled 
here  could  contract  and  sue  here  like  a  citizen  (§  42  s.). 

in  respect  to  life,  hostile  nationality  must  be  combined  with  domicile 
in  the  enemy's  country  to  avoid  the  insurance  (§  39  s.). 

58 


CH.  III.]  THE   EFFECT   OF   WAR.  [§  36 

5.  Conditions  of  the  policy 

as  to  premium  and  forfeiture  for  non-payment  of  it  do  not  apply  to 

war  (§  39  A.), 
payment  to  agent  here  good  {§§  39  A.,  40). 
payment    to    agent    in  -South,    in  Confederate    money,    good   (?) 

(§39   A.), 
tender  and  refusal  of  one  premium  makes  tender  of  subsequent  dues 

unnecessary  (§  40  u. ). 
notice  and  i)roof  after  the  war  sufficient  (§  39  A.),  limitation  of  suit 

extended  by  war  (§  39  A.). 

6.  An  agency  in  a  hostile  country  (Spain,  for  example)   of  a  comi)any 

located  here, 
could  not  be  created  during  a  war  between  the  countries  (§§  36, 

42  s.). 
but,  if  previously  created,  it  would  not  be  revoked  or  suspended, 

except  as  to  the  taking  of  new  risks  and  the  transmission  of 

premiums  (§  40). 
premiums  accruing  on  contracts  made  before  the  war  could   be 

and  must  be  received  by  the  agent,  but  not  forwarded  till  after 

the  conflict  (§§  40  n.,  42  s.). 
of  an  English  company  would  be  neutral,  although  he  was  a  sub- 
agent   appointed   by  an    agent  of  the   English  company   who 

was  resident  here  (§  40). 

7.  When  war  begins  so  as  to  ati'ect  insurance  (§  38). 
In  civil  war  the  rules  are  the  same  (§  38). 
Mutual  companies  same  rules  (§  39  s.). 

§  36.  "War.  —  The  subjects  of  two  hostile  states  cannot 
make  a  valid  contract  of  insurance,  while  the  war  continues.^ 
And  it  has  even  been  held  that  an  English  underwriter  on 
French  property  in  time  of  peace  is  not  liable  for  a  loss 
occasioned  by  capture  by  British  ships  during  hostilities 
which  commenced  between  Great  Britain  and  France  subse- 
quent to  the  time  when  the  policy  was  made,  and  terminated 
prior  to  the  bringing  of  the  action.^  And  it  was  said,  in 
Brandon  v.  Curling,^  that  every  insurance  on  alien  property, 
by  a  British  subject,  must  be  understood  with  this  implied 
exception,  that  it  shall  not  extend  to  cover  any  loss  happen- 
ing during  the  existence  of  hostilities  between  the  respective 
countries  of  the  insured  and  the  insurer.  In  such  a  case, 
though  the  contract  is  legal  at  the  time  the  risk  commences, 

1  The  Hoop,  1  Robinson  (Eng.  Adm.),  196  ;  The  Emulous,  1  Gallison,  562, 
571  :  Griswold  v.  Waddington,  16  Johns.  (N.  Y.)  438. 

2  Gamba  v.  Le  Mesurier,  4  East,  407. 

3  4  East,  410. 

59 


§  37]  INSURANCE :   FIRE,   LIFE,  ACCIDENT,   ETC.  [CH.  III. 

and  the  insured  cannot  therefore  claim  a  return  of  the  pre- 
mium, yet  considerations  of  public  policy  are  so  stringent 
as  to  vitiate  a  once  valid  contract,  by  importing  into  it  an 
implied  condition  which  becomes  operative  upon  a  contin- 
fencv  beyond  the  control  of  either  of  the  parties.  ^  This 
last  case  was  decided  in  the  face  ot  a  practice  which  had 
grown  up  under  the  patronage  of  Lord  Mansfield,  who  went 
so  far  as  to  try  causes  in  which  the  same  question  arose,  and 
permitted  foreigners  in  their  own  names  and  for  their  own 
benefit,  during  the  war,  to  recover  on  policies  of  insurance 
on  foreign  goods  against  British  capture.  Yet  Lord  Alvan- 
ley,  though  he  could  not  help  animadverting  upon  the  im- 
morality of  the  defence,  felt  bound  to  sustain  it,  on  the 
ground  that  no  subject  can  be  permitted  to  enter  into  a  con- 
tract to  do  anything  which  may  be  detrimental  to  the  inter- 
ests of  his  own  country ;  and  that  such  a  contract  is  as  much 
prohibited  as  if  expressly  forbidden  by  an  act  of  Parliament. 
When  hostilities  commence  between  the  countries  of  the 
underwriter  and  the  insured,  the  former  is  forbidden  to  ful- 
fil his  contract. 

§  37.  Effect  of  War.  —  That  a  subject  may  not  enter  into 
such  a  contract  is  probably  more  than  was  meant  to  be  said; 
for  such  a  contract  is  certainly  legal  in  its  inception,  and 
its  invalidity  supervenes  upon  a  contingency  which  he  could 
not  foresee.  But  that  he  is  absolved  from  any  legal  obliga- 
tion to  fulfil  it,  and  will  not  be  compelled  by  the  courts  so 
to  do,  from  the  moment  when  it  proves  to  be  detrimental  to 
the  interest  of  the  state,  is  now  the  established  law.^  In 
Bell  V.  Gilson,^  the  judges  undertook  to  relax  somewhat  the 
severity  of  the  rule  in  favor  of  contracts  entered  into  be- 
tween British  subjects  about  property  purchased  of  the 
enemy  by  a  British  subject  during  the  war,  and  held  that 
property  so  purchased  should  not  be  considered  as  enemy's 

1  Furtado  v.  Rodgers,  3  Bos.  &  Pul.  191. 

2  See  3  Kent's  Com.  255  ;  and  Griswold  v.  Waddington,  16  Johns.  438,  where 
the  whole  subject  of  contracts  between  alien  enemies  is  discussed  with  great 
ability  and  research.  See  also  Mr.  Du  Ponceau's  note  to  his  translation  of 
Bynkershoeck  on  the  Laws  of  War,  p.  165. 

8  1  Bos.  &  Pul.  345. 

60 


CH.  Ill-]  THE   EFFECT   OF   WAR.  [§  38 

property.  But  this  case  was  afterwards  overruled,  and  the 
disability  to  contract  now  extends  alike  to  alien  enemies 
and  to  subjects  dealing  in  enemy's  property.  And  it  ap- 
pears now  to  be  the  law  of  England,  that  war  between  the 
two  countries  to  which  two  contracting  parties  respectively 
belong  suspends  a  contract  entered  into  before  the  breaking 
out  of  hostilities,  and  annuls  it  if  entered  into  while  hostili- 
ties continue.  1 

(s)  It  seems  also  that  the  law  will  not  permit  an  insur- 
ance company  to  indemnify  a  policy-holder  who  has  lost  his 
health,  life,  or  property  in  the  service  of  the  enemy,  whether 
loss  from  such  cause  be  excepted  in  the  policy  or  not.^  [If 
the  assured  joins  in  active  hostilities  his  life  policy  becomes 
void.-^J  This  was  also  the  doctrine  in  another  case  in  this 
country,^  where  there  was  a  provision  in  the  policy  which 
exempted  the  company  from  liability  if  the  insured  entered 
the  military  service,  and  it  appeared  that  he  was  upon  the 
staff  of  several  Confederate  generals,  though  he  had  no  com- 
mission. The  court  thought  this  entering  the  military  ser- 
vice within  the  meaning  of  the  policy;  but  put  the  case  upon 
the  broader  ground  of  public  law,  which  forbids  the  insur- 
ance of  the  life  of  a  person  who  enters  into  the  service  of 
the  enemy,  and  avoids  a  policy  for  that  reason,  without  any 
stipulation  to  that  effect,  and  even  though  the  policy  ex- 
pressly agreed  to  pay  if  the  death  occurred  in  such  service.^ 

§  38.  Effects  of  the  Civil  War.  —  The  question  of  the 
effect  of  the  late  civil  war  in  this  country  upon  the  relations 
of  parties  to  contracts  generally,  though  not  strictly  a  ques- 
tion of  insurance,  has  been  discussed  in  several  insurance 
cases,  which  it  may  be  useful  to  note  in  this  connection. 
The  general  doctrines  applicable  to  the  subjects  of  belliger- 

1  Ex  parte  Boussmaker,  13  Ves.  Jr.  71. 

2  Ex  parte  Lee,  13  Ves.  Jr.  64. 

3  [Sands  v.  N.  Y.  L.  Ins.  Co.,  50  N,  Y.  626;  Hamilton  v.  Mut.  L.  Ins.  Co.,  9 
Blatchf.  234.] 

*  Mitchell  I'.  Mut.  Life  Ins.  Co.  of  New  York,  not  reported,  but  cited  in  Bliss 
on  Life  Insurance,  643. 

5  See  also  New  York  Life  Ins.  Co.  v.  Clopton,  7  Bush  (Ky.),  179,  and  post. 
§  39. 

61 


§  39]  INSUEANCE  :   FIRE,   LIFE,   ACCIDI';NT,   ETC.  [CH.  IIL 

out  nations  have  been  declared  by  the  Supreme  Court  of  the 
United  States  to  be  also  applicable  to  the  hostile  parties  in 
the  late  civil  war;i  and  by  the  same  court  the  commence- 
ment of  the  period  of  belligerency  was  declared  to  be  the 
date  of  President  Lincoln's  first  proclamation  for  troops, 
though  elsewhere  ^  it  was  held  to  be  the  16th  of  August, 
1861,  the  date  of  the  proclamation  issued  by  the  President 
in  pursuance  of  the  non-intercourse  act  passed  by  Congress 
on  the  thirteenth  day  of  July  preceding;  and  domicile  in 
the  enemy's  territory,  without  regard  to  personal  sympathy, 
is  the  test  as  to  the  hostile  status  of  the  particular  individ- 
ual.3  And  the  line  of  demarcation  is  that  claimed  and  held 
by  the  belligerent  power.* 

§  39.  The  civil  war  had  not  the  effect  to  dissolve  a  con- 
tract of  life  insurance  entered  into  prior  to  its  commence- 
ment by  parties  belonging  to  the  respective  belligerents,  and 
kept  in  force  until  the  breaking  out  of  the  war.  While  in 
such  cases  as  partnership  and  affreightment,  where  the  per- 
formance is  continuous  and  unremitting  until  the  end  of  the 
contract  shall  have  been  consummated,  and  therefore  super- 
vening war  between  the  parties  disables  them  from  perform- 
ing any  of  the  incumbent  duties,  and  defeats  the  object  of 
the  contract,  a  dissolution  of  the  contract  is  the  natural  and 
legal  effect  of  the  war,  neither  the  principle  nor  policy  of 
the  law  will  avoid  a  pre-existing  and  valid  contract  which 
may  be  performed  by  a  single  act,  or  by  periodical  acts,  be- 
tween which  there  is  nothing  to  be  done  and  no  continuity 
of  performance,  such  as  the  payment  of  a  debt  or  the  pay- 
ment of  premiums.  In  such  a  case  the  suspension  of  the 
remedy  during  the  war  is  the  consistent  and  only  legitimate 
effect  of  the  war.  Belligerent  policy  interdicts  the  payment, 
because  it  might  aid  the  enemy  in  the  prosecution  of  hostili- 

1  Prize  Cases,  2  Black  (U.  S.),  635. 

2  Leathers  v.  Com.  Ins.  Co.,  2  Btish  (Kv.),  296,  298.  In  the  cases  of  The 
Protector  12  Wall.  (U.  S  )  700,  April  27,  1861,  the  date  of  the  proclamation  of 
intenrlpd  blockade  was  fixed  as  the  day. 

3  Mrs.  Alexander's  Cotton,  2  Wall.  (U.  S.)  404  ;  New  York  Life  Ins.  Co.  v. 
Clopton,  7  Bush  (Ky.),  179. 

*  Prize  Cases,  2  Black  (U.  S.),  635. 

62 


CH.  III.]         -  THE    EFFECT    OF   "WAE.  [§  39 

ties.  Suspension  of  the  performance,  therefore,  until  the 
restoration  of  peace,  will  effectuate  the  whole  aim  of  the 
law  without  dissolving  the  contract,  which  may  be  ultimately 
enforced  in  perfect  consistency  with  the  principle  and  end 
of  the  temporary  interdict.  In  such  a  case  it  is  the  con- 
tract, and  not  the  performance,  which  is  continuing;  and 
the  suspension  of  the  remedy,  and  not  a  dissolution  of  the 
contract,  is  all  that  is  necessary,  befitting,  or  just.i  [Con- 
trary vieivs  have,  however,  been  asserted  with  considerable 
force,  though  without  any  reasons  at  all  comparable  in 
weight  with  those  favoring  the  ordinary  opinion  that  the 
contract  is  only  suspended,   not  avoided  by  war. 2] 

(s)  The  ordinary  contract  of  insurance  does  not  belong  to 
the  class  of  contracts  of  continuing  performance.  It  is  sui 
generis,  governed  by  a  peculiar  and  rather  arbitrary  code  of 
the  modern  common  law,  but  recently  moulded,  and  not  yet 
stamped  in  all  respects  with  conclusive  authority.  Its  char- 
acter, however,  is  so  far  matured  and  established  as  to  dis- 
tinguish it  essentially  from  ordinary  commercial  contracts, 
and  especially  in  the  effect  of  war  on  its  pre-existing  valid- 
ity, which  the  war  as  a  general  rule  destroys,  whether  the 
contract  belongs  to  the  category  of  continuing  performance 
or  not.^  The  rule  is  the  same  where  the  insurers  are  a 
mutual  company.  The  relation  of  insurer  to  insured  is  not 
one  of  partnership.* 

1  [Insurance  is  not  ipso  facto  terminated  by  hostilities  which  make  the  in- 
sured and  insurer  public  enemies.  Statham  v.  N.  Y.  L.  Ins.  Co.,  45  Miss.  581  ; 
Cohen  v.  Mut.  L.  Ins.  Co.,  50  N.  Y.  610;  2  Ins.  Law  Jour,  426  ;  Manhattan  L. 
Ins.  Co.  V.  Warwick,  20  Grat.  614  ;  Hancock  v.  N.  Y.  L.  Ins.  Co. ,  2  Ins.  Law 
Jour.  903,  U.  S.  C.  C,  East.  Dist.  Va.  If  the  continuance  of  the  contract  implied 
commercial  intercourse  it  would  be  void.  But  it  does  not.  Sands  v.  N.  Y.  L. 
Ins.  Co.,  50  N.  Y.  626;  2  Ins.  L.  Jour.  2,)l  ;  Woods  v.  Wilder,  43  N.  Y.  164; 
Buchanan  v.  Curry,  19  Johns.  137;  Bell  v.  Chapman,  19  Johns.  183;  United 
States  V.  Wiley,  11  Wall.  508.] 

2  [Tait  V.  N.  Y.  L.  Ins.  Co.,  MSS.  U.  S.  C.  C,  West.  Dist.  of  Tenn.,  cited  by 
Bliss,  §  392  ;  also  Dillard  v.  Manhattan  L,  Ins.  Co.,  44  Ga.  119.] 

3  New  York  Life  Ins.  Co.  v.  Clopton,  7  Bush  (Ky.),  179.     See  also  post,  §  350. 

4  Hamilton  v.  Mut.  Life  Ins.  Co.,  9  Blatch.  C.  Ct.  234,  affirmed  by  an  equally 
divided  court  in  the  United  States  Supreme  Court  ;  iluttial  Benefit  Life  Ins.  Co, 
V.  Hillyard,  37  N.  J.  444  ;  Cohen  v.  Mut.  L.  Ins.  Co.,  50  N.  Y.  610.  Referring 
to  the  cases  of  Furtado  v.  Rodgers  and  Brandon  ,  Curling,  ante,  §  36,  where  it 
was  said  by  the  court,  —  the  question  arising  under  a  policy  of  marine  insurance,  — 

63 


§  39  A]  INSURANCE :   FIRE,   LIFE,    ACCIDENT,    ETC.  [CH.  III. 

[§  39  A.  War  and  the  Conditions  of  the  Policy.  Premiums^ 
notice,  and  proof.  Limitation  of  suit.  —  The  condition  of 
forfeiture  for  non-payment  of  premiums  does  not  contem- 
plate war.  If  within  a  reasonable  time  after  hostilities  have 
ceased  the  assured  pays  or  tenders  the  premiums  due,  no 
forfeiture  takes  place.  ^  If  there  is  an  agent  of  the  company 
in  the  country  of  the  assured,  a  tender  of  the  premium  to 
him  will  at  least  save  forfeiture.^  If  the  company  fail  to 
keep  an  agent  in  the  hostile  territory,  payment  of  the  pre- 
miums is  excused  till  after  the  w^ar.^  Payment  to  the  agent 
made  in  Confederate  money  is  good.^  If  loss  occurs  during 
the  war  the  assured  may  recover  on  giving  notice  and  proof 
within  a  reasonable  time  after  the  war.^     War  extends  the 

that  policies  entered  into  prior  to  the  war  became  void  by  the  supervention  of 
war,  as  in  every  such  policy  there  was  an  implied  condition  that  the  insurance 
should  not  extend  to  cover  any  loss  happening  during  the  existence  of  hostilities 
between  the  respective  countries  of  the  insured  and  the  insurer,  the  court,  in  the 
above  Kentucky  case,  observe :  "It  may  be  a  grave  question  whether  the  implied 
condition  as  to  the  perils  of  war  should  be  extended  beyond  the  belligerent  right  of 
capture  or  destruction  by  the  government  of  the  insurer,  and  to  that  extent  only 
we  may  admit  that  the  continuation  of  the  policy  during  the  war  would  be  illegal, 
and  its  pre-existing  obligation  become  avoided.  But  the  principle  of  this  conces- 
sion would  not  avoid  a  policy  insuring  property  which  is  exempted  by  law  from 
belligerent  power ;  and  while  it  would  avoid  a  policy  insuring  the  life  of  one 
who  becomes  an  actual  enemy  of  the  government  of  the  insurer,  which  had  the 
right  to  destroy  that  life,  it  would  not  affect  the  validity  of  the  insurance  of  the 
life  of  a  neutral  or  passive  non-combatant,  over  whose  life  there  is  no  belligerent 
power  ;  for  though  the  domicile  makes  him  a  technical  enemy,  whose  property 
may  be  lawfully  captured  as  enemy's  property,  yet  as  such  nominal  hostility  does 
not  subject  his  life,  like  his  estate,  to  peril,  no  belligerent  right  is  affected  by  the 
continued  validity  of  the  insurance ;  and,  consequently,  in  such  a  case  neither 
authority  nor  principle  would  avoid  a  policy  any  more  than  if  it  had  insured  the 
life  of  a  child  in  the  cradle,  or  insured  property  exempt  from  capture  or  confisca- 
tion." See  also  Manhattan  Life  Ins.  Co.  v.  Warwick,  20  Grat.  (Va.)  614;  Semmes 
V.  City  Fire  Ins.  Co.,  6  Blatch.  (C.  Ct.  U,  S.)  445  ;  s.  c.  in  the  Supreme  Court  of 
the  United  States,  13  Wall  (U.  S.)  158,  159.     See  also  post,  §  350. 

1  [Cohen  v.  Mut.  L.  Ins.  Co.,  50  N.  Y.  610.] 

2  [Hamilton  v.  Mut.  L.  Ins.  Co.,  9  Blatch.  234.] 

8  [Id. ;  Manhattan  Ins.  Co.  v.  Warwick,  20  Grat.  614.] 

*  [Sands  v.  N.  Y.  L.  Ins.  Co.,  50  N.  Y.,  626  ;  Robinson  v.  International  Ass. 
Soc,  42  N.  Y.  54.  Contra,  Manhattan  L.  Ins.  Co.  v.  Warwick,  20  Grat.  614 
(company  may  refuse  payment  in  Confederate  money).] 

5  [N.  Y.  L.  Ins.  Co.  v.  Clopton,  7  Bush,  179  ;  Cohen  v.  Mut.  L.  Ins.  Co.,  50 
N.  Y.  610  ;  Hillyard  v.  Mut.  Ben.  L.  Ins.  Co.,  35  N.  J.  415  ;  Sevms  v.  N.  Y.  L. 
Ins.  Co.,  U.  S.  C.  C.  South.  Dist.  Miss.  (MSS.).  Contra,  Dillard  v.  Manhattan 
L.  Ins.  Co.,  44  Ga.  119.1 

64 


CH.  III.]  THE    EFFECT    OF    WAR.  [§  40 

statute  of  limitations,  1  and  the  effect  upon  an  agreed  limita- 
tion would  no  doubt  be  the  same.] 

§  40.  Agency  as  affected  by  War.  —  Nor  does  the  OCCUr 
rence  of  war  revoke  the  powers  of  an  agent,  domiciled  in  the 
enemy's  country,  of  a  foreign  insurance  company,  having  a 
general  agency  managed  by  a  board  of  directors  in  the  coun- 
try of  the  other  belligerent,  by  whom  the  first-mentioned 
agent  is  appointed.  The  Virginia  agent  appointed  by  the 
resident  New  York  agency  of  a  London  office  is  the  agent  of 
a  neutral,  and  the  contract  of  insurance  effected  by  the  Vir- 
ginia ao-ent  with  a  citizen  of  that  State  in  behalf  of  the  com- 
pany  is  a  contract  between  a  neutral  and  a  belligerent,  and 
the  agent's  powers  are  not  revoked  by  the  breaking  out  of 
war. 2  And  even  the  agent,  resident  in  one  belligerent's  ter- 
ritory, of  a  company  established  in  the  territory  of  the  other 
belligerent,  may  (or  rather  must:)^  receive  payments  of  pre- 
miums as  they  fall  due,  and  thus  keep  alive  the  policy, 
though  he  may  not  remit  them,*  and  his  power  may  be  so 
far  suspended  that  he  cannot  negotiate  policies.^ 

1  [Semmes  v,  Hartford  Ins.  Co.,  13  Wall.  158  ;  Hanger  i;.  Abbott,  6  Wall. 
532  ;  The  Protector,  9  Wall.  687,  —  even  against  the  United  States,  see  United 
States  V.  Wiley,  11  Wall.  508.] 

2  Robinson  v.  International  Life  Assurance  Society  of  London,  42  N.  Y.  54  ; 
Martine  v.  International  Life  Assurance  Society  of  London,  62  Barb.  (N.  Y.) 
181.     See  also  post,  §  350. 

3  [It  is  the  agent's  duty  to  receive  the  premiums,  and  if  he  refuses,  the  as- 
sured may,  after  the  war,  bring  suit  for  the  breach  of  the  contract,  and  recover 
the  vaLie  of  the  policy  at  the  time  of  the  refusal.  Hancock  v.  N.  Y.  L.  Ins.  Co., 
2  Ins.  Law  Jour.  903  ;  Smith  v.  Charter  Oak  L.  Ins.  Co.,  Cent.  L.  Jour.,  Feb.  12, 
1874  (Mo. ).  After  one  tender  and  refusal  it  is  not  necessary  to  tender  the  sub- 
sequently accruing  [iremiums.  Id.  ;  and  Sands  v.  N.  Y.  L.  Ins.  Co.,  50  N.  Y. 
625  ;  Hamilton  y.  Mut.  L  Ins.  Co.,  9  Blatch.  234  ;  N.  Y.  L.  Ins.  Co.  v.  Ch.pton, 
7  Bush,  179;  Manhattan  L.  Ins.  Co.  v.  Warwick,  20  Grat.  614;  Statham  y.  N.  Y. 
L.  Ins.  Co.,  45  Miss.  581.] 

*  New  York  Life  Ins.  Co.  v.  Clopton,  7  Bush  (Ky.),  179  ;  Sands  v.  New  York 
Life  Ins.  Co.,  59  Barb.  (N.  Y.)  556;  Manhattan  Life  Ins.  Co.  v.  Warwick,  20 
Grat.  (Va.)  614.     And  see  post,  §  350. 

5  Wardy.  Smith,  7  Wall.  (U.  S.)  447,  452  ;  [N.  Y.  L.  Ins.  Co.  v.  Clopton, 
7  Bush,179.]  In  Dillard  v.  Manhattan  Life  Ins.  Co.,  44  Ga.  119,  it  was  held  that 
the  insured  had  no  right  to  pay  the  premiums  to  the  resident  agent  in  Geoi'gia 
after  the  war  broke  out,  nor  he  to  receive;  and  her  failure  to  pay  them  according 
to  the  stipulations  of  the  policy  prevented  her  recovery,  not  on  the  ground  of  for- 
feiture by  reason  of  the  failure,  which  the  court  said  would  be  excusable,  because 
to  pay  would  be  illegal,  but  because  the  company  having  contracted,  if  the  pre- 

voL.  I.  —  .5  65 


§  42]  INSURANCE  :   FIRE,   LIFE,    ACCIDENT,    ETC.  [CH.  III. 

S  41.  The  Lynchburg  Hose  Fire  Insurance  Company  v. 
Knox  was  a  case  where  the  company  sued  to  recover  on  a 
premium  note,  and  the  defence  was  that  war  had  abrogated 
the  contract.  But  it  was  held  that  the  war  merely  sus- 
pended the  contract.  1 

§  42.  In  Kershaw  v.  Kelsey,^  Mr.  Justice  Gray,  after  a 
learned  and  exhaustive  review  of  the  authorities  upon  the 
effect  of  war  upon  contracts  between  belligerents,  comes  to 
the  conclusion  that  the  law  of  nations,  as  judicially  declared, 
prohibits  all  intercourse  between  citizens  of  the  two  bellig- 
erents which  is  inconsistent  with  the  state  of  war  between 
their  countries,  and  that  this  includes  any  act  of  voluntary 
submission  to  the  enemy,  or  receiving  his  protection,  as  well 
as  any  act  or  contract  which  tends  to  increase  his  resources, 
and  every  kind  of  trading  or  commercial  dealing  or  inter- 
course, whether  by  transmission  of  money  or  goods,  or  orders 
for  the  delivery  of  either,  between  the  two  countries,  directly 
or  indirectly,  or  through  the  intervention  of  third  persons 
or  partnerships,  or  by  contracts  in  any  form  looking  to  or 
involving  such  transmission,  or  by  insurances  upon  trade 
with  or  by  the  enemy.  Beyond  the  principle  of  these  cases 
the  prohibition  has  not  been  carried  by  judicial  decision, 
and  the  more  sweeping  statements  of  the  text-books  rest 
upon  the  authority  of  dicta  which  are  shown  to  be  unsup- 
ported  by  the  facts  under  consideration.^ 

miums  are  paid  as  stipulated,  to  pay  a  certain  sum,  the  premiums  not  having 
been  so  made,  no  liability  had  been  incurred.  But  this  case  is  against  the  current 
of  authorities  on  both  points.  The  condition  in  this  case  was  the  usual  one,  that 
if  the  premium  was  not  paid  as  stipulated  the  policy  was  to  be  void.  In  Howell 
V.  Gordon,  in  the  same  State  (40  Ga.  302),  it  is  said  obiter  that  the  war  revoked 
the  powers  of  an  agent  in  Georgia  appointed  by  a  citizen  of  Massachusetts  to  take 
care  of  certain  lands  in  Georgia. 

1  Superior  court  of  the  city  of  Baltimore,  reported  in  the  Baltimore  Law  Tran- 
script, vol.  i.  Oct.  24,  1868.  The  opinion  is  given  in  extenso  in  the  iirst  edition 
of  this  work,  p.  37,  note. 

2  100  Mass.  561. 

3  The  learned  judge  continues  :  "  At  this  age  of  the  world,  when  all  the  ten- 
dencies of  the  law  of  nations  are  to  exempt  individuals  and  private  contracts  from 
injury  or  restraint,  in  consequence  of  war  between  their  governments,  we  are  not 
disposed  to  declare  such  contracts  unlawful  as  have  not  been  heretofore  adjudged 
to  be  inconsistent  with  a  state  of  war. 

(s)  ' '  The  trading  or  transmission  of  property  or  money  which  is  prohibited 

66 


CH.  in.]  THE    EFFECT    OF    WAR.  [§  42  A 

[§  42  A.  The  substance  of  the  whole  matter  is  that  public 
interests  overrule  private,  but  that  the  latter  should  be  in- 
terfered with  no  further  than  is  necessary  for  the  public 
purposes. 

The  tendency  of  international  law  is  to  impair  private 
concerns  as  little  as  possible  by  national  disputes  and  war- 
fare. ^  This  principle  evidently  requires  that  contracts  of 
insurance  should  be  left  intact  except  so  far  as  cut  down  by 
these  two  principles :  (1)  No  aid  or  support  must  go  to  the 
enemy  during  hostilities;  (2)  Citizens  of  this  country  shall 
not  contract  to  indemnify  citizens  of  another  country  against 
loss  by  acts  of  war  by  the  United  States.  Such  liabilities  if 
allowed  would  interest  our  citizens  in  the  success  of  the 
enemy.  This  is  the  common  sense  and  justice  of  the  mat- 
ter, and  the  thought  at  the  heart  of  the  law  of  it,  underlying 
and  justifying  the  principal  authorities  above  cited.] 

by  international  law  is  from,  or  to,  one  of  the  countries  at  war.  An  alien  enemj' 
residing  in  this  country  may  contract  and  sue  like  a  citizen.  When  a  creditor, 
although  a  subject  of  the  enemy,  remains  in  the  country  of  the  debtor,  or  has 
a  known  agent  there,  authorized  to  receive  the  amount  of  the  debt  throughout  the 
■war,  payment  there  to  such  creditor  or  his  agent  can  in  no  respect  be  construed 
into  a  violation  of  the  duties  imy)osed  by  a  state  of  war  upon  the  debtor  ;  it  is  not 
made  to  an  enemy  in  contemplation  of  international  or  rauTiicipal  law  ;  and  it  is 
no  objection  that  the  agent  may  possibly  remit  the  money  to  his  principal  in  the 
enemy's  country  ;  if  he  should  do  so,  the  offence  would  be  imputable  to  him,  and 
not  to  the  person  paying  hira  the  money."  [A  citizen  of  this  country  may  fullil 
a  contract  with  an  alien  enemy  during  war  time,  by  a  delivery  of  goods  to  the 
alien  enemy's  U.  S.  agent.  Buchanan  v.  Curry,  19  Johns.  137,  141.  But  the 
agent  must  have  been  appointed  before  the  war.  United  States  v.  Grossmayer, 
9  Wall.  72,  75.]  [The  law  does  not  presume  that  a  debt  will  be  paid  over  to  an 
enemy  during  war,  even  though  paid  to  his  agent.  Buchanan  v.  Curry,  19  Johns. 
137  ;  Denniston  v.  Imbric,  3  Wash.  C.  C.  396.] 

1  [Clarke  v.  Morey,  10  Johns.  69  ;  Scholefield  v.  Eichelberger,  7  Peters,  586  ; 
Bradwell  v.  Weeks,  13  Johns.  1.] 


67 


INSURANCE  :    FIRE,  LIFE,   ACCIDENT,   ETC.        [CH.  IV. 


Analysis. 


CHAPTER  IV. 

CONSUMMATION  OF  THE  CONTRACT. 
1. 


§§  43,  43  A.  The  contract  is  not  complete  until  the  parties  arrive  at  an  under- 
standing of  its  terms,  the  proposals  of  one  party  being  accepted 
by  the  other,  and  the  risk  does  not  attach  until  all  conditions 
precedent  are  fulfilled.  An  accepted  apjdication  or  a  renewal 
receipt  imports  an  agreement  to  issue  a  policy  (§  43 ;  see  also 
§  44).  Witness  may  state  facts,  but  not  his  opinion  that  the 
contract  was  complete  (§  43  A). 

§  43  B.  Terms  may  be  fixed  by  past  dealing. 

§  43  C.  The  contract  may  be  complete  without  payment  of  premium,  or 

giving  bond  to  pay  assessments  ; 

I  43  D.  and  in  spite  of  mistake  in  the  name  of  the  vessel  or  of  the  agent 

as  to  the  identity  of  the  assured  (§  43  D),  or  in  charging  a  less 
premium  than  he  ought  (§  43  E). 

§  43  E.  An  agreement  to  give  a  policy  on  a  certain  contingency  is  good  and 

enforceable  when  the  contingency  happens. 

2. 

§  43  F.  The  contract  is  not  complete  if  the  minds  of  the  parties  have  not 

met  on  the  terms  and  subject-matter,  as  on  account  of  writing  so 
bad  that  hoard  is  taken  for  hrick,  or  because  the  negotiations 
are  indeterminate  as  to  the  apportionment  of  the  insurance,  the 
amount  of  premium  original  or  additional,  the  company  or  the 
property  to  be  covered,  or  because  the  necessary  approval  has  not 
been  given. 

§  43  G.  A  loss  or  alteration  known  to  the  assured  before  completion  of  the 

contract,  and  undisclosed,  is  fatal. 

§  43  H.  An  application  and  delay  in  acting  on  it  is  not  sufficient  to  make 

a  contract.     The  ap]ilication  is  a  mere  ])roposal. 

§  44.  "  Binding-book."     Unorganized  company. 

§§  45,  45  a.  Execution  of  Poliaj  after  loss.  If  nothing  remains  to  be  done  but 
to  execute  what  has  been  agreed  upon,  the  company  is  bound, 
though  a  loss  happen  before  the  policy  is  made.  Recovery  may 
be  had  on  a  policy  issued  after  loss,  and  the  unpaid  premium  is 
a  credit  on  the  amount. 

§§  46-49.  Negotiations  by  Mail.      Some  cases  hold  the  contract  incomplete 

until  the  letter  of  acceptance  is  received ;  but  it  is  impossible  to 
make  any  rule  in  the  premises  that  shall  secure  a  certain  meeting 
of  minds  at  the  same  moment.     If  the  receipt  is  fixed  upon,  the 

68 


CH.  IV.]  CONSUMMATION    OF   THE    CONTRACT. 

insured  may  change  his  mind  between  the  mailing  and  the  de- 
livery of  his  acceptance.  If  the  time  of  mailing  governs,  still  the 
company  may  change  their  minds  before  that  time,  or  even  be- 
fore their  offer  reaches  the  insured.  A  mathematically  consis- 
tent solution  being  impossible,  convenience  and  practicality  must 
shape  the  rule,  and  to  hold  the  contract  completed  by  mailing 
the  acceptance  within  a  reasonable  time  and  before  notice  of 
withdrawal  is  best  for  the  despatch  and  definiteness  of  business. 
It  saves  a  prolonged  series  of  manreuvres  and  uncertainties  that 
could  result  in  no  good.  This  is  the  ride  adopted  by  the  United 
States  Supreme  Court,  and  by  the  great  weiglit  of  authority 
(Mass.  ?  §  48).  The  letter  must  be  properly  addressed  and 
stamped  (§  48  n.). 


§§  50-52.  Until  the  parties  have  agreed  on  the  terms  there  is  no  contract,  even 

though  the  premium  be  paid  or  the  agent  of  the  company  tell 
the  applicant  that  he  may  hold  himself  insured  (see  §  54). 
§§  54,  54  C.     Agreement  with  agent  subject  to  approval  of  the  principal. 

"Where  the  agent  insures  subject  to  disa[)proval,  reasonable  no- 
tice must  be  given  of  the  disapproval  (§  54  B).    An  applica- 
tion once  approved  cannot  be  arbitrarily  rejected  afterward 
(§  54  C). 
§  53,  Acceptance.     Unconditional  or  conditional  with  fulfilment  of  the 

condition  is  necessary  to  a  conii)lete  contract.  A  mere  mental 
assent  indicated  by  no  outward  expression,  silence  even  though 
long  contiimed,  or  a  letter  still  in  the  possession  of  the  writer, 
are  insufficient,  but  anything  which  amounts  to  a  vmnifestatimi 
of  a  formal  determination  to  accept,  communicated  or  put  in  the 
usual  and  projier  way  to  be  communicated  to  the  party  making 
the  offer,  completes  the  contract.  Indorsing  shipments  on  the 
policy  though  re(pured  by  the  contract  is  a  mere  form,  which 
the  company  cannot  refuse  after  loss. 

4. 

§  55.  Policy  may  be  held  for  payment  of  premium  if  so  agreed,  the  appli- 

cant having  the  option  to  take  or  refuse  the  policy.  In  this  case 
the  contract  is  not  complete  until  such  choice  is  exercised,  and 
payment  of  the  premium  by  a  stranger  without  knowledge  of  the 
applicant  is  not  sufficient. 

Life,  Neither  illness  nor  death  of  the  applicant  will  authorize  the  a»ent 

to  refuse  to  deliver  the  policy  on  tender  of  the  premium. 

§§  55  A,  56.  Delivery  and  payment.  Unless  made  so  by  law  or  agreement,  de- 
livery is  not  a  condition  precedent  to  a  complete  contract  (§§  43, 
55  A).  But  prima  facie  the  contract  is  incomplete  if  there  has 
been  neither  delivery  of  the  policy  nor  payment  of  premium. 
On  the  other  hand,  even  delivery  and  payment  combined  are  not 
conclusive  of  a  valid  contract.  Possession  of  the  policy  by  the 
insured  makes  a  prima  facie  case  for  him,  subject  to  proof  that 
it  was  not  delivered  to  him  with  consent  of  the  insurers  or  that 
it  is  void  for  fraud  or  error,  &c.  Possession  by  the  insurers 
leaves  the  presumption  with  them,  and  the  burden  is  on  the 

69 


insurance:    FIEE,   life,  accident,   etc.         [ch.  IV. 

insured  to  show  tliat  the  parties   intended  the  contract  to  be 

valid  without  further  action. 

What  constitutes  delivery  of  the  policy  is  a  question  of  intention 

on  the  i'acts.     No  formal  transfer  and  acceptance  is  necessary. 

The  agreement  on  all  the  terms  and  the  transmission  of  a  policy 

to  the  agent,  to  be  delivered  without  conditions  or  further  act 

on  the  part  of  the  insured,  is  equivalent  to  delivery  (§  60). 

delivery  may  be  made  by  mail,  but  the  policy  must  be  such  as 

the  applicant  is  bound  to  accept, 
delivery  of  the  policy  does  not  waive  the  condition  as  to  prepay- 
ment of  the  premium,  §  56. 
§§  57,  58.         Contract  with  agent,  payment  of  premium  and  receipt  subject  to 
approval  of  company.     Cases  not  entirely  consistent.     It  is  held 
that  the  company  cannot  be  allowed  to  reject  a  fair  contract 
merely  because  loss  has  intervened,  and  also  that  where  a  pre- 
mium is  paid  and  an  application  made  "  if  not  approved  money 
to  be  refunded  "  there  is  no  contract,  but  merely  a  proposal  for- 
warded by  the  agent.     It  is  sometimes  agreed  that  the  insurance 
shall  be  good  for  thirty  daj's  or  until  notice  of  disapproval. 
Neglect  of  the  agent  to  forward  the  application,  or  other  neglect  in 
the  scope  of  his  business  will  not  prejudice  the  insured,  §  58; 
(see  also  §  64). 
§  59.  Interim  receipts  bind  the  parties  by  the  conditions  of  the  policy  ordi- 

narily used  by  the  company,  except  as  to  conditions  of  which 
the  insured  is  ignorant  by  fault  of  the  company.  If  the  receipt 
is  broader  than  the  policy,  the  former  governs. 


§  61.  Obligations  mutual.     If  the  applicant  may  demand  a  policy,  the 

company  may  demand  the  premium.     This  is  clear  on  piinciple, 
though  there  are  decisions  to  the  contrary. 
§  62-64  A.        Charter  and  By-laws  (see  ch.  2  and  1). 

the  time  and  manner  of  contract  must  conform  to  charter,  §  63. 
if  a  deposit  note  is  required  by,  to  complete  the  contract  it  is 

essential,  §  63. 
all  who  take  out  policies  are  bound  by  existing  charter,  by-laws, 

and  statutes,  §  63  n. 
are  notice  to  all  dealing  with  the  company,  §  63,  c.  g.,  of  the 

powers  of  agents,  §  63  n. 
cannot  be  waived  by  the  officers,  §  63. 
contra,   in  favor  of  one  asking  for  by-laws  when  dealing  with 

agent  and  not  receiving  them,  §  62. 
company  may  however  be  bound,  though  the  charter  conditions 

are  not  fulfilled  before  loss,  §  64. 
an  agreement  to  issue  a  policy  failing  of  fulfilment  before  loss 

only  by  neglect  of  the  officer  binds  the  company,  §  64. 
subsequent  change  of  charter  or  by-law,  no  eH"ect  on  policy  unless 

so  agreed,  §  64  A. 
by-law  repugnant  to  policy  is  excluded,      64  A. 
mutual  company  policy-holder  becomes  a  member  of  the  company, 

and  is  bound  as  such,  §§  62-64  A. 

70 


CH.  IV.]       CONSUMMATION  OF  THE  CONTRACT.         [§  43 

by-laws  not  part  of  contract  in  Massachusetts  unless  incorpo- 
rated in  full  into  the  policy.     Pub.  Stats.  712. 

§  65.  Countersignature  of  the  agent  is  necessary,  if  required  by  the  terms 

of  the  policy  or  by  the  charter.  A  waiver  or  equivalent  of  the 
ceremony  is  however  possible  ;  for  example,  by  delivery  of  the 
policy  without  the  signature,  but  proof  of  proper  delivery  is 
essential. 

§§  66,  66  A.  The  place  of  contract,  by  the  law  of  which  its  validity  is  determined, 
is  the  location  of  the  home  office  if  accepted  and  completed  there, 
but  if  countersigning  by  the  agent  is  necessary,  or  the  policy  is 
to  be  delivered  only  on  receipt  of  the  premium,  the  contract  is 
completed  at  the  place  of  the  agency. 

§  66  A.  Interpretation  may  be  governed  by  another  law  than  the  validity. 

Division  of  a  State  does  not  atfeet  existing  contracts. 

§  43.  Contract,  when  completed.  —  From  the  extent  and 
peculiar  character  of  the  operations  of  insurance  companies 
and  their  agencies  questions  frequently  arise,  sometimes  of 
great  difficulty,  as  to  the  fact  whether  any  contract  has  been 
made.  Negotiations  have  been  had,  but  have  they  resulted 
in  a  contract?  This,  of  course,  depends  upon  the  question, 
whether  the  respective  parties  have  come  to  an  understand- 
ing upon  all  the  elements  of  the  contract,  —  the  parties 
thereto ;  the  subject-matter  of  insurance ;  the  amount  for 
which  it  is  to  be  insured;  the  limits  of  the  risk,  including 
its  duration  in  point  of  time,  and  extent  in  point  of  hazards 
assumed ;  the  rate  of  premium ;  and,  generally,  upon  all  the 
circumstances  which  are  peculiar  to  the  contract  and  dis- 
tinguish it  from  every  other,  so  that  nothing  remains  to  be 
done  but  to  fill  up  the  policy  and  deliver  it  on  the  one  hand,, 
and  pay  the  premium  on  the  other.  If,  upon  all  these  points, 
an  agreement  has  been  arrived  at,  and  no  stipulation  is  made 
that  the  delivery  of  the  policy  shall  be  the  test  of  the  con- 
summation of  the  contract,  and  no  law  makes  such  delivery 
a  condition  precedent  to  its  validity  from  that  time,  unless 
another  time  is  fixed,  the  contract  is  complete,  and  binds 
the  parties.  The  policy,  as  we  have  seen,^  is  not  essential 
to  its  validity.  It  is  but  the  form  and  embodiment,  the 
expression  and  evidence,  of  what  has  already  been  agreed 
upon,  adding  nothing  thereto  and  detracting  nothing  there- 
from.    And  whether  issued  immediately  upon  the  arrival  at 

^  Ante,  ch.  ii. 

71 


§  43  A]  INSURANCE :    FIRE,   LIFE,   ACCIDENT,    ETC.  [CH.  IV. 

a  mutual  understanding,  or  subsequently,  before  the  loss  or 
after  the  loss,  with  or  without  knowledge,  or  not  issued  at 
all,  the  obligations  of  the  parties  are  not  affected.  If  the 
insurers  refuse  under  such  circumstances  to  issue  a  policy 
because  a  loss  has  intervened,  or  any  other  change  has  taken 
place  which  would  not  be  a  defence  under  the  policy  if  that 
had  been  delivered,  they  will  not  be  allowed  by  the  law  to 
take  advantage  of  the  fact  that  no  policy  has  been  issued, 
but  in  divers  modes,  stated  in  another  place,  ^  will  be  com- 
pelled to  recognize  their  obligations  just  as  fully  as  if  a  pol- 
icy had  been  issued.  An  accepted  application  imports  an 
agreement  to  issue  the  policy  used  by  the  insurers  in  exe- 
cution of  the  contract ;  and  this  policy,  when  issued,  becomeg 
the  evidence  of  the  contract.-  In  Lightbody  v.  North  Amer- 
ican Insurance  Company,  the  premium  having  been  paid 
and  a  receipt  taken,  it  was  held  that  insurance  related  back 
to  the  date  of  the  receipt,  though  the  policy  was  not  deliv- 
ered till  some  three  weeks  after,  and  after  the  fire.^  If  the 
terms  of  the  policy  transmitted  for  delivery  be  changed  by 
an  authorized  agent  upon  further  negotiation  with  the  in- 
sured, the  insurance  will  take  effect  from  the  change,  and 
not  from  the  date  of  the  policy."* 

[§  43  A.  The  Contract  is  Complete  when  the  terms  are 
fixed,  and  everything  which  by  law  or  agreement  was  made 
a  condition  precedent  to  liability,  has  been  done.  All  the 
terms  must  be  agreed  on  and  everything  be  done  but  filling 
up  and  delivery  of  the  policy,  on  one  side,  and  paying  the 
premium  on  the  other  ;5  and^  as  we  shall  see,  payment  of 
the  premium  is  usually  made  a  condition  precedent,  and  de- 
livery  may  be  also.  A  slip  of  policy  containing  the  terms 
of  insurance  is  a  binding  contract,  and  puts  the  risk  on  the 
company. 6  A  contract  to  insure  the  life  of  the  applicant  for 
•^15,000,  payable  to  his  wife,  according  to  the  form  of  policy 

1  Post,  §§  565,  566. 

2  Fuller  V.  iladison  Mut.  Ins.  Co.,  36  Wis.  599  ;  ante,  §  23. 

3  23  Wend.  (X.  Y.)  18.     And  see  post,  §  130. 

*  Gloucester  Manuf.  Co.  v.  Howard  Ins.  Co.,  5  Gray  (Mass.),  497. 
[Peoples  Ins.  Co.  v.  Paddon,  8  Brad.  447.] 

*  [Thompson  v.  Adams,  23  Q.  B.  D  361  1 
72 


CH.  IV.]  CONSUMMATION    OF    THE    CONTRACT.  [§  43  C 

in  use  by  the  company,  is  sufficiently  certain  to  be  enforced. i 
It  is  incompetent  for  a  witness  to  say  that  in  his  opinion 
insurance  is  effected  and  completed  by  the  acceptance  of 
the  order.  2] 

[§  43  B.  Terms  fixed  hy  Past  Dealings.  —  If  the  agreement 
is  silent  as  to  the  rate  of  premium,  duration  of  policy,  or 
other  essential  matter,  standing  alone  it  is  void  for  uncer- 
tainty, but  it  may  be  aided  by  past  transactions  between  the 
same  parties,  these  elements  being  presumed  to  continue  the 
same  in  the  new  contract.^  Where  F.,  an  insurance  agent, 
had  for  several  years  insured  the  property  of  W.,  each  time 
for  a  year,  and  a  new  contract  of  insurance  is  made,  no  pre- 
mium or  duration  of  risk  being  specified,  and  the  property 
burns  before  delivery  of  the  policy,  it  will  be  presumed  that 
the  premium  and  duration  were  intended  to  be  the  same  as 
in  the  past,  and  the  minds  of  the  parties  will  be  held  to  have 
met  in  a  complete  contract.^] 

[§  43  C.  Contract  may  he  complete  without  Premium,  or 
Bond  to  pay  Assessynents.  —  Where  all  the  details  of  the  in- 
surance were  agreed  on  between  a  broker  and  the  company's 
agent,  and  the  premium  fixed,  and  there  was  evidence  of  a 
usage  to  give  the  broker  credit  on  premiums  to  the  end  of 
the  month,  the  contract  was  held  complete.^  Where  the 
plaintiff  asks  the  agent  for  insurance,  and  he  examines  the 
property  and  agrees  with  the  plaintiff  as  to  the  amount  of 
insurance  on  each  parcel,  the  preliminary  survey  is  complete 
except  the  plaintiff's  given  name,  the  survey  is  handed  to 
the  secretary  and  approved  by  him,  the  record  is  made  in 
the  books  of  the  company,  the  secretary's  fee  for  the  policy 
is  paid,  and  the  agent  tells  the  plaintiff  her  insurance  is  all 
right,  and  the  policy  will  be  along  in  due  time,  the  contract 
is  complete  although  the  plaintiff"  had  not  executed  the  bond 
to  pay  all  assessments,   it  being  customary  to  execute  that 

1  [Hebert  v.  Mut.  L.  Ins.  Co.,  12  Fed.  Rep.  807  (Or.),  1882,  14  Repr.  198, 
8  Sawy.  198  ;  s.  c.  sub  noni.  Herbert  v.  Mut.  L.  Ins.  Co.,  11  Ins.  L.  J.  667.J 

2  [Lindauer  v.  Delaware  Ins.  Co.,  13  Ark.  461,  470.] 

3  [Home  Ins.  Co.  v.  Adler,  71  Ala.  516.] 

*  [Winne  v.  Niagara  F.  Ins.  Co.,  91  X.  Y.  190.] 
6  [Ruggles  V.  Am.  Cent.  Ins.  Co.,  114  N.  Y.  418.] 

73 


§  43  EJ  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.-  [CH.  IV. 

when  the  policy  was  delivered.  There  is  nothing  doubtful 
about  such  a  contract.  The  record  on  the  company's  books 
is  the  basis  of,  and  substantially  the  same  as  the  policy,  and 
it  is  evident  that  the  company  intended  to  insure  the  plain- 
tiff; the  minds  of  the  parties  had  met.^] 

[§  43  D.  Contract  complete  in  spite  of  Mistake  in  Name  of 
Vessel,  or  in  regard  to  the  Identity  of  tlie  Assured.  —  There 
can  be  no  contract  of  insurance,  and  hence  no  liability, 
where  the  parties'  minds  do  not  meet  as  to  the  object  of  in- 
surance.^ But  a  mere  mistake  in  the  name  of  the  vessel  is 
of  no  moment  if,  in  fact,  both  parties  had  in  mind  the  same 
ship.  An  instruction  that  if  the  insurance  agent  making  a 
policy  to  J.  E.  Travis,  at  the  instance  of  Dr.  Joseph  Travis, 
agent  of  J.  E.  Travis,  supposed  that  the  doctor  was  the  per- 
son being  insured,  then  the  policy  is  not  a  contract  with  J. 
E.  Travis,  is  error.  If  there  was  fraud,  on  the  part  of  the 
insured,  if  he  knew  the  mistake  under  which  the  insurer 
was  laboring,  and  failed  to  remove  his  error,  he  could  not 
hold  the  company;  but  where  there  has  been  no  misrepre- 
sentation or  suppression  of  truth  by  the  insured  in  such  a 
case  of  mistaken  identity,  the  policy  is  good. ^  (a)] 

[§  43  E.  Agreement  to  give  a  Policy  on  a  certain  Contin- 
gency good.  —  An  agreement  to  insure  a  cargo  to  be  laden, 
if  the  vessel  sail  within  a  given  time,  which  provides  means 
for  ascertaining  the  amount  to  be  covered,  and  the  rate  of 
premium,  when  lading  is  done  and  the  vessel's  sailing  day 
fixed,  though  these  are  contingent,  is  valid,  and  the  insurers 
are  bound  to  give  a  policy  on  the  vessel's  sailing  within  the 
given  time,  and  the  insured  is  bound  to  pay  the  premium 
accordingly;  and  the  issuing  of  a  policy  on  such  an  agree- 
ment, with  material  errors  resulting  from  the  agent's  mis- 
take, and  the  agent's  further  error  in  charging  a  less 
premium  than  is  usually  charged,  or  than  he  had  authority 

^  [Van  Loan  v.  Farmers'  Mut.  F.  Ins.  Co.,  24  Hun,  132.] 
2  [Hughes  V.  Mercantile  Mut.  Ins.,  55  N.  Y.  265,  268.] 
8  [Travis  v.  Peabody  Ins.  Co.,  28  W.  Va.  583,  598.] 

(a)   An  insurance  policy  is   not  in-     r.   Hamburg-Bremen   F.  Ins.  Co.,  13b 
valid   because  no   particular   person  is     N.  Y.  394. 
therein  named  as  the  assured.     Weed 
74 


CH.  IV.]  CONSUMMATION    OF   THE   CONTKACT.  [§  43  G 

to  charge,  do  not  impair  the  policy,  and  the  plaintiff  may 
recover  after  deducting  the  balance  of  unpaid  premium.  ^J 

[§  43  F.  When  the  Contract  is  not  complete.  —  If  the 
minds  of  the  parties  have  not  met  on  all  the  essential  terms 
there  is  no  contract.^  Where  the  applicant  writes  "board  " 
so  poorly  that  the  company  take  it  for  "brick,"  and  issue  a 
policy  on  a  brick  building,  the  minds  of  the  parties  did  not 
meet. 3  Where  there  is  to  be  some  apportionment  of  the  in- 
surance between  mill  and  machinery,  and  what  the  division 
shall  be  has  not  been  agreed  on,  the  contract  is  not  com- 
plete.^ Where  an  additional  premium  is  left  undetermined, 
and  it  is  a  condition  precedent  to  recovery,  it  must  be  fixed 
and  paid  to  make  the  company  liable.^  Clifford,  J.,  dis- 
sented to  both  cases  on  the  ground  that  the  premium  was 
left  to  be  fixed  according  "to  the  established  rate  at  the 
time  of  shipping,  &c.,"  which  was  determinate,  and  if  by 
the  company's  fault  in  demanding  a  rate  above  the  one  in- 
dicated the  premium  was  not  paid,  the  company  was  not 
freed.  Where  the  terms  are  decided  upon  by  the  agent  and 
the  insured,  but  no  company  designated,  and  no  company 
agrees  to  take  the  risk  on  the  said  terms,  there  is  no  con- 
tract.^ If  the  agent  acts  for  several  companies,  and  no  par- 
ticular company  is  named  in  the  negotiations,  or  fixed  by 
prior  dealings,  the  contract  is  not  complete."  The  contract 
is  not  complete  until  the  property  to  be  covered  has  been 
specifically  designated.^  When  anything  remains  to  be 
done  before  the  insurance  takes  effect,  for  example,  ap- 
proval, it  is  absolutely  void  if  that  precedent  condition  is 
not  performed.^] 

[§  43  G.     Completio7i  after  Loss  or  Alteration  undisclosed  is 

1  [Bunteu  v.  Orient  Mut.  Ins.  Co.,  8  Bosw.  448.] 

2  [Bishop  of  C.  V.  Western  Ass.  Co.,  22  N.  B.  R.  242.] 

3  [Smith  V.  City  of  London  Ins.  Co.,  11  Ont.  R.  38,  50.] 

*  [Kimball  v.  Lion  Ins.  Co.,  17  F.  Rep.  625  (R.  I.),  1883.] 

5  [Orient  Mut.  Ins.  Co.  v.  Wright,  23  How.  401  ;  San  Mutual  v.  Wright,  23 
How.  412,  413.] 

«  [Sheldon  v.  Hekla  F.  Ins.  Co.,  65  Wis.  436.] 

■^  [Xew  Orleans  Ins.  Ass.  v.  Boniel,  20  Fla.  815.] 

8  [Matoon  Manuf.  Co.  v.  Oshkosh  Mut.  F.  Ins.  Co.,  69  Wis.  564.] 

•  [Winnesheik  v.  Hokgrafe,  53  111.  516.     See  §§  55,  57-58.] 

75 


§  44]  INSURANCE  :    FiKE,   LIFE,   ACCIDENT,    ETC.  [CH.  IV. 

insufficient. A  contract  not  completed  till  after  loss,  and 

when  the  insured  knew  of  the  loss,  is  bad,  although  the 
policv  is  antedated.  1  If  there  is  a  material  alteration  be- 
tween tlie  acceptance  of  the  proposal  and  the  tender  of  the 
premium,  the  company  is  not  bound  to  accept  it.^] 

[§  43  H.  ApjyUcation,  and  Delay  in  acting  on  it,  insuffi- 
cient. —  An  application  is  not  a  contract  but  a  mere  offer, 
or  proposal,  which  may  be  rejected, ^  and  it  cannot  be  con- 
verted into  a  contract  by  delay  in  acting  upon  it.*  An  ap- 
plication to  a  mutual  company  was  sent  August  9.  At  the 
next  regular  meeting  of  the  company,  September  25,  it  was 
rejected.  This  was  held  a  reasonable  time,  and  the  com- 
pany was  not  accounted  liable  for  a  loss  in  the  mean  time.^ 
Silence  after  a  proposal  is  not  consent  unless  there  is  a  duty 
to  speak.  Where  the  insured  applied  to  have  the  policy 
continued  in  force  temporarily,  and  received  no  reply,  no 
liability  of  the  company  was  created.^] 

§  44.  "  Binding-book.  "  Unorganized  Company.  —  The  agree- 
ment for  insurance  is  complete  when  the  terms  thereof  have 
been  agreed  upon  between  the  parties,  and  the  reciprocal 
rights  and  obligations  of  the  insurer  and  the  insured  date 
from  that  moment,  without  reference  to  the  execution  and 
delivery  of  the  policy,  unless  these  two  elements  are  em- 
braced within  the  terms  agreed  upon.  The  contract  imports 
an  obligation  on  the  part  of  the  insurer  to  execute  and  de- 
liver a  policy  to  the  insured.  Thus,  where  a  renewal  receipt 
was  taken  for  a  policy  payable  to  a  mortgagee  to  the  extent 
of  his  interest,  and  a  policy  was  issued  by  mistake  directly 
to  the  mortgagee  as  the  insured,  and  after  loss  the  mort- 
gagee was  paid  with  the  assent  of  the  mortgagor,  it  was  held 
that  the  latter  might  maintain  an  action  for  the  balance  of 


1  [Wales  V.  N.  Y.  Bowery  F.  Ins.  Co.,  37  Minn.  106.] 

2  [Canning  v.  Farquhar,  16  Q.  B.  D.  727.] 

^  [Covenant  Mut.  Ben,  Ass.  v.  Conwa}%  10  Brad.  348  ;  Eowland  v.  Spring- 
field F.  &  M.  Ins.  Co.,  18  Brad.  601.  (The  company  must  act  promptly,  how- 
ever, and  return  the  premium).] 

*  [Heiman  v.  Phoenix  Mut.  L.  Ins.  Co.,  17  Minn.  153.] 

5  [Harp  V.  Grangers'  Mut.  F,  Ins.  Co.,  49  Md,  307,  309.] 

6  [Roval  Ins.  Co.  v.  Beabty,  119  Pa.  St.  6.] 

76 


CH.  IV.]      CONSUMMATION  OF  THE  CONTRACT.         [§  45 

the  amount  insured,  on  the  agreement  for  a  policy  as  by  his 
receipt  appeared.^  So,  liability  was  enforced  in  the  follow- 
ing somewhat  anomalous  case :  A  mutual  company,  Avhose 
charter  provided  that  it  might  organize  and  proceed  to  busi- 
ness when  fifty  applications  had  been  procured,  and  that  any 
person  might  become  a  member  by  subscribing  to  an  appli- 
cation and  paying  a  certain  sum  stated,  but  that  there  should 
be  no  liability  until  fifty  applicants  had  been  obtained,  hav- 
ing procured  the  requisite  number,  organized  and  voted  to 
issue  policies.  Before  any  policy  was  issued  the  loss  oc- 
curred. The  directors  refused  to  issue  a  policy  or  to  recog- 
nize the  claim.2  And  on  the  completion  of  the  negotiations, 
the  policy,  executed  in  accordance  therewith,  and  dated  on 
the  day  of  the  completion,  though  not  actually  delivered  till 
afterwards,  or  at  all,  or  if  antedated  when  executed  and 
delivered,  will  take  effect  from  its  date,  unless  some  other 
terms  are  expressly  agreed  upon.^  It  is  a  customary  thing 
for  an  insurance  agent  to  bind  his  principal  by  an  oral 
agreement,  a  memorandum  of  which  he  inserts  in  his  "  bind- 
ing-book," so  called.* (a) 

§  45.  Distinction  between  Policy  and  Agreement  to  insure. 
—  There  is  at  least  a  technical  distinction  between  a  con- 
tract of  insurance  or  policy  and  an  agreement  to  insure. 
The  latter  may,  and   in    point  of  fact  does,  exist   prior  to 

1  Akin  V.  Liverpool,  &c.  Ins.  Co.,  C,  Ct.  (Ark.),  6  Ins.  L.  J.  341. 

2  Van  Slyke  v.  Trempealeau  County,  &c.  Ins.  Co.  (Wis.),  9  Ins.  L.  J.  633. 

3  Lightbody  v.  North  Am.  Ins.  Co.,  23  Wend.  (N.  Y.)  18  ;  Hallock  v.  Com- 
mercial Ins.  Co.,  2  Dutch.  (N.  J.)  268  ;  s.  c.  affirmed,  3  id.  645  ;  Flint  v.  Ohio 
Ins.  Co.,  8  Ohio,  501  ;  Xenos  v.  Wickham,  2  Law  Repts.  (H.  L.)  296  ;  Ameri- 
can Horse  Ins.  Co.  v.  Patterson,  28  Ind.  17 ;  Lefavour  v.  Insurance  Co.,  1  Phila. 
558  ;  Baldwin  v.  Chouteau  Ins.  Co.,  56  Mo.  151  ;  post,  §  45  a. 

*  Putnam  v.  Home  Ins.  Co.,  123  Mass.  324  ;  ante,  §§22,  23. 

(a)  Where,  upon  brokers  appljing  for  to  the  brokers  about  four  o'clock,  it  was 
insurance  from  the  defendant,  which  was  held,  the  fire  occurring  shortly  after  three 
agreed  to,  a  binding  slip  was  given  until  o'clock,  that  the  slip  nmst  be  construed 
the  regular  policy  could  be  made  out,  as  if  it  expressed  that  the  insurance 
and  later  in  the  day  the  defendant  sent  was  under  the  conditions  of  the  ordinary 
a  messenger  to  notify  the  brokers  that  policy.  Karelsen  v.  Sun  Fire  Office, 
it  declined  the  risk,  but  their  office  being  122  N.  Y.  545.  See  infra,  %  59;  Un- 
closed, the  notice  was  duly  given  the  derwood  v.  Greenwich  Ins.  Co.,  161 
next  day,  according  to  the  defendant  N.  Y.  413,  659  ;  Phcenix  Ins.  Co.  v. 
not  later  than  half-past  one,  according  Hale  (Ark.),  55  S.  W.  486. 

77 


§  45  a]        INSUKANCE :   fire,  life,  accident,  etc.        [ch.  IV. 

the  drawing  up  and  the  delivery  of  the  policy,  and  contem- 
plates the  delivery  of  the  policy  as  the  consummation  of  the 
aia'cenicnt.  And  upon  this  distinction  much  important  and 
interesting  litigation  has  arisen.  It  being  settled  that  in 
surers  may  now  become  liable  for  a  loss  although  they  may 
not  have  issued  a  policy,  the  question  often  arises,  when 
that  liability  is  fixed ;  in  other  words,  when  the  negotiations 
have  reached  such  a  point  that  if  the  insurers  refuse  to  issue 
a  policy  the  courts  will  interpose  to  compel  them  to  issue 
one,  or  to  indemnify  the  insured  to  the  same  extent  and  in 
like  manner  as  if  they  had  issued  a  policy.  This  interposi- 
tion will  usually  be  successfully  invoked  when  the  negotia- 
tions have  reached  such  a  point  that  nothing  remains  to  be 
done  by  either  party  but  to  execute  what  has  been  agreed 
upon.  Thus,  in  Kohne  v.  Insurance  Company  of  North 
America,  1  the  plaintiff's  agent  applied  for  insurance,  and 
agreed  upon  all  the  terms,  but  left  the  office  before  the  pol- 
icy was  filled  out.  This,  however,  was  filled  out  within  a 
few  hours,  and  notice  thereof  given  by  the  company,  accom- 
panied, however,  by  notice  that  the  company  had  received 
information  that  a  loss  had  happened.  On  calling  for  the 
policy  and  tendering  the  premium,  the  agent  was  refused, 
on  the  ground  that  a  loss  had  happened  before  the  delivery, 
and  the  contract  was  not  complete.  But  the  court  held 
otherwise,  as  everything  had  been  agreed  on,  and  nothing 
remained  to  be  done  but  to  carry  out  the  terms  already 
agreed  on;  and  the  plaintiff  had  a  verdict.^ 

§  45  a.  Policy  executed  after  Loss.  —  As  another  practical 
illustration  of  the  doctrine  that  where  the  parties  have  come 
to  an  agreement  upon  all  the  terms,  and  nothing  remains 
but  to  execute  what  has  already  been  agreed  upon,  a  policy 
must  issue,  may  be  stated  the  case  of  Mead  v.  Davidson,^ 
where  it  appeared,  in  an  action  on  a  policy  on  a  ship,  "lost 

1  1  Wash.  (U.  S.  C.  C.)  93. 

2  This  case  was  trover  for  the  policy.  The  amount  of  damages  is  not  stated 
in  the  case  as  repoi-ted,  but  it  was  undoubtedly  the  same  as  if  the  plaintiff  had 
sued  and  recovered  on  the  policy,  had  it  been  delivered.  See  also  Goodall  v. 
New  England  j\Iut.  Fire  Ins.  Co.,  5  Fost.  (N.  H.)  169. 

8  4  Ad.  &  Ell.  303,  iu  the  K.  B. ;  ante,  §  44. 

78 


CII.  IV.]  CONSUMMATION    OF   THE    CONTRACT.  [§  46 

or  not  lost,"  that  the  risk  had  been  accepted  and  the  pre- 
mium paid  before  loss ;  but  before  the  delivery  of  the  policy 
—  what  was  not  known  to  either  party  at  the  time  the  agree- 
ment was  made  and  the  premium  paid  —  it  came  to  the 
knowledge  of  both  parties  that  a  loss  had  happened,  not- 
withstanding which  the  company,  recognizing  their  obliga- 
tion under  the  agreement,  executed  and  delivered  a  policy  in 
accordance  therewith.  And  the  question  was  whether  such 
a  policy,  so  executed  after  knowledge  on  the  part  of  both 
parties  of  the  loss,  could  be  upheld.  Upon  this  point  the 
court  had  no  doubt.  The  delivery  was  only  in  execution  of 
what  the  company  had  agreed  to  do  upon  sufficient  consider- 
ation. ^  So,  also,  where  a  policy  was  renewed  by  payment 
of  premium  to  an  agent  of  the  company,  who  gave  a  receipt 
therefor,  but  the  general  agent  declined  to  renew,  but  paid 
the  money,  October  16,  to  the  defendants,  who  on  the  same 
day  issued  a  policy,  based  on  the  application  to  the  former 
insurance  company,  covering  the  premises  for  one  year  from 
October  2d.  The  property  was  destroyed  on  the  13th  Octo- 
ber. The  plaintiff  did  not  know  of  the  last  transaction  till 
he  received  the  policy.  It  was  held  that  the  plaintiff  might 
recover,  there  being  no  fraud;  that  the  statements  in  the 
application  were  to  be  taken  as  of  October  2d,  and  that  the 
insurance  was  in  effect  "burnt  or  not  burnt. "^  [Recovery 
may  be  had  on  a  policy,  issued  after  loss  in  pursuance  of  a 
prior  parol  agreement,  and  the  unpaid  premium  is  a  credit 
on  the  amount  recoverable  on  the  policy.^] 

§  46.  Negotiation  by  Correspondence.  —  When  the  nego- 
tiations are  carried  on  by  correspondence  through  the  mail, 

1  Excelsior  Fire  Ins.  Co.  v.  Roj'al  Ins.  Co.,  55  N.  Y.  343  ;  Marx  v.  National 
Mar.  Ins.  Co.,  25  La.  An.  39  ;  City  of  Davenport  v.  Peoria  Fire  Ins.  Co.,  17  Iowa, 
276  ;  Baldwin  v.  Chouteau  Ins.  Co.,  56  Mo.  151  ;  Insurance  Co.  v.  Colt,  20  Wall. 

"  (U.  S.)  560  —  the  last  two  cases  where  credit  was  given  for  the  premiura,  which 
was  paid  after  the  loss,  the  insurers  not  knowing  of  the  loss,  —  and  Keira  v. 
Home  Mut.  Ins.  Co.,  42  Mo.  38,  where  the  facts  were  similar,  and  the  policy, 
delivered  after  the  loss,  provided  that  it  should  not  take  effect  till  the  premium 
was  paid. 

2  Giffard  v.  Queen  Ins.  Co.,  1  Hannay  (N.  B.),  432.  See  also  Horter  v.  Mer- 
chants' Mut.  Ins.  Co.,  28  La.  An.  730. 

3  [Home  Ins.  Co.  v.  Adler,  71  Ala.  516.] 

79 


§  47]  INSURANXE  :     FIRE,   LIFE,    ACCIDENT,   ETC.  [CII.  IV. 

the  precise  point  at  which  the  contract  becomes  binding  on 
both  parties  has  been  the  subject  of  diverse  opinions  held  by 
equally  distinguished  tribunals.  On  the  one  hand,  it  has 
been  held  that  when  a  party  applies  for  insurance  by  letter, 
and  receives  a  reply  stating  the  terms  upon  which  the  insur- 
ance can  be  had,  to  which  the  applicant  replies  accepting 
the  terms,  the  contract  does  not  become  binding  until  the 
letter  of  acceptance  is  received,  or,  at  all  events,  the  fact  of 
acceptance  has  in  some  way  come  to  the  knowledge  of  the 
insurers.^ 

On  the  other  hand,  at  about  the  same  time  the  Court  of 
King's  Bench,  in  Adams  v.  Lindsell,^  where  the  defendants 
offered,  by  letter,  to  sell  the  plaintiff  a  lot  of  wool  upon  cer- 
tain terms,  requesting  an  answer  by  due  course  of  mail,  to 
which  letter  the  plaintiff,  as  soon  as  he  received  it,  replied, 
accepting  the  offer,  held  that  the  contract  was  complete 
when  the  plaintiff  mailed  the  letter  accepting  the  offer,  as 
otherwise  no  contract  could  ever  be  completed  by  the  post.^ 

§  47.  Contract  by  Letter  (continued).  — The  same  question 
has  been  before  the  Court  of  Errors  of  New  York,*  the 
Supreme  Court  of  Pennsylvania,^  and  the  Supreme  Court  of 
the  United  States.^  In  the  first  of  these  cases,  the  letter  of 
acceptance,  after  much  correspondence,  was  mailed  before 

1  McCulloch  V.  Eagle  Ins.  Co.,  1  Pick.  (Ma.ss.)  270.  The  court  cited  Cooke 
V.  Oxley,  3  D.  &  E.  653,  which  was  a  case  where  the  defendant  offered  to  sell 
tohacco  to  the  plaintiff  upon  certain  terms,  and  at  the  plaintiffs  request  gave 
him  till  a  certain  time  to  accept  or  reject,  before  the  arrival  of  which  time  notice 
of  acceptance  was  given,  and  the  court  held  that  there  was  no  contract  ;  and 
Payne  v.  Cave,  3  D.  &  E.  148,  which  was  a  case  where  the  court  held  that  a 
bidder  at  an  auction  had  a  right  to  withdraw  his  bid  at  any  time  before  the 
hammer  was  down  ;  that  is,  at  any  time  before  the  acceptance  of  the  bid.  The 
doctrine  of  this  last  case  is  fully  sustained  by  Pothier,  Traite  du  Contrat  de 
Vente,  p.  1,  §  2,  art.  3,  no.  32. 

2  1  Barn.  &  Aid.  681. 

3  The  cases  of  Payne  v.  Cave  and  Cooke  v.  Oxley,  ubi  supra,  were  cited  in 
this  case  by  the  defendants'  counsel,  but  the  court  did  not  regard  them  as 
authoritative.  During  the  delay  which  intervened  between  the  forwarding  of 
the  offer,  which  by  misdirection  did  not  reach  the  plaintiff  in  the  usual  season, 
the  defendants  had  sold  the  wool  to  another  purchaser. 

*  Mactier  v.  Frith,  6  Wend.  (N.  Y.)  103. 
6  Hamilton  v.  Lycoming  Mut.  Ins.  Co.,  5  Barr  (Pa.),  339. 
6  Tayloe  v.  Merchants'  Fire  Ins.  Co.,  9  How.  (U.  S.)  390. 
80 


CH.  IV.]  CONSUMMATION    OF   THE    CONTRACT.  [§  47 

the  death  of  the  party  to  whom  it  was  addressed,  but  did 
not  arrive  at  its  destination  till  after  the  death;  and  the 
court  approved  and  adopted  the  doctrine  of  the  English  case, 
as  well  upon  the  reason  of  the  thing,  as  upon  the  apparent 
approval  of  the  same  by  the  Court  of  Common  Pleas,  in 
Routledge  v.  Grant.  ^  —  The  case  in  Pennsylvania  was  a 
little  more  complex  in  its  facts,  which  were  substantially  as 
follows:  The  plaintiff  applied  to  the  agent  of  an  insurance 
company  by  written  application  for  insurance  upon  an  acad- 
emy building,  agreed  upon  the  terms,  and  paid  the  pre- 
mium, and  received  a  certificate  from  the  agent  that  the 
property  would  be  insured  from  the  date  of  the  application, 
if  the  company  approved.  On  transmitting  the  papers  to 
the  company,  without  approving  the  application  they  wrote 
to  the  agent  that  the  plaintiff  must  make  certain  changes ; 
and  when  the  company  were  duly  certified  that  these  requi- 
sites were  complied  with  a  policy  would  be  sent.  These 
requisites  were  complied  with,  and  the  agent  duly  notified 
thereof,  and  requested  to  call  and  examine  for  himself; 
which  however  he,  from  press  of  business,  neglected  to  do 
until  the  building  insured  was  burned.  On  a  refusal  by  the 
company  to  pay  the  loss  on  the  ground  that  no  contract  had 
been  perfected,  the  court,  adopting  the  principle  of  the 
English  case,  held  that  the  contract  was  completed  by  notice 
given  to  the  agent  of  his  compliance  with  the  requisitions 
of  the  company.  He  had  performed  that  in  consideration  of 
which  a  policy  had  been  promised,  and  he  was  therefore  en- 
titled to  his  policy.  In  the  case  in  the  Supreme  Court  of 
the  United  States,  the  facts  were  that  the  plaintiff  applied 
for  insurance  to  the  company's  agent,  who,  after  communi- 
cation with  his  principal,  wrote  the  plaintiff  stating  the 
terras,  and  added,  that  if  he  wished  to  insure  he  could  send 
his  check  for  the  premium,  "  and  the  business  is  concluded. " 
This  letter  was  delayed  by  misdirection;  but  as  soon  as  re- 
ceived and  before  any  loss,  the  plaintiff  replied,  accepting 
the  terms,  and  enclosing  his  check.  The  letter  of  accep- 
tance, however,  did  not  reach  the  agent  till  the  property  in- 

1  4  Bing.  653. 
VOL.  I. —6  81 


§  48]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  IV. 

sured  had  been  destroyed.  In  this  case  also  it  was  claimed 
by  the  insurers  that  no  contract  had  been  completed.  But 
the  court  held  that  the  contract  was  complete  by  the  accep- 
tance transmitted  in  due  course  of  mail.^ 

§  48.  And  the  doctrine  of  this  latter  case  must  now  be 
considered  as  the  one  which  is  supported  by  the  great  pre- 
ponderance of  authority,  and  as  recommended,  if  not  by  the 
better  reason,  at  least  by  its  greater  practicability,  —  a  con- 
sideration which  seems  to  have  had  controlling  influence  in 
leading  to  its  adoption.^ 

1  "  If  the  contract,"  say  the  court,  "  became  complete,  as  we  think  it  did,  on 
the  acceptance  of  the  offer  b)'  the  applicant,  on  the  21st  December,  1844,  the 
company,  of  course,  could  have  no  knowleilge  of  it  until  the  letter  of  acceptance 
reached  the  agent,  on  the  31st  of  the  month  ;  and,  on  the  other  hand,  upon  the 
hypothesis  it  was  not  complete  until  notice  of  the  acceptance,  and  then  became  so, 
the  applicant  could  have  no  knowledge  of  it  at  the  time  it  took  effect.  In  either 
aspect,  and,  indeed,  in  any  aspect  in  which  the  case  can  be  presented,  one  of  the 
parties  must  be  unadvised  of  the  time  when  the  contract  takes  effect,  as  its  con- 
summation must  depend  upon  the  act  of  one  of  them  in  the  absence  of  the  other. 

"The  negotiation  being  carried  on  through  the  mail,  the  offer  and  acceptance 
cannot  occur  at  the  same  moment  of  time  ;  nor,  for  the  same  reason,  can  the 
meeting  of  the  minds  of  the  parties  on  the  subject  be  known  by  each  at  the 
moment  of  concurrence  ;  the  acceptance  must  succeed  the  offer  after  the  lapse  of 
some  interval  of  time  ;  and,  if  the  process  is  to  be  carried  farther  in  order  to  com- 
plete the  bargain,  and  notice  of  the  acceptance  must  be  received,  the  only  effect  is 
to  reverse  the  position  of  the  parties,  changing  the  knowledge  of  the  completion 
from  the  one  party  to  the  otiier. 

"  It  is  obviously  impossible,  therefore,  under  the  circumstances  stated,  ever  to 
perfect  a  contract  by  correspondence,  if  a  knowledge  of  both  parties  at  the  mo- 
ment they  became  bound  is  an  essential  element  in  making  out  the  obligation. 
And  as  it  must  take  effect,  if  effect  is  given  at  all  to  an  endeavor  to  enter  into  a 
contract  by  correspondence,  in  the  absence  of  the  knowledge  of  one  of  the  parties 
at  the  time  of  its  consummation,  it  seems  to  us  more  consistent  with  the  acts  and 
declarations  of  the  parties  to  consider  it  complete  on  the  transmission  of  the 
acceptance  of  the  offer  in  the  way  they  themselves  contemplated,  instead  of 
postponing  its  completion  till  notice  of  such  acceptance  has  been  received  and 
assented  to  by  the  company. 

"For  why  make  the  offer,  unless  intended  that  an  assent  to  its  terms  should 
hind  them?  And  why  require  any  further  assent  on  their  part,  after  an  uncondi- 
tional acceptance  by  the  party  to  whom  it  is  addressed  ?" 

2  Palm  V.  Medina  Ins.  Co.,  20  Ohio,  529,  and  cases  cited,  post,  §  49  ;  Eames  v. 
Home  Ins.  Co.,  94  U.  S.  621.  [A  contract  is  accepted  when  the  letter  declaring 
its  acceptance  is  posted.  Punlop  v.  Higgins,  1  H.  L.  Cas.  381,  399  ;  Potter  v. 
Sanders,  6  Hare,  1,  9.  And  this  is  so  although  the  letter  declares  in  effect 
that  the  writer  will  not  be  bound  until  he  receives  an  answer  from  the  other  party, 
with  a  duplicate  of  the  contract  executed  by  him.  Vassar  v.  Camp,  14  Barb. 
(N.  Y. )  341,  355.  The  letter  must,  however,  be  properly  started,  and  must, 
among  other  things,  be  stamped.     Blake  v.  Ins.  Co.,  67  Tex.  160.] 

82 


CH.  IV.]       CONSUMMATION  OF  THE  CONTKACT.         [§  50 

And,  indeed,  it  may  be  inferred  from  what  fell  from  the 
court  in  a  later  case,i  that  even  in  Massachusetts,  it  is  by 
no  means  certain  that  the  case  of  McCuUoch  v.  Eagle  In- 
surance Company  would  now  be  followed  except  in  a  case 
exactly  coinciding  with  it  in  its  facts,  the  court  there  ob- 
serving that  it  may  well  be  conceded  that  when  notice  of 
acceptance  is  to  be  given  by  mail  a  notice  actually  put  into 
the  mail,  especially  if  forwarded,  and  beyond  the  control  or 
revocation  of  the  party  making  it,  may  be  good  notice. 

§  49.  Acceptance.  —  An  offer  of  insurance  by  mail  is, 
therefore,  a  continuing  offer,  and  becomes  binding  upon 
acceptance,  before  notice  of  withdrawal,  in  due  course  of 
mail;  and  the  unqualified  acceptance  by  one  party  of  the 
terms  proposed  by  the  other,  transmitted  by  due  course  of 
mail,  is  to  be  regarded  as  closing  the  bargain  from  the  time 
of  the  transmission  of  the  acceptance.  The  concurrence  of 
knowledge  in  point  of  time  with  the  act  of  completion  is 
wholly  impracticable  in  contracts  by  correspondence,  since 
the  consummation  must  depend  upon  the  act  of  one  party  in 
the  absence  of  the  other.  ^ 

But  the  acceptance  must  be  within  reasonable  time.  And 
where  a  reply  would  naturally  be  expected  by  the  next  return 
mail  after  the  receipt  of  the  offer,  a  delay  covering  the  de- 
parture of  one  or  more  mails  would  seem  to  be  unreasonable, 
and  the  party  making  the  offer  would  have  a  right  to  pre- 
sume that  the  offer  was  rejected.  ^ 

§  50.  No  Contract  unless  all  the  Terms  are  agreed  upon.  — 
But  it  is  to  be  carefully  noted  that,  unless  the  parties  have 
come  to  an  agreement  upon  all  the  terms  of  the  contract,  so 

1  Thayer  v.  Middlesex  Mut.  Fire  Ins.  Co.,  10  Pick.  (Mass.)  326,  332.  In 
British  and  Am.  Tel.  Co.  v.  Colson,  L.  R.  6  Ex.  108,  it  was  held  that  if  the  ac- 
ceptance was  never  received  there  was  no  contract.  But  this  is  hardly  con- 
sistent with  still  later  authorities.  See  Harris's  Case,  /71  re  Imperial  Land  Co., 
L.  R.  7  Ch.  587.     See  also  2  Kent,  Com.  *477,  12th  ed.  ;  5  Alb.  L.  J.  272. 

2  Western  v.  Genessee  Mut.  Ins.  Co.,  2  Kernan  (N.  Y.),  258 ;  Hallock  v.  Com. 
Ins.  Co.,  2  Dutch.  (IST.  J.)  268  ;  s.  c.  affirmed,  3  id.  645  ;  Duncan  v.  Topham, 
8  C.  B.  225.  In  the  last  case  the  letter  of  acceptance  never  reached  its 
destination. 

3  Thayer  v.  Middlesex  Mut.  Fire  Ins.  Co.,  10  Pick.  (Mass.)  326.  See  also 
Insurance  Co.  v.  Johnson,  23  Pa.  St.  72  ;  post,  §§  53,  56. 

83 


§51]  insurance:   fire,  life,  accident,  etc.       [ch.  IV. 

that  so  far  as  the  terms  are  concerned  nothing  remains  open, 
and  nothing  remains  to  be  done  but  to  execute  what  has  been 
ao-rced  upon,  the  contract  is  still  incomplete,  and  of  no  bind- 
ing force  upon  either  party,  even  though  the  secretary  of  the 
company  inform  the  applicant  that  he'  may  "  hold  himself 
insured,"^  or  part  of  the  premium  be  accepted. ^  An  offer 
by  one  party  imposes  no  obligation  upon  another  until  ac- 
cepted by  him  according  to  the  terras  in  which  the  offer  is 
made.  The  offer  must  be  accepted  as  it  is.  If  not,  and  any 
qualification  of  or  departure  from  its  terms  is  made,  it  must 
be  referred  back  to  the  party  making  the  original  offer  for 
his  acceptance  of  the  qualification  before  he  can  be  bound. ^ 
Hence,  when  the  defendant  offered  to  purchase  flour  at  a 
certain  price,  and  required  the  answer  to  be  sent  to  a  cer- 
tain place,  an  answer  accepting  the  offer,  but  addressed  to 
the  defendant  at  another  place  than  that  by  him  designated, 
was  held  not  to  be  an  acceptance  which  would  bind  the  de- 
fendant, although  the  defendant  received  it.  The  terms  of 
the  offer  had  not  been  complied  with."* 

§  51.  And  to  the  same  effect  is  the  following  case :  On 
the  18th  day  of  the  month  the  plaintiff  wrote  to  the  defend- 
ant that  he  would  sell  him  oil-cake  at  a  certain  price.  On 
the  19th  the  defendant  replied  that  he  would  take  a  certain 
amount,  "but  it  must  be  put  on  board  directly."  On  the  22d 
of  the  same  month  the  plaintiff  replied,  "I  shall  ship  to- 
morrow." This  last  letter  never  reached  the  applicant. 
Upon  the  facts,  the  court  held  that  "  directly "  meant,  in 
point  of  time,  something  less  than  "within  a  reasonable 
time,"  and  that  an  acceptance  which  might  have  been  made 
on  the  20th,  made  and  posted  on  the  22d,  coupled  with  a 
day's  further  delay  in  shipping,  was  not  an  acceptance 
according  to  the  terms  of  the  defendant's  offer.^     So  where 

1  Christie  v.  North  British  Ins.  Co.,  3  Ct.  of  Sess.  Cas.  (Scotch)  519. 

2  Piedmont,  &c.  Life  Ins.  Co.  v.  Ewing,  92  U.  S.  377  ;  Patterson  v.  Ben 
Franklin  Ins.  Co.  (Pa.),  5  Ins.  L.  J.  376,  377. 

8  Chase  v.  Hamilton  Mut.  Ins.  Co.,  22  Barb.  (N.  Y.)  527  ;  Mut.  Life  Ins.  Co. 
V.  Young,  23  Wall.  (TJ.  S.)  85-106. 

*  Eliason  v.  Henshaw,  4  AVheat.  (U.  S.)  225,  228 ;  post,  §  54. 
6  Duncan  v.  Topham,  8  C.  B.  225. 
84 


CH.  IV.]  CONSUMMATION   OF   THE   CONTKACT.  [§  52 

a  proposal  was  made  for  insurance,  in  which  the  rate  of  pre- 
mium was  not  fixed,  and  the  company  transmitted  to  their 
agent  a  letter  accepting  the  proposal,  and  stating  that  a  pol- 
icy would  be  issued  on  the  payment  of  a  certain  premium, 
which  letter,  however,  owing  to  an  unfavorable  change  in 
the  health  of  the  applicant,  the  agent  did  not  make  known 
to  him,  it  was  held  that  the  terms  of  the  contract  were  never 
agreed  upon,  the  rate  of  premium  not  having  been  stated 
and  accepted.^  So,  if  no  time  is  agreed  upon.'^  The  time, 
however,  will  be  inferred  from  slight  circumstances.^  So, 
where  there  is  a  misapprehension  as  to  the  property  insured,^ 
or  as  to  the  paper  referred  to  as  containing  the  description 
of  the  property.^ 

So,  where  the  insured  agrees  to  take  the  policy  at  any  rate 
of  premium  fixed  by  the  company,  and  the  agent  forwards 
the  application  and  fixes  the  rate  of  premium  which  he 
thinks  the  principal  should  accept;  but  the  principal,  op- 
posing the  application,  fixes  a  larger  rate,  with  the  right  of 
the  applicant  to  decline,  and  forwards  the  policy  to  the 
agent,  which,  through  his  neglect,  is  lost,  and  not  brought 
to  the  notice  of  the  applicant  till  after  a  loss,  the  contract 
was  held  incomplete,  as  the  parties  had  come  to  no  under- 
standing as  to  the  rate  of  premium.^  So  if  the  insured  keeps 
the  matter  open  to  see  if  the  policy  is  in  accordance  with  the 
agreement,  where  premium  was  to  be  paid  or  policy  returned.' 

§  52.  So,  where  an  action  was  brought  for  the  recovery  of 
a  premium  note  given  by  the  defendant,  on  a  policy  executed 
by  the  company,  and  the  question  was,  whether  the  policy 
corresponded  with  the  previous  agreement,  so  that  the  de- 
fendant was  bound  to  accept  it.     It  appeared  that  Carring- 

1  Wemyss  v.  Med.  Ins.  &  Gen.  Life  Ins.  Soc,  11  Ct.  of  Sess.  Cas.  (Scotch) 
2ii  series,  151,  345  ;  s.  c.  20  Scotch  Jur.  534  ;  Piedmont,  &c.  Ins.  Co.  v.  Ewing, 
92  U.  S.  377  ;  Christie  v.  North  British  Ins.  Co.,  3  Ct.  of  Sess.  Cas.  (Scotch) 
519.     See  also  Neville  v.  Mer.  &  Manuf.  Ins.  Co.,  19  Ohio,  ^52  ;  post,  §§56,  57. 

2  Strohn  v.  Hartford  Fire  Ins,  Co.,  37  Wis.  625. 

3  Eames  v.  Home  Ins.  Co.,  94  U.  S.  621. 

*  Cxoddard  v.  Monitor  Mut.  Fire  Ins.  Co.,  108  Mass.  56,  57. 

5  Le  Roy  v.  Market  Fire  Ins.  Co.,  45  N.  Y.  80. 

6  Wallingford  v.  Home  Mut.  Fire  &  Mar.  Ins.  Co.,  30  Mo.  46, 
^  Eogers  v.  Charter  Oak  Life  Ins.  Co.,  41  Cona.  97. 

85 


§  52]  INSURANCE  :    FIKE,   LIFE,   ACCIDENT,   ETC.  [CH.  IV, 

ton  wrote  to  the  company  to  inquire  upon  what  terms  they 
would  make  an  insurance  "on  twenty-six  horses  and  twenty 
oxen,  on  board  the  "brig  'Gleaner,'  from  Saybrook  to  the 
West  Indies,"  saying  nothing  as  to  the  valuation  of  the 
property,  or  the  sum  he  desired  to  be  insured.  The  com- 
pany replied  in  these  words:  "The  office  will  take  the  risk 
at  fifteen  per  cent,  or  at  ten  per  cent  with  a  warranty  that 
the  property  was  safe  on  the  7th  of  December  last,  but  no 
partial  loss  is  to  be  paid  under  ten  per  cent."  By  the  mail 
of  the  next  day  Carrington  replied,  "  We  accept  your  terms 
with  a  policy  filled,  on  twenty-six  horses  valued  at  $2,200, 
and  on  twenty  oxen,  valued  at  $800,"  and  in  this  letter 
enclosed  the  premium  note.  The  company,  on  the  following 
day,  forwarded  by  mail  a  policy  "for  $3,000  on  stock,  on 
the  deck  of  the  brig  'Gleaner,'  "  with  this  note  in  the  mar- 
gin, "Forty-six  head  of  horses  and  oxen,  valued  at  $3,000." 
This  policy  the  defendant  refused  to  accept,  and  immediately 
returned  it  to  the  company.  The  ground  of  this  refusal 
was,  that  the  horses  and  oxen  were  included  in  one  gross 
valuation,  instead  of  being  separately  valued,  according  to 
the  terras  in  which  he  had  accepted  the  offer.  In  delivering 
the  judgment  of  the  com-t,  and  commenting  on  the  defend- 
ant's second  letter,  Chief  Justice  Hosmer  said:  "This  was 
a  new  proposal,  which  Carrington  might  presume  the  com- 
pany would  accept,  but  could  not  know  it.  The  office  had 
assumed  no  such  obligation,  as  the  office  had  not  agreed  to 
underwrite  a  valued  policy ;  neither  had  the  defendant  agreed 
to  receive  an  open  policy.  The  minds  of  the  parties  had  not 
met.  It  would  be  plainly  an  unjustifiable  stress  upon  the 
first  words  of  the  letter  'we  accept,'  to  consider  this  expres- 
sion as  concluding  the  contract.  The  underwriters,  by  the 
valued  policy  which  they  transmitted,  recognized  the  new 
proposal  in  part,  and  if  they  had  attended  to  their  import, 
the  same  words  would  have  convinced  them  that  a  separate 
valuation  of  the  horses  and  oxen  was  proposed.  The  policy 
transmitted  was  not  conformable  to  the  proposition.  The 
parties  never  did  agree.  "^ 

1  Ocean  Ins.  Co.  v.  Carrington,  3  Conn.  357. 

86 


GH.  IV.]       CONSUMMATION  OF  THE  CONTRACT.  [§  53 

§  53.  Acceptance.  —  Where  the  proposition  is  by  letter, 
the  usual  mode  of  acceptance  is  by  letter  announcing  the 
acceptance.  When  it  is  made  by  a  messenger,  a  determina- 
tion to  accept  returned  through  him,  or  by  another,  would 
seem  to  be  all  the  law  requires.  But  there  are  other  modes 
of  acceptance  equally  conclusive  upon  the  parties.  Any- 
thing that  amounts  to  a  manifestation  of  a  formal  determin- 
ation to  accept,  communicated,  or  put  in  the  proper  way  to 
be  communicated,  to  the  party  making  the  oifer,  would 
doubtless  complete  the  contract.  An  acceptance  is  the  dis- 
tinct act  of  one  party  to  the  contract,  as  much  as  the  offer 
is  of  the  other.  What  will  constitute  an  acceptance  depends 
in  a  great  measure  upon  the  circumstances  of  the  case.  It 
seems  that  the  charging  up  to  himself  in  his  monthly 
account,  by  an  agent,  of  the  premium  fixed  by  his  principals, 
in  a  policy  sent  by  them  to  him  on  his  own  property,  would 
be  a  sufficient  acceptance,  as  nothing  more  would  naturally 
be  contemplated.^  But  a  mere  mental  assent,  not  indicated 
by  any  outward  expression,  has  nowhere  been  held  to  be 
sufficient.  Nor  is  mere  silence  or  neglect  to  respond  suffi- 
cient, even  M'hen  the  applicant,  having  done  all  that  is  re- 
quired of  him,  is  to  receive  his  policy  if  the  directors 
approve,  or  a  return  of  the  premium  paid  -if  they  do  not. 
And  this  is  so  although  neither  the  money  is  refunded  nor 
a  reply  made  within  six  months.'-^  And  a  letter  of  accep- 
tance written,  but  still  in  the  possession  of  the  writer,  or 
under  his  control,  would  not  probably  be  regarded  as  any- 
thing more  than  a  mere  mental  assent.  The  unpublished  or 
undelivered  letter  would  perhaps  be  considered  as  but  little 
better  as  matter  of  evidence  than  the  unspoken  intent. 
What  seems  to  be  necessary  is,  that  the  acceptance  should 
be  manifested  by  some  act  which  is  open  to  the  observation 
of  others,  and  of  such  a  character  as  natuially  to  give  rise 
to  the  presumption  of  acceptance,  in  contradistinction  to  an 
equivocal  act,  which  might,  or  might  not,  be  connected  with 

^  Lungstrass  v.  German  Ins.  Co.,  48  Mo.  201. 

2  New  York  Union  Mut.  Ins.  Co.  v.  Johnson,  23  Pa.  St.  72 ;  Myers  v.  Key- 
stone Mut.  Life  Ins.  Co.,  27  id.  268.     See  alsojoos^,  §§54,  58. 

87 


§  53]  INSUEANCE:    fire,   life,   accident,   etc.  [cH.  IV 

an  acceptance,  but  would  not  naturally  suggest  it.  The 
observation  of  the  late  Mr.  Chief  Justice  Gibson  in  Hamil- 
ton V.  Lycoming  Mutual  Insurance  Company,^  that  an  actual 
concurrence  of  assent  at  any  particular  moment  is  the  ruling 
circumstance,  must  be  taken  with  the  qualification  that  the 
assent,  though  not  brought  to  the  knowledge  of  the  other 
party,  must  have  taken  some  outward  form  of  expression. 
Nothing  further  than  this  was  called  for  by  the  case.  The 
meeting  of  two  minds,  the  aggregatio  me7itium  necessary  to 
the  constitution  of  every  contract,  must  take  place  eo  in- 
stanti  with  the  doing  of  any  overt  act  intended  to  signify  to 
the  other  party  the  acceptance  of  the  proposition,  without 
regard  to  when  that  act  comes  to  the  knowledge  of  the  other 
party.  The  overt  act  may  vary  with  the  form  and  nature  of 
the  contract.  It  may  be  by  the  fall  of  the  hammer,  by  words 
spoken,  by  letter,  by  telegraph,  by  remitting  the  article  sent 
for,  by  mutual  signing,  or  by  delivery  of  papers;  and  the 
delivery  may  be  by  any  act  intended  to  signify  that  the  in- 
strument shall  have  a  present  vitality.  Whatever  the  form, 
the  act  done  is  the  irrevocable  evidence  of  the  aggregatio 
mentium;  and  at  that  instant  the  bargain  is  struck.  The 
acceptor  can  no  more  overtake  and  countermand  by  telegraph 
his  letter  mailed,  than  he  can  his  words  of  acceptance 
after  they  have  issued  from  his  lips  on  their  way  to  the 
hearer.^ 

[A  provision  in  a  policy  that  the  agent  has  no  power  to 
modify  the  contract,  refers  to  the  policies  after  they  have 
become  executed  between  the  parties;  and  where  A.  took 
out  a  life  policy,  giving  his  note  for  the  premium,  on  con- 
dition that  if  a  satisfactory  surrender  of  other  policies  could 
not  be  effected  A.  could  return  the  last  policy  to  the  agent 
and  demand  his  note,  it  was  held  that,  as  there  was  only  a 
conditional  acceptance  of  the  policy  by  A.,  and  not  an  abso- 
lute one,  he  could  demand  his  note  on  the  non-fulfilment  of 
the  condition.  Even  if  the  agent  had  no  right  to  make  a 
conditional  delivery,  still  the  full  acceptance  necessary  to  a 

1  5  Barr  (Pa.),  339. 

2  Hallock  V.  Com.  Ins.  Co.,  2  Dutch.  (N.  J.)  268  ;  s.  c.  3  id.  645. 


CH.  IV.]  CONSUMMATION    OF   THE   CONTRACT.  [§  54 

complete  contract  was  lacking.  ^  There  was  an  open  policy 
on  goods,  "  lost  or  not,  on  board  of  any  steamer,  at  and  from 
New  York  to  New  Orleans,  all  sums  placed  at  risk  under 
this  policy  to  be  indorsed  thereon."  The  assured  shipped 
goods,  but  before  he  could,  acting  with  reasonable  diligence, 
inform  the  company,  the  goods  were  lost,  and  the  company 
refused  to  indorse  the  amount.  It  was  held,  however,  that 
the  company  was  liable ;  the  indorsement  was  not  necessary 
to  create  liability,  but  was  a  form  which  the  company  could 
not  refuse  when  the  insured  acted  in  good  faith  and  with 
proper  diligence.^ 

§  54.  Agreement  with  Agent  subject  to  Approval  of  Prin- 
cipal. —  If  an  agent  agrees  with  the  applicant  upon  the  terms 
of  insurance  subject  to  the  approval  of  his  principal,  and  his 
principal  returns  a  policy  containing  a  modification  of  the 
terms,  which  the  agent  forwards  to  the  applicant,  with  a 
request  that  he  will  return  it  if  he  does  not  comply  with  the 
terms,  and  the  applicant  neither  returns  the  policy  nor  com- 
plies with  the  modified  terms,  —  the  payment  of  additional 
cash  premiums,  — the  delivery  is  only  conditional,  and  the 
contract  is  not  complete  till  the  compliance  with  the  new 
terms.  ^  So,  where  all  the  terms  are  agreed  upon,  and  the 
assured  is  told  that  he  may  regard  himself  as  insured,  but 
pending  the  issue  of  the  policy  the  assured  notifies  the  in- 
surers that  he  desires  a  change,  the  particulars  of  which  he 
does  not  state,  and  neglects  to  attend  to  the  modification, 
though  requested,  and  notified  by  the  insurers  that  unless 
he  call  and  make  known  the  desired  change  they  will  not  be 
held  responsible,  the  contract  is  still  incomplete.^  And  the 
plaintiff  will  be  in  no  better  position  if  he  inquire  for  his 
policy,  and  being  told  by  the  agent  that  he  could  not  tell 
whether  he  had  received  it  or  not,  but  thought  he  delivered 
it  to  the  plaintiff,  neglects  further  inquiry.     He  must  accept 

1  [Harnickell  v.  N.  Y.  L.  Ins.  Co.,  Ill  N.  Y.  390] 

2  [Carver  Co.  v.  Mauf's  Ins.  Co.,  6  Gray  (Mass.),  214,  219.] 

3  Myers  v.  Keystone  Mat.  Life  Ins.  Co.,  27  Pa.  St.  268 ;  Mut.  Life  Ins.  Co. 
V.  Young,  23  Wall.  (U.  S.)  85,  106. 

4  Sandford  v.  Trust  Fire  Ins.  Co.,  11  Paige  (N.  Y.  Ch.),  547;  ante,  §50. 

89 


§  54  B]  INSURANCE  :    FIRE,    LIFE,   ACCIDENT,    ETC.  [CH.  IV 

the  contract  as  modified,  or  there  is  no  contract,   and  the 
negligence  of  the  agent  will  not  excuse  his  non-acceptance. i 

[§  54  A.  Contract  subject  to  Approval.  —  Where  an  appli- 
cation provides  that  a  policy  is  to  take  effect  on  the  day  the 
api)lication  is  approved,  and  it  is  never  approved,  there  is 
no  contract.2  ^^  application  and  premium  sent  to  the  com- 
pany on  approval  but  never  received  by  it,  nothing  more 
being  done,  constitute  no  contract. ^  "Approval"  means 
approval  by  the  home  office.  If  an  application  is  sent  on 
approval,  a  lapse  of  eighteen  days  without  word  from  the 
company  will  not  authorize  the  conclusion  that  the  risk  is 
accepted.*  Where  a  policy  is  given  by  the  agent  to  a  third 
party  until  he  could  learn  if  the  company  would  accept  the 
risk,  there  is  no  delivery  or  consummation  of  contract.^ 
Where  an  agent  agreed  to  write  a  policy  to  take  effect  at  a 
given  time,  but  remarked  that  he  did  not  know  whether  his 
company  would  carry  the  risk  after  he  had  written  and  re- 
ported it  to  them,  and  he  never  wrote  or  reported  it,  the 
company  was  held  to  pay  for  a  loss.  It  was  the  agent's  duty 
to  have  reported  the  risk,  and  the  agreement  would  have 
held  until  notice  from  the  company  to  cancel  it.  Such  being 
the  law,  the  neglect  of  the  agent  to  write  the  policy  cannot 
make  the  company's  liability  any  less  than  it  would  have 
been  if  the  agent  had  done  his  duty.^J 

[§54  B.  When  the  Company  must  give  Notice  of  Disap- 
proval. —  Where  the  insured  receives  a  "  binding-slip "  or 
memorandum  that  a  policy  will  be  issued  to  him,  the  com- 
pany if  it  concludes  not  to  write  the  risk  must  give  reason- 
able notice,  and  a  notice  at  noon  of  the  day  on  which  a  fire 
occurs  at  three  o'clock  is  not  reasonable,  as  sufficient  time 
had  not  elapsed  in  which  to  obtain  new  insurance.'     If  a 

1  Wallingford  v.  Home  Mut.  Fire  Ins.  Co.,  30  Mo.  46. 

2  [Winnesheik  Ins.  Co.  v.  Holzgrafe,  53  111.    516  ;  Pickett  v.  Insurance  Co., 
39  Kans.  697.1 

3  [Atkinson  v.  Hawkeye  Ins.  Co.,  71  la.  340.] 

*  [Winnesheik  Ins.  Co.  v.  Holzgrafe,  53  111.  516.] 

5  [Brown  v.  Amer.  Central  Ins.  Co.,  70  la.  390.] 

6  [Campbell  v.  Amer.  F.  Ins.  Co.,  73  Wis.  100,  107.] 
">  [Lipman  v.  Niagara  F.  Ins.  Co.,  48  Hun,  503.] 

90 


CH.  IV.]  CONSUMMATION    OF   THE    CONTKACT.  [§  55 

policy  is  negotiated  through  several  parties,  and  is  delivered 
to  B.  by  the  insurance  agent  conditionally,  that  is,  subject 
to  approval  of  the  company,  and  B.  delivers  to  C.  and  C.  to 
the  insured  without  naming  any  condition,  and  the  premises 
burn  before  actual  notice  to  the  insured  that  the  company 
disapproves  and  cancels  the  policy,  the  company  is  liable  for 
the  loss.^] 

[§  54  C.  Application  once  approved  cannot  he  rejected  hy 
Company  because  of  Loss  before  Policy.  —  If  an  application 
sent  on  approval  is  actually  accepted  by  the  company,  at  its 
home  office,  though  no  notice  of  acceptance  is  given  to  the 
insured,  and  afterward  rejected  only  because  the  premises 
burned  before  a  policy  was  made  out,  the  company  is  bound, 
and  this  question  of  fact  is  for  the  jury.^] 

§  55.  Agreement  with  Agent ;  Payment  of  Premium.  —  And 
although  the  policy  be  made  out  and  forwarded  to  the  agent 
to  be  delivered  to  the  applicant  on  payment  of  the  premium, 
the  applicant,  by  an  understanding  with  the  agent,  having 
still  the  option  to  take  or  reject  the  policy,  as  it  still  re- 
mains for  the  applicant  to  declare  his  option  and  pay  the 
premium,  he  will  not  be  entitled  to  a  delivery  thereof  until 
such  a  payment.  And  if,  on  being  called  upon  by  the  agent 
and  tendered  the  policy  on  payment  of  the  premium,  he  re- 
fers him  to  a  third  person,  who,  he  says,  will  pay  the  pre- 
mium, and  the  agent  agrees  to  call  upon  that  person,  this  is 
not  the  equivalent  of  payment.  Perhaps  it  would  be  other- 
wise if  the  third  person  had  agreed  to  pay  the  premium.  ^ 
Such  a  case  is  to  be  distinguished  from  those  where  the 
party  claiming  the  policy  has  done  everything  which  is  re- 
quired of  him.  There  the  policy  is  held  merely  as  a  deposit, 
and  for  delivery;  while  here  it  is  held  for  payment  of  the 
premium.  And  if  the  option  be  not  exercised  till  after  loss, 
it  will  then  be  too  late,  as  then  there  is  nothing  to  which 
the  risk  can  attach.*     Payment  by  a  stranger  without  the 

1  [Hodge  V.  Security  Ins.  Co.,  33  Hun,  583.] 

2  [Welsh  V.  Continental  Ins.  Co.,  47  Hun,  598.] 

3  Hoyt  V.  Mutual  Benefit  Life  Ins.  Co.,  98  Mass.  539. 
*  Bradley  v.  Potomac  Fire  Ins.  Co.,  32  Md.  108. 

91 


§  55  A]  INSUKANCE  :    FIKE,   LIFE,   ACCIDENT,  ETC.  [CH.  IV. 

knowledge  of  the  applicant  binds  neither  the  applicant  nor 
the  insurer.  1  But  if  the  policy  be  held  merely  for  delivery 
on  payment  of  the  premium,  the  agent  has  no  right  to  refuse 
to  deliver  on  tender  of  the  premium,  unless  his  authority  is 
limited  to  delivery  to  applicants  still  in  good  health,  al- 
though the  applicant  be  dangerously  ill  at  the  time  of  the 
tender  of  the  premium. ^  So  where  a  wife  applied  to  an 
agent  for  a  policy  on  the  life  of  her  husband,  and,  in  accord- 
ance with  the  company's  rules,  paid  fifty  dollars,  which  was 
to  be  applied  to  the  first  year's  premium  if  the  risk  was 
taken,  and  a  policy  was  made  out  and  sent  to  the  agent  for 
delivery  but  not  delivered,  it  was  held  that  a  tender  of  the 
balance  of  the  first  year's  premium  after  the  death  of  the 
insured  gave  a  valid  claim  upon  the  company  for  the  amount 
insured.^ 

[§  55  A.  Delivery  not  essential  unless  so  Agreed.  —  A  pol- 
icy may  be  binding  although  never  delivered  between  the 
parties.^ (rt)      Everything  depends  on  the  intention  of  the 

1  Whiting  V.  Mass.  Mut.  Life  Ins.  Co.  (Mnss.),  11  Reptr.  13. 

2  Scliwartz  v.  Germania  Life  Ins.  Co.,  18  Minn.  448  ;  s.  c.  21  id.  215. 

8  Cooper  V.  Pacific  Mut.  Life  Ins.  Co.,  7  Nev.  116  ;  Fried  v.  Royal  Ins.  Co.  of 
Liverpool,  47  Barb.  (N.  Y.)  127  ;  s.  c.  50  N.  Y.  243. 
*  [Loring  v.  Proctor,  26  Me.  18,  29.] 

(a)      The     insurer's     imconditional  Co.  of  New  York  v.  Thomson,  94  Ky. 

written   acceptance   of    an    application  253  ;  Machine  Co.  v.  Ins.  Co.,  50  Ohio 

for  life  insurance  consummates  the  con-  St.  549  ;  22    L.   R.  A.   768,  and   note, 

tract,  if  actual  delivery  to  the  insured  There  must,  however,  be  clear  evidence 

is  not  expressly  stipulated  for  ;  and  the  that  the  application  has  been  accepted, 

unconditional  sending  and  delivery  of  and  if  the  applicant  dies  before  such 

the  policy  to  the  insurance  agent,  who  acceptance,   tlie   iiisurer   is   not   liable, 

retains  it,  amounts  to  a  delivery  to  the  Steinle  v.  New  York  Life  Ins.  Co.,  81 

insured,  although  the  policy  purports  Fed.  Rep.  489  ;  Oliver  v.  Mut.  L.  Ins. 

to  make  actual  delivery  to  the  insured  Co.,  97  Va.  134.     A  policy  is  delivered 

essential    to    its   validity.     New  York  when  deposited  in  the  post-office  by  the 

Life  Ins.  Co.  v.  Babcock,  104  Ga.  67  ;  insurer,  directed  to  the  insured  at  his 

Phoenix  Ass.  Co.  y.  McAuthor,  116  Ala.  place  of  residence.     Triple  Link  Mut. 

659.     See  Conn.  Ind.  Ass'n  v.  Grogan  Ind.  Ass'n  v.  Williams  (Ala.),  26   So. 

(Ky.),  28  Ins.  L.  J.  1031 ;   Shackelford  19  ;  Galloway  v.  Standard    F.  Ins.  Co., 

V.  Knights   of    Damon,    98    Ga.    295.  31  S.  E.  969  ;  Hartford  S.  B.  &  Ins.  Co. 

This  is  true  whenever  the  applicant's  v.  Lasher  Stocking  Co.,  66  Vl.  439.     In 

right  to  the  possession  of  the  policy  is  general,  possession  of  the  policy  by  the 

complete,  though  it  may  not  be  actually  insured,  or  by  the  beneficiarv,  isjirima 

delivered  by  the  agent  until  after  the  facie  proof  of  delivery.     Ibid.  ;  Mass. 

death  of  the  insured.    Mutual  Life  Ins.  Benefit  Life  Ass'n   i>.  Siblev,  158   111. 

92 


CH.  IV.]  CONSUMMATION   OF   THE    CONTRACT.  [§  56 

parties.  They  may  agree  that  the  evidence  of  their  contract 
shall  remain  in  the  hands  of  one  or  the  other  party  or  a 
third  person,  as  they  choose.  An  agreement  to  pay  the  pre- 
mium is  a  sufficient  consideration  to  make  an  agreement  to 
insure  valid,  although  the  property  is  destroyed  before  de- 
livery of  the  policy.^  When  a  policy  of  fire  insurance  has 
in  fact  been  executed  and  notice  of  such  execution  been 
given  the  assured,  its  actual  delivery  is  not  essential  to  the 
completion  of  the  contract. 2  Delivery  of  the  policy  may  be 
made  essential  by  a  provision  in  it.^] 

§  56.  Contract  prima  facie  incomplete  if  no  Delivery  and  no 
Payment  of  Premium.  —  If  there  has  been  no  payment  of  the 
premium,  and  no  delivery  in  fact  of  the  policy,  the  contract 
is,  prima  facie,  incomplete,  and  he  who  claims  under  it  must 
show  that  it  was  the  intention  of  the  parties  that  it  should 
be  operative  notwithstanding  these  facts. *     The  presumption 

1  [Filt  V.  Fire  Ins.  Ass.,  20  Fed.  Kep.  766,  2d  Cir.  (Vt.)  1884.] 

2  [Bragdon  v.  Appleton  Mat.  F.  Ins.  Co.,  42  Me.  259,  262  ;  citing  Kahne 
V.  Ins.  Co.  of  N.  A.,  1  Wash.  C.  C.  R.  93.] 

3  [Misselhorn  v.  Mut.  Reserve  Fund  L.  Ass.,  30  Fed.  Rep.  545  (Mo.),  1887  ; 
Kohen  v.  Mut.  Reserve  Fund  L.  Ass.,  28  Fed.  Rep.  705  (Mo.).] 

*  [When  there  is  nothing  to  show  any  transfer  of  the  manual  possession  of 
the  policy,  the  contract  is  prvna  facie  incomplete,  and  the  burden  is  on  him  who 
asserts  it  to  show  that  the  real  intention   and   understanding  was  to  pass  the 

411  ;  Kendrick  v.  Mutual    Benefit   L.  ery  of  a  policy  on   the   promise   of  a 

Ins.   Co.,   124  N.  C.  815.     Where  the  future    payment    of    premium    was    a 

insurance   agent  testified  that  he   had  waiver  of  premium  payment  in  cash,  in 

ordered  the  policy  on  his  own  responsi-  the  absence  of  a  provision  making  such 

bility  and  simply  handed  it  to  the  in-  payment  a  condition  precedent.     Jones 

sured,  telling  him  that,  if  he  accepted  it,  v.  New  York   Life  Ins.  Co.,  168  Mass. 

he  should  sign  his  name  to  it  and  send  245.      The    presumption   is   against   a 

a  check  for  the  premiums,  otherwise  to  completed  contract  when  the  policy  has 

return  it,   and   no    premium   was   ever  not  been  delivered,    and   no   premium 

paid,  and  the  policy  was  found  among  has    been    paid.       Equitable    L.    Ass. 

the  papers  of  the  insured,  it  was  held  Society  v.  McElroy,  83  Fed.  Rep.  631  ; 

that    subsequent     statements     of    the  Modern  Woodmen  Ace.  Ass'n  v.  Ehine, 

agent  to  other  parties  that  he  had  in-  50  Neb.  345  ;   Easley  v.  New  Zealand 

sured  the  deceased  were  admissible  to  Ins.    Co.   (Idaho),   27   Ins.   L.  .T.   289  ; 

contradict  the  agent's  evidence  that  the  Hawley  v.  Michigan    Mut.  L.  Ins.  Co., 

policy  was  never  delivered   to   the   in-  92    Iowa,     593  ;     Dailey    v.    Preferred 

sured  as  a  binding  contract;  that  the  Masonic   Mut.  Ace.   Ass'n,   102   Mich, 

finding  of  the  policy  among  the  papers  289 ;   Weinfeld  v.  Mutual    Reserve   L. 

of  insured  was  evidence  for  the  jury  as  Ass'n,  53  Fed.  Rep.  208. 
to  a  valid  delivery  j  and  that  the  deliv- 

93 


§  56]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  IV. 

of  law  is,  that  the  delivery  of  the  policy  and  the  payment  of 
the  incmium  are  dependent  upon  each  other.  But  this  pre- 
sumption may  be  rebutted  by  showing  a  waiver  of  the  pay- 
ment, or  such  other  facts  as  go  to  show  the  intention  and 
understanding  of  both  parties  that  the  policy  shall  be  valid 
as  if  delivered,  notwithstanding  the  non-payment  of  the  pre- 
mium. ^  An  actual  delivery,  obtained  by  misrepresentation, 
is  no  delivery  to  give  effect  to  the  contract.  The  mere  man- 
ual possession  of  the  policy  is  of  little  consequence,  whether 
it  be  in  the  hands  of  the  insurers  or  the  insured.  Its  pos- 
session by  the  insured  makes  a  prima  facie  case  for  him, 
subject  to  be  met  by  proof  that  it  was  never  delivered  with 
the  consent  of  the  insurers;  while  its  possession  by  the  in- 
surers makes  a  prima  facie  case  for  them,  subject  to  be  met 
by  proof  that,  though  not  transferred,  it  was  intended  by  the 
parties  to  be  a  valid  contract,  without  further  action  by 
either,  and  so  in  legal  contemplation  there  was  a  delivery.^ 

(s)  In  Markey  V.  Mutual  Benefit  Life  Insurance  Company, ^ 
there  had  been  an  actual  manual  possession  of  the  policy  by 
the  assured,  but  under  such  circumstances  that  in  the  opin- 
ion of  the  court  it  was  for  inspection  only,  according  to  the 
intention  and  understanding  of  both  parties,  it  having  been 
returned  to  the  agent,  who,  it  was  understood,  would  call 
upon  a  third  party,  referred  to  by  the  insured,  to  see  if  he 
would  pay  the  premium.  In  Collins  v.  Insurance  Company 
of  Philadelphia,*  the  policy  was  sent  to  the  agent  for  de- 

legal  title  and  possession  of  the  policy,  without,  or  before  the  payment  of  the 
premium,  and  without  delivery  in  fact.  Heiman  v.  Phoenix  Mut.  L.  Ins.  Co., 
17  Minn.  153,  159.] 

1  Faunce  v.  State  Mut.  Life  Assurance  Co.,  101  Mass.  279  ;  Heiman  v.  Phoenix 
Mut.  Life  Ins.  Co.,  17  Minn.  153  ;  Giddings  v.  North  Western  Mut.  Life  Ins.  Co. 
(Sup.  Ct.  U.  S.),  10  Ins.  L.  J.  39  ;  De  Camp  v.  New  Jersey  Mat.  Life  Ins.  Co. 
(C.  Ct.  N.  Y.),  3  Ins.  L.  J.  89  ;  Cooper  v.  Pacific  Mut.  Life  Ins.  Co.,  7  Nev. 
116  ;  Myers  v.  Liverpool,  &c.  Ins.  Co.,  121  Mass.  338  ;  Dinning  v.  Phoenix 
Insurance  Co.,  68  lU.  414,  415  ;  City  Insurance  Co.  v.  Zoller  (Pa.),  4  Ins. 
L.  J.  480;  Berthoud  v.  Atlantic  Fire  Insurance  Co.,  13  La.  539;  post,  §§  134, 
191,  360,  501. 

2  See  also  §45a,  and  cases  there  cited.  Davis  v.  Mass.  Mut.  Life  Ins.  Co., 
13  Blatch.  C.  Ct.  462. 

3  103  Mass.  78. 

4  7  Phila.  Rep.  201.  See  also  Kidder  v.  Travellers'  Ins.  Co.  (N.  Y.  Sup.  Ct.), 
6  Alb.  L.  J.  127. 

94 


Cn.  IV.]  CONSUMMATION   OF   THE   CONTRACT.  [§  5fi 

livery,  on  payment  of  the  premium,  which,  however,  was 
neither  tendered,  though  requested,  before  the  death,  nor 
was  there  any  waiver  of  the  payment.  In  St.  Louis  Mutual 
Life  Insurance  Company  v.  Kennedy, ^  the  applicant  for- 
warded with  his  application  one  note  due  in  one  year  from 
the  date  of  the  application,  and  one  note,  being  for  the 
amount  of  the  cash  premium,  payable  on  the  delivery  of  the 
policy.  It  was  a  mere  memorandum  of  the  cash  premium, 
and  it  was  understood  by  the  parties  that,  while  the  payment 
of  the  premium  in  cash  would  make  the  insurance  take  effect 
from  that  date,  the  promise,  by  this  note,  to  pay  it  when  the 
policy  should  be  delivered,  would  have  the  effect  to  keep  the 
contract  open  until  delivery  on  the  one  hand,  and  the  pay- 
ment of  the  premium  on  the  other.  And  it  was  said  that 
even  if  the  note  was  presumptively  to  be  taken  as  in  place  of 
the  cash  premium,  parol  testimony  going  to  show  that  it  was 
not  so  regarded  by  the  parties  was  admissible  to  rebut  the 
presumption.  In  Faunce  v.  State  Mutual  Life  Insurance 
Company,^  the  new  policy  was  deliverable  as  a  substitute  for 
and  upon  surrender  of  a  prior  policy,  which  surrender  was 
never  made  or  tendered,  but,  on  the  contrary,  enforced  and 
paid  by  the  company.  In  Bidwell  v.  St.  Louis  Floating 
Dock  and  Insurance  Company, ^  the  insured  was  to  execute 
his  note  to  the  company  with  the  indorser,  which  was  never 
done.  [If  the  policy  is  not  to  go  into  effect  until  the  pre- 
mium is  paid,  delivery  of  the  policy  does  not  waive  this  pro- 
vision, and  if  the  policy  states  that  waiver  of  its  terms  must 
be  in  writing,  even  an  agreement  by  the  agent  to  waive  the 
payment  of  the  premium  as  a  condition  precedent  would  be 
of  no  avail.*] 

(t)  Even  the  delivery  of  the  policy  and  the  payment  of  the 
premium  are  not  conclusive  of  a  valid  policy.  There  may 
have  been  a  failure  to  agree, —  a  want  of  that  aggregatio 
mentium  which  is  necessary  to  the  completion  of  the  con- 

1  6  Bush  (Ky.),  450. 

2  101  Mass.  279. 

3  40  Mo.  42. 

*  [Pottsville  Mut.  F.  Ins.  Co.  v.  Miimeona  Springs  Imp.  Co.,  100  Pa.  St.  137.] 

95 


§  57]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC  [CH.  IV. 

tract.  Thus,  where  insurance  is  procured  upon  \^hat  is  de- 
scribed as  a  machine-shop,  but  is  in  reality  an  organ 
factory,  the  description  being  given  by  one  who  applied  in 
the  owner's  name,  a  policy  issued  upon  such  application  will 
not  cover  the  organ  factory,  although  the  owner  may  have 
received  it  and  paid  the  premium,  and  the  representation 
was  made  without  his  knowledge. ^ 

8  57.  Acceptance  subject  to  Approval ;  Interim  Receipt.  — 
But  a  company  which  has  informed  its  agent  that  they  will 
be  liable  for  a  loss  after  the  payment  of  the  premium  to  him, 
and  pending  its  receipt  by  them,  subject,  however,  to  their 
right  to  reject  the  risk,  if  from  the  rate  of  premium  or  other- 
wise it  be  not  satisfactory,  will  not  be  allowed  arbitrarily  to 
reject  it  and  refuse  a  policy,  or  to  reject  it  merely  because  a 
fire  has  intervened.^  Nor  will  the  agent's  neglect  to  for- 
ward the  application  release  the  insurers. ^ 

(s)  So,  where  an  agent  is  merely  authorized  to  receive 
and  forward  applications  on  which  the  company  are  to  issue 
policies,  if  approved,  as  of  the  date  of  the  application.  And 
this  rule  was  applied  where  the  loss  occurred  before  the 
company  had  received,  or,  in  due  course  of  mail,  would 
regularly  receive,  the  application  and  premium  forwarded 
by  their  agent,  and  therefore  had  no  opportunity  to  disap- 
prove; and  where  there  was  no  agreement  for  intermediate 
insurance,  except  what  is  to  be  inferred  from  the  fact  that 
if  approved  the  policy  was  to  bear  the  date  of  the  applica- 
tion. The  contract  was  held  to  be  consummated  on  the  day 
when  the  premium  was  paid ;  and  it  was  said  that  the 
reservation  of  the  right  of  approval  did  not  give  to  the  in- 
surers the  arbitrary  right  to  set  aside  any  contract,  however 
fair,  made  by  their  agent,  but  only  in  cases  where  the  agent  had 
been  imposed  upon,  or  where  the  contract  made  by  the  agent 
would  operate  as  a  fraud  upon  the  right  of  the  company.* 

1  Goddnrd  v.  Monitor  Ins.  Co.,  108  Mass.  57.     And  see  post,  §  566. 

2  Perkins  v.  Washington  Ins.  Co.,  4  Cowen  (N.  Y.),  645  ;  Insurance  Co.  v. 
Wehster,  6  Wall.  (U.  S.)  129.  See  also  Moore  v.  Woolsej',  4  El.  &  B.  243; 
post,  §  496. 

8  Fish  V.  Cottenet,  5  Hand.  (N.  Y.)  538.    And  aeepost,  §69. 
*  Palm  V.  Medina  Ins.  Co.,  20  Ohio,  529. 

96 


CH.  IV.]  CONSUMMATION    OF   THE   CONTRACT.  [§  58 

§  58.  The  cases,  however,  upon  the  effect  of  a  failure  to 
disapprove  are  not  entirely  consistent.  Thus,  in  a  late  case 
in  Pennsylvania,  the  agent  was  authorized  to  receive  and 
forward  applications,  the  insurance  to  take  effect  on  all 
approvable  applications  the  day  they  were  taken.  The  agent 
gave  a  receipt  for  the  premium,  and  forwarded  the  same 
with  the  application  to  the  company,  "if  not  approved  by 
directors,  money  to  be  refunded."  It  appeared,  however, 
that  no  notice  was  taken  of  the  application  by  the  company, 
nor  was  the  money  refunded ;  and  in  point  of  fact  the  com- 
pany denied  that  they  ever  received  the  application  or  the 
premium.  Upon  these  facts  it  was  held  that  there  was  no 
contract  to  insure,  but  simply  a  proposal  forwarded  by  the 
agent;  and  delay  under  such  circumstances  to  forward  a 
policy  or  refund  the  money,  even  if  the  company  received 
the  application,  was  rather  ground  for  inference  that  they 
rejected  than  accepted  the  proposal.  A  proposal  not  an- 
swered remains  a  proposal  for  a  reasonable  time,  and  then 
is  regarded  as  withdrawn.  It  is  only  a  delay  or  neglect  that 
has  a  tendency  to  mislead,  and  which  is  incompatible  with 
honesty,  which  can  be  alleged  as  a  ground  of  liability ;  as 
where  one  knows  that  another  is  acting  as  his  agent  in  a 
particular  matter  without  or  beyond  his  authority,  and  does 
not  promptly  disavow  his  acts.  ^  In  such  cases,  if  the  agent 
neglects  to  forward  the  proposal,  the  company  will  be  liable 
for  the  agent's  neglect. ^  For  a  stronger  reason,  there  will 
be  no  contract  if  it  be  agreed  that,  if  no  notice  of  approval 
or  disapproval  be  given,  the  insurance  shall  cease  in  thirty 
days.  Thus,  a  receipt  setting  forth  that  the  insurance  shall 
cease  on  notice  of  disapproval  of  the  application ;  that  it 
shall  be  good  for  thirty  days,  unless  sooner  determined  by 
notice;  and  that  if  no  notice  of  approval  or  disapproval  be 

1  Insurance  Co.  v.  Johnson  23  Pa.  St.  72,  Woodward,  J.,  dissenting;  Hallock 
V.  Insurance  Co.,  26  N.  J.  L.  268  ;  Alabama  Gold  Life  Ins.  Co.  v.  Mayes  (Ala.), 
9  Reptr.  75.  And  see  also  Myers  v.  Keystone  Mut.  Life  Ins.  Co.,  27  Pa.  St.  268; 
Bennett  v.  City  Ins.  Co.,  115  Mass.  241.  In  Medina  Ins.  Co.  v.  Palm,  5  Ohio 
St.  107,  the  court  intimate  that  the  decision  in.  Palm  v.  Medina  Ins.  Co.  {ante, 
§  57)  is  not  entirely  satisfactory. 

■^  Walker  w.  Farmers'  Ins  Co.,  51  Iowa,  679  ;  post,  §  64. 

VOL.  I.  —  7  97 


§  58]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,    ETC.  [CH.  IV. 

given  it  shall  cease  in  thirty  days,  has  no  binding  force  after 
the  expiration  of  thirty  days,  there  being  no  notice  of  ap- 
proval or  disapproval.  1  On  the  other  hand,  it  has  been  held 
that,  where  a  general  agent  gave  a  receipt  for  the  premium, 
setting  forth  that  if  the  application  was  approved  a  policy 
was  to  be  furnished  in  thirty  days,  or,  if  the  application  was 
declined,  the  premium  was  to  be  returned  on  demand  and 
return  of  the  receipt,  and  that  no  liability  was  to  be  in- 
curred unless  the  risk  was  approved  and  a  policy  issued  at 
the  home  office,  and  the  policy  was  sent  to  the  agent  within 
thirty  days,  but  before  delivery  the  applicant  died,  the  re- 
ceipt did  not  operate  as  a  present  insurance,  either  for  the 
thirty  days  or  till  a  policy  was  issued.  ^ 

(s)  In  an  English  case  the  facts  were  that  the  plaintiff, 
through  an  agent,  insured  in  a  certain  office.  The  agent 
then  left  the  service  of  this  office,  and  became  agent  for 
another.  The  plaintiff,  not  knowing  the  fact,  on  applica- 
tion for  further  insurance,  received  from  the  agent  a  receipt 
for  a  certain  sum  of  money  deposited  in  part  payment  of 
premium  and  duty,  in  consideration  of  which  the  property 
was  to  be  insured  for  one  month,  or  until  notice  that  the 
proposal  was  declined,  pending  the  negotiations  on  behalf  of 
the  new  company.  Upon  the  plaintiff's  observing  this,  he 
wrote  to  the  agent  that  he  knew  nothing  of  the  new  com- 
pany, and  wished  to  be  satisfied  of  its  standing  before  giv- 
ing them  all  the  sums.  Before  any  policy  was  made  out  the 
fire  happened.  Amongst  other  grounds  of  defence  was  this, 
that  when  the  plaintiff  first  received  his  receipt  he  supposed 
he  was  contracting  with  the  first  company,  and  therefore 
there  was  no  agreement  with  the  second.  But  the  court  said 
that  when  the  receipt  was  given  the  contract  was  complete, 
there  being  no  repudiation  by  the  plaintiff,  and  that  the  de- 
fence set  up  on  the  other  ground  was  contemptible  and  ridic- 
ulous. ^  And  so  the  company  was  held  to  be  bound  under 
the  following  state  of  facts:    The   plaintiff  applied  to  the 

1  Barr  v.  Insiirance  Co.  of  North  America,  61  Ind.  488. 

a  Marks  v.  Hope  Mut.  Ins.  Co.,  117  Maf5s.  528. 

8  Mackie  v.  European  Ins.  Co.,  21  Law  Times,  N.  s.  102. 

98 


CH.  IV,]  CONSUMMATION   OF   THE   CONTRACT.  [§59 

agents  of  the  defendants  to  effect  an  insurance  on  certain 
buildings.  The  agent  accepted  the  risk,  and  gave  to  the 
plaintiff  the  usual  interim  receipt,  which  stated  "the  said 
party  and  property  to  be  considered  insured  until  otherwise 
notified,  either  by  notice  mailed  from  the  head  office,  or  by 
me,  to  the  insurer's  address  within  one  month  from  the  date 
hereof,  when,  if  declined,  this  receipt  shall  become  void  and 
be  surrendered.  N.  B.  —  Should  applicant  not  receive  a 
policy  in  conformity  with  his  application  within  twenty  days 
from  the  date  hereof,  he  must  communicate  with  the  secre- 
tary direct,  as  after  one  month  from  this  date  the  receipt 
becomes  void."  The  agent  omitted  to  transmit  the  applica- 
tion to  the  company,  and  the  plaintiff,  not  having  been  noti- 
fied, applied  personally  to  the  agent,  who  stated  such  an 
occurrence  was  not  unfrequent,  and  by  way  of  satisfying  the 
plaintiff  granted  a  fresh  interim  receipt,  repeating  this  on 
four  several  occasions.  It  was  held  (1)  that  such  renewed 
interim  receipts  were  valueless,  there  being  in  fact  no  new 
insurance  effected ;  (2)  that  the  neglect  of  the  agent  to  do 
his  duty  by  forwarding  the  application  to  the  company,  could 
not  operate  to  the  prejudice  of  the  plaintiff;  and  (3)  that 
the  mere  lapse  of  a  month  without  any  notice  to  the  assured 
did  not  render  the  receipt  void,  but  the  stipulation  gave  the 
company  a  month  during  which  to  consider  the  application, 
and  enabled  them  to  terminate  the  risk  within  that  period ; 
but  in  such  a  case,  if  the  company  does  not  intimate  an  in- 
tention of  terminating  the  risk,  then  there  is  a  contract  for 
insurance  for  the  year  binding  on  the  company,  on  the 
same  terms  and  conditions  as  the  ordinary  policies  of  the 
company.^ 

§  59.  Interim  Receipts.  —  Both  insurer  and  insured  under 
an  interim  receipt  are  bound  by  the  conditions  of  the  policy 
ordinarily  issued  by  the  company;  as,  for  instance,  the  in- 
sured, to  give  notice  of  a  change  of  title  to  the  insured 
property,  and  the  insurer,  bound  till  he  gives  notice  to  the 
contrary,  must  give  ten  days'  notice,  if  such  are  the  require- 

1  Hawke  v.  Niagara  District  Mut.  Fire  Jus.  Co.,  23  U.  C.  (Ch.)  139.  See  also 
Patterson  v.  Roi-al  Ins.  Co..  14  id.  169. 

99 


§  60]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,  ETC.  [CU.  IV. 

ments  of  the  policy. ^  But  where  insurance  was  obtained  for 
one  month,  and  a  receipt  taken,  setting  forth  that  the  insur- 
ance was  subject  to  the  conditions  contained  in  the  ordinary 
policies  of  the  company,  and  a  policy,  though  requested, 
was  refused,  on  the  ground  that  it  was  not  usual  for  so  short 
a  term,  it  was  held  that  the  insurer  was  not  bound  by  a  con- 
dition which  he  had  never  seen,  requiring  notice  of,  and  in- 
dorsement of  consent  to,  subsequent  insurance.  2  If  an  agent 
forwards  an  application,  which  distinctly  states  that  only 
the  home  officers  have  authority  to  determine  whether  a  pol- 
icy shall  issue,  his  receipt  for  the  premium,  setting  forth 
that  it  is  binding  on  the  insurers  till  the  policy  is  received, 
is  not  binding  after  the  insurers  give  notice  that  they  reject 
the  application. 3  If  the  receipt  covers  goods  not  covered  by 
the  policy  subsequently  issued,  the  contract  may  be  enforced 
according  to  the  terms  of  the  receipt.* 

Agents  not  unfrequently  make  minutes  of  their  contracts 
in  what  are  called  "binding-books,"  and  in  this  way  may 
bind  several  companies  to  one  insured,  each  for  its  propor- 
tion of  the  total  insurance  required ;  and  this  though  the  in- 
surance be  placed  at  the  discretion  of  the  agent,  the  insured 
not  knowing  where  or  how  much  is  severally  placed.^ 

§  60.  What  constitutes  Delivery  of  Policy.  —  To  constitute 
a  delivery  of  a  policy,  it  is  not  necessary  that  there  should 
be  an  actual  manual  transfer  from  one  party  to  the  other. 
The  agreement  upon  all  the  terms,  and  the  issue  and  trans- 
mission to  the  agent  of  a  policy  in  accordance  therewith,  for 
delivery  without  conditions,  is  tantamount  to  a  delivery  to 
the  insured.^     A  fortiori  if  it  be  delivered  by.  the  agent  to 

1  Grant  v.  Reliance  Ins.  Co.,  44  IT.  C.  (Q.  B.)  229  ;  Havvke  v.  Niagara  District 
Mat.  Fire  Ins.  Co.,  23  U.  C.  (Ch.)  139;  Home  Ins.  Co.  v.  Favorite,  46  111.  263  ; 
Gauthier  v.  Waterloo  Ins.  Co.,  44  U.  C.  (Q.  B.)  490. 

2  Lafleur  v.  Citizens'  Ins.  Co.,  Q.  B.  22  L.  C.  Jnr.  247  ;  Wooddy  v.  Old  Do- 
minion Ins.  Co.  (Va.),  9  Ins.  L.  J.  276.     See  also  ante,  §§  21,  23. 

3  Cotton,  &c.  Life  Ins.  Co.  v.  Scurry,  50  Ga.  48. 

*  Wyld  V.  Liverpool,  &c.  Ins.  Co.,  23  U,  C.  (Ch.)  442. 

5  EllLs  V.  Albany  City  Fire  Ins.  Co.,  50  N.  Y.  402  j  s.  c.  4  Laus.  443  ;  Putnam 
V.  Home  Ins.  Co.,  123  Mass.  324 

^  See  cases  cited  in  the  last  section ;  also  New  England  Fire  &  Mar.  Ins.  Co. 
V.  Robinson,  25  Ind.  536,  537  ;  Whitaker  v.  Farmers'  Union  Ins.  Co.,  29  Barb- 
(N.  Y.)  312 ;  Southern  Life  Ins.  Co.  v.  Kemptou,  56  Ga.  339. 

100 


CH.  IV    ]  CONSUMMATION    OF   THE    CONTRACT.  [§60 

the  broker;^  or  if  the  applicant  agrees  that  the  agent  of  the 
insurers  shall  be  his  agent  for  the  "execution  of  the  cun- 
tract."2  The  delivery  may  be  by  any  act^  intended  to  sig- 
nify that  the  instrument  shall  have  present  vitality,*  as  wlieu 
it  is  held  by  the  agent  of  the  insurers  at  the  request  of  the 
insured,  subject  to  the  order  and  control  of  a  mortgagee 
whose  interest  is  covered  by  it.^  A  policy  purporting  to  be 
"signed,  sealed,  and  delivered,"  as  required  by  the  charter, 
is  complete  and  binding  as  against  the  party  executing  it, 
though,  in  fact,  it  remain  in  his  possession,  unless  some 
further  particular  act  be  required  to  be  done  by  the  other 
party  to  declare  his  adoption  of  it.  No  formal  acceptance 
is  necessary  to  complete  the  delivery.  Whether  there  is  a 
delivery  or  not  is  often  a  question  of  intention.  There  is  a 
delivery  if  the  intention  of  both  parties  is,  that  from  and 
after  a  certain  act  the  policy  shall  become  operative. ^  And 
the  rule  thus  laid  down  has  been  applied  in  a  case  where 
application  was  made  on  the  27th  of  September,  the  first 
year's  premium  to  be  paid  in  advertising  the  insurers' 
agency.  The  application  was  approved,  a  policy  duly  exe- 
cuted, and,  on  the  2d  of  October,  mailed  to  the  agent  of  the 
insurer  who  had  forwarded  the  application.  On  the  4th  of 
October  the  insurer  died.  On  the  5th  of  October  the  policy 
came  to  the  hands  of  the  agent,  and  he  immediately  re- 
turned it  to  the  insurers.  The  agency  was  advertised  as 
agreed.  Upon  these  facts  it  was  held  that  the  contract  was 
complete  when    the    policy  was   mailed    to    the    agent.     If 


1  McLachlin  v.  ^tna  Ins.  Co.,  4  Allen  (N.  B.),  173. 

2  Alabama  Gold  Life  Ins.  Co.  v.  Herron  (Miss.),  10  Ins.  L.  J.  68. 

3  [Delivery  may  be  made  by  mailing  the  policy.  But  where  the  minds  of  the 
parties  never  met,  the  company  does  not  become  bound  by  mailing  a  policy 
which  the  applicant  is  not  bound  to  accept.  Hamblet  v.  City  Ins.  Co.,  36  Fed. 
Kop.  118  (Pa.)  1888.] 

*  Hallock  V.  Com.  Ins.  Co.,  2  Dutch.  (N.  J.)  268;  s.  c.  3  id.  645. 

5  Home  Ins.  Co.  v.  Curtis,  32  Micb.  402. 

6  Xenos  V.  Wickham,  L.  R.  2  H.  of  L.  296,  reversing  same  case  in  the  Ex- 
chequer Chamber.  "  Delivery  is  either  actual,  i.  e.  by  doing  something  and  say- 
ing nothing  ;  or  else  verbal,  i.  e.  by  saying  something  and  doing  nothing  ;  or  it  may 
be  by  both  ;  and  either  of  these  may  make  a  good  delivery  and  a  perfect  deed.' 
1  Sheppard,  Touchstoue,  57.     See  also  Doe  v.  Kuight,  5  B.  &  C.  632. 

101 


§  61]  INSURANCE  :    FIKE,   LIFE,    ACCIDENT,    ETC.  [CH.  IV. 

the  premium  was  not  paid  in  full  it  was  the  fault  of   the 
company.^ 

§  61.  Obligations  Reciprocal ;  The  Company  may  demand 
the  Premium  if  the  Applicant  can  demand  a  Policy,  —  The 
cases  we  have  been  considering  have  been  cases  where  the 
insured  was  seeking  to  enforce  his  rights  against  the  in- 
surers. But  the  insurers  may  have  occasion  to  enforce  their 
rights  against  the  insured;  as  was  the  case  where  a  defend- 
ant made  written  application  for  insurance  to  a  mutual  in- 
surance company.  The  rate  of  premium  was  agreed  upon  by 
the  parties  and  the  policy  was  made  out,  and  the  defendant 
requested  to  take  it  and  sign  the  premium  note  and  pay  the 
premium.  He,  however,  refused,  and  the  policies  were  never 
delivered.  In  an  action  brought  to  recover  the  amount  of 
the  premium  and  certain  assessments,  the  court  held  that 
the  plaintiff  must  fail,  for  the  very  obvious  reason  that  no 
contract  was  ever  completed  between  the  parties.  The  pro- 
ceedings on  the  part  of  the  defendant  were  merely  the  initia- 
tory steps  to  a  contract.  The  plaintiffs,  pursuant  to  the 
defendant's  request,  had  prepared  a  policy  which  would 
take  effect  as  a  contract  on  being  delivered,  and  not  before. 
By  the  plaintiffs'  by-laws  the  policy  was  not  to  be  delivered 
until  the  payment  of  the  premium  and  the  signature  of  the 
deposit  note,  neither  of  which  had  taken  place.  If  a  loss 
had  occurred,  under  the  circumstances  the  plaintiffs  would 
not  have  been  liable,  because  there  was  no  delivery  of  the 
policy.2  But  if  the  case  had  taken  the  form  of  a  bill  in 
equity  to  enforce  a  performance  of  the  contract,  the  payment 
of  the  premium  and  assessments,  and  the  execution  of  the 
deposit  note,  upon  the  general  doctrine,  which  is  so  familiar 
and  so  well  established,  that,  when  all  the  terms  of  the  con- 
tract are  agreed  on,  and  nothing  remains  to  be  done  by 
either  party  but  to  execute,  the  court  will  compel  execution, 
it  is  yet  to  be  decided  that  such  a  bill  would  not  be  sus- 
tained.    The  rights  and  obligations  of  the  parties  are  recip- 


1  Kentucky  Mut.  Ins.  Co.  v.  Jenks,  5  Ind.  96  ;  post,  §  135. 

2  Real  Estate  Mut.  Fire  Ins.  Co.  v.  Roessle,  1  Gray  (Mass.),  336. 
102 


CH.  IV.]  CONSUMMATION   OF   THE    CONTRACT.  [§  62 

rocal,  and  if,  as  we  shall  hereafter  see,^  the  defendant,  in 
this  case,  upon  tender  of  performance  on  his  part,  could 
have  compelled  the  execution  and  delivery  of  a  policy,  it 
would  seem  to  follow  that  the  plaintiils,  on  tender  of  per- 
formance on  their  part,  could  equally  compel  payment  of  the 
premium,  and  the  execution  and  delivery  of  the  deposit  note. 
If  the  insurers,  after  the  completion  of  the  contract,  refuse 
to  accept  payment  of  a  premium  in  the  manner  agreed  upon, 
or  to  execute  the  contract  by  delivery  of  the  policy,  the  in- 
sured, without  the  tender  of  intermediate  premiums,  may 
after  loss  sue  and  recover  as  if  the  policy  had  issued,  less 
the  premium.^ 

§  62.  Effect  of  the  Provisions  of  the  Charter  or  Policy  on 
Rights  of  Parties.  —  The  relation  of  the  delivery  of  a  policy 
by  a  mutual  insurance  company  to  the  consummation  of  the 
contract  was  considered  under  the  following  interesting  cir- 
cumstances :  The  general  and  local  agents  of  the  defendants, 
together,  called  upon  the  plaintiff  on  the  7th  of  October,  and 
after  negotiations  with  him  applications  were  prepared  by 
the  general  agent,  upon  request  to  be  insured  from  that 
time,  and  signed  by  the  plaintiff  in  a  manner  satisfactory  to 
the  general  agent,  who  said  the  policies  would  be  made  out 
without  delay.  The  local  agent  at  the  same  time  told  the 
plaintiff  that  it  made  no  difference  to  him  whether  the  plain- 
tiff paid  the  cash  premium  at  that  time,  or  when  he  should 
take  the  policies;  and  he  did  not  then  pay  it.  The  plaintiff 
then  asked  the  agents  for  a  copy  of  the  by-laws  of  the  com- 
pany, and  was  told  that  they  had  none  with  them,  but  he 
would  be  furnished  with  a  copy  on  the  policies.  No  rules  or 
regulations  of  the  company  were  made  known  to  the  plaintiff. 
It  was  also  understood  between  the  agents  and  the  plaintiff 
that  the  policies  should  be  made  out  at  once,  and  left  with 
M.  and  F.,  M.  being  the  local  agent  and  F.  his  partner,  no 
time  being  fixed  when  the  plaintiff  should  call  for  them. 
The  policies  were  accordingly  executed  and  left  with  F. 
before  the  loss.     F.  was  afterwards  told  by  the  president  of 

1  See  post,  §  565  et  seq. 

2  Shaw  V.  Rep.  Life  Ins.  Co.,  69  N.  Y.  286,  287. 

103 


§  63]  INSURANCE  :   FIRE,   LIFE,    ACCIDENT,    ETC.  [CH.  IV. 

the  company  to  put  them  in  the  safe  and  take  care  of  them, 
but  was  afterwards  directed  by  the  company  not  to  deliver 
them,  and  they  were  subsequently  taken  back  by  the  com- 
pany. On  the  10th  October  the  plaintiff  tendered  the  pre- 
mium to  F.,  while  the  policies  were  yet  in  his  keeping,  but 
after  he  had  been  instructed  not  to  deliver  them,  who  de- 
clined to  receive  it  for  the  company,  but  consented  to  hold 
it  as  a  deposit  till  suit  was  brought,  when  it  was  paid  into 
court.  F.  at  the  same  time  declined  to  deliver  the  policies. 
The  policies  provided  that  each  person  should  pay  upon  the 
execution  of  his  policy,  and  before  its  delivery,  the  pre- 
mium thereon;  that  no  insurance  should  take  effect  until 
the  cash  premium  was  paid;  and  that  no  insurance  agent, 
or  broker,  forwarding  applications,  was  authorized  to  bind 
the  company  in  any  case  whatever.  And  it  was  held  that, 
upon  these  facts,  a  jury  might  find  a  waiver  of  the  right  to 
receive  the  cash  premiums  before  the  delivery  of  the  policies, 
and  if  they  should  find  such  waiver,  the  policies  were  effect- 
ual from  the  time  when  they  were  left  with  F.  for  delivery.^ 

§  63.  Effect  of  Charter  and  By-Laws  (^continued).  —  On  the 
other  hand,  there  are  numerous  and  most  respectable  author- 
ities, that  insurance  companies  whose  charters  and  by-laws 
define  the  mode  in  which  they  may  contract,  and  the  time 
and  circumstances  under  which  their  contracts  shall  become 
binding  upon  them,  cannot  be  held  otherwise  than  in  con- 
formity with  such  provisions.^ 

1  Bragdon  v.  Appleton  Mut.  Ins.  Co.,  42  Me.  259.  Cutting,  J.,  dissented,  on 
the  ground  that  mutual  insurance  companies  cannot  waive  a  compliance  with  the 
terms  and  conditions  upon  which  they  may  by  their  charter  contract,  as  to  which 
it  was  the  duty  of  the  plaintiff  to  have  informed  himself,  adopting  the  rule  laid 
down  in  the  cases  cited  in  the  following  section.  See  also,  to  the  same  point  with 
the  case  above  cited  from  the  Maine  reports,  Pino  v.  Merchants'  Mut.  Ins.  Co., 
19  La.  An.  214  ;  New  England  Fire  &  Mar.  Ins.  Co.  v.  Schettler,  38  111.  166, 167. 
And  see  also  Kelly  v.  Com.  Ins.  Co.,  10  Bosw.  (N.  Y.  Superior  Ct. )  82  ;  ante, 
§  22  ;  post,  §  65. 

2  [All  who  take  out  policies  are  bound  by  the  charter  and  the  laws  of  the  State 
under  which  the  company  is  formed.  Such  laws  are  a  part  of  the  contract  ;  for 
example,  the  provisions  in  regard  to  insolvency.  If  the  proceedings  provided  for 
by  the  charter  and  laws  of  the  home  State  are  adequate,  they  must  be  followed. 
Fry  V.  Charter  Oak  L.  Ins.  Co.,  31  Fed.  Rep.  197  (Mo.)  1887  ;  Parsons  v.  Same, 
id.  305  ;  Weingartner  v.  Same,  32  id.  314.  Persons  dealing  with  the  officers  of  a 
corporation  are  charged  with  notice  of  the  extent  of  their  powers  as  laid  down  in 

10-± 


CH.  IV.]  CONSUMMATION    OF   THE    CONTRACT.  [§  63 

In  the  case  of  Belleville  Mutual  Insurance  Company  v. 
Van  Winkle,^  it  appeared  that  all  the  terras  of  the  contract 
had  been  agreed  upon,  and  that  a  policy  was  to  be  issued 
dated  as  of  the  day  of  the  agreement,  it  being  distinctly 
stated  by  the  secretary  of  the  company  that  the  applicant 
was  thenceforth  insured,  and  that  the  policy  should  be  made 
out  and  sent  right  away.  The  policy  was  executed  upon  the 
eighteenth  day  of  April.  On  the  twentieth  day  the  secretary 
wrote  to  the  applicant,  requesting  him  to  sign  the  enclosed 
premium  note  and  forward  by  return  mail.  On  the  twenty- 
second  day,  and  before  the  note  could  be  returned,  a  fire 
occurred.  The  applicant  then  tendered  his  note  and  de- 
manded his  policy,  which  the  company  refused,  and  placed 
their  refusal  on  the  ground  that  no  deposit  note  had  been 
received  at  the  time  of  the  loss;  whereas,  it  was  provided 
by  the  charter  of  the  company  that  "  every  person  who  shall 
become  a  member  by  effecting  insurance  shall,  before  he 
receives  the  policy,  deposit  his  promissory  note  for  such  a 
sum  of  money  as  shall  be  determined  by  the  directors,"  thus 
making  the  deposit  note  a  condition  precedent  to  the  mem- 
bership. And  the  court,  upon  bill  in  equity  for  relief, 
sustained  this  view,  reversing  the  decree  of  the  court  below. 
The  applicant,  said  the  court,  was  bound  to  know  the  terms 
of  the  charter  and  by-laws,  and  it  was  his  duty  to  see  that 
the  premium  note  was  duly  made  and  deposited,  and  if  he 
chose  to  wait  till  it  could  be  sent  to  him  by  the  secretary 
and  returned,  it  was  at  his  own  peril.  The  by-laws  ex- 
pressly forbade  any  person  becoming  a  member  until  the 
premium  note  was  deposited.  No  officer  had  any  right  to 
dispense  with  this  condition,  and  no  one  had  any  right  to 
rely  upon  his  assurances  that  it  could  be  dispensed  with,  or 

the  charter  and  by-laws.  Adriance  v.  Eoome,  52  Barb.  399,  411.  A  stranger 
dealing  with  the  company  is  presumed  to  have  read  the  statutes  under  which  it  is 
incorporated,  and  the  articles  of  association,  but  where  he  has  no  notice  to  the 
contrary,  he  has  a  right  to  assume  that  all  matters  of  internal  arrangement  have 
been  duly  complied  with.  Re  County  L.  Ass.  Co.,  L.  R.  5  Ch.  288  ;  39  L.  J. 
Ch.  471.  Members  of  a  mutual  insurance  company  are  bound  by  its  by-laws,  so 
far  as  they  are  consistent  with  the  nature  of  the  institution.  Mut.  Ass.  Soc.  v 
Korn,  7  Cranch,  396,  399.] 
1  1  Beas.  (N.  J.)  333. 

105 


64]  INSUKANCE  :  riKE,   LIFE,   ACCIDENT,   ETC.  [CH.  lY. 

that  the  insurance  should  take  effect  before  the  deposit  of 
the  note.  ^ 

§  64.  Effect  of  Charter  and  By-Laws  (continued) ;  Neglect 
of  Officer.  —  But  though  mutual  insurance  companies  and 
others  may  be  inhibited  by  the  terms  of  their  charter  from 
issuing  policies  except  upon  certain  conditions,  it  does  not 
follow  that  they  are  inhibited  from  agreeing  to  issue  a  policy 
in  conformity  with  those  conditions. ^  This  was  what  was 
done  in  the  New  Jersey  case  just  cited.  And  although  the 
secretary  may  have  transcended  his  power  when  he  under- 
took to  say  that  the  insurance  should  take  effect  from  and 
after  the  time  of  the  conference,  it  was  not  beyond  his  right 
to  promise  that  the  policy  should  be  sent  right  away.  Had 
this  been  done,  the  policy  would  have  been  delivered  at  the 
time  of  the  loss  as  a  valid  and  binding  policy.  It  was  be- 
cause he  did  not  forward  the  note  to  be  signed  "right  away," 
as  he  had  agreed  to  do,  that  the  policy  was  not  issued  before 
the  fire.  The  secretary  had  a  right  to  make  this  promise  on 
behalf  of  the  company,  and  the  applicant  had  a  right  to  rely 
upon  it,  and,  it  seems,  did  rely  upon  it.  He  was  lulled  into 
security  by  it;  and  by  the  fault  of  the  secretary,  that  is,  the 
company,  he  was  without  his  promised  policy  when  the  fire 
occurred.  If  the  fire  had  not  occurred,  can  it  be  doubted 
that  on  a  tender  of  the  deposit  note  in  response  to  the  secre- 
tary's note  enclosing  it  for  signature,  and  refusal  of  the  com- 
pany to  issue  the  policy  thereupon,  a  bill  in  equity  to  enforce 
the  delivery  of  the  policy  would  have  been  sustained?     If  so, 

1  Barrett  v.  Union  Mut.  Fire  Ins.  Co.,  7  Cash.  (Mass.)  175- ;  Real  Estate  Mut. 
Fire  Ins.  Co.  v.  Roessle,  1  Gray  (Mass.),  336  ;  Montreal  Ins.  Co.  v.  McGilivray, 
9  L.  C.  (Q.  B.)  488  ;  Spitzer  v.  St.  Mark's  Ins.  Co.,  6  Duer  (N.  Y.  Superior  Ct.), 
6  ;  Mound  City  Mut.  Fire  Ins.  Co.  v.  Curran,  42  Mo.  374.  See  also  Flint  v. 
Ohio  Ins.  Co.,  8  Ohio,  501.  This  ground  of  defence  would  doubtless  have  been 
sufficient  had  it  been  answered  to  an  action  at  law  on  the  policy.  A  promise  by 
the  treasurer  to  see  that  the  premium  is  paid  is  not  the  equivalent  nor  a  waiver 
of  the  payment.  Buffum  v.  Fayette  Mut.  Fire  Ins.  Co.,  3  Allen  (Mass.),  360. 
And  see  also  Mulrey  v.  Shawmut  Mut.  Fire  Ins.  Co.,  4  Allen  (Mass.),  116, 
which  was  a  case  where  the  policy  had  been  delivered,  but  the  premium  had 
not  been  paid  to  the  company,  though  it  had  been  paid  to  the  agent,  with  whom 
they  settled  monthly.  The  payment  of  the  premium  was  a  condition  precedent  to 
the  validity  of  this  policy. 

2  See  cases  cited  ante,  §§  22,  23. 

106 


CH.  ^\^]  CONSUMMATION    OF   THE    CONTRACT.  [§  65 

how  can  the  intervention  of  the  fire  change  the  obligations 
of  the  parties  already  previously  entered  into  ?  It  would 
seem  that  the  company  ought  to  be  liable  in  such  case  for 
all  damages  resulting  from  their  agent's  failure  to  forward.^ 
The  neglect  in  such  case  was  the  neglect  of  the  company, 
and  differs,  therefore,  from  the  neglect  of  the  agent  in  Iloyt 
V.  Mutual  Benefit  Life  Insurance  Company, ^  who,  after  ten- 
dering the  policy,  and  requesting  payment  of  the  premium, 
promised  to  call  on  a  third  person,  to  whom  the  applicant 
had  referred  him  for  the  premium,  but  did  not.  This  was 
held  to  be  a  merely  personal  undertaking  on  the  part  of  the 
agent,  in  no  way  binding  upon  the  company,  and  the  facts 
and  circumstances  were  not  the  equivalent  of  the  actual 
delivery  of  the  policy  and  payment  of  the  premium. 

[§  64  A.  A  subsequent  alteration  of  the  charter  or  by-laws 
cannot  in  general  affect  the  contract  of  the  assured.  ^  But 
the  future  by-laws  of  a  society  may  by  agreement  be  made 
part  of  the  policy  issued  by  the  society.*  If  the  policy  is 
inconsistent  with  a  by-law  the  latter  is  waived.^  A  by-law 
excluded  by  the  terms  of  the  contract  does  not  affect  it.^] 

§  65.  Countersigning  by  Agent.  —  In  general,  when  the 
policy  provides  that  the  counter-signature  of  an  agent  is 
requisite  to  the  validity  of  the  policy,  this  counter-signature 
must  be  had.'^  But  this  stipulation  in  a  policy  may  doubt- 
less be  waived.^     Countersigning  by  the  agent  is  evidence 

1  Walker  v.  Farmers'  Ins.  Co.,  51  Iowa,  679;  Christie  v.  NortH  British  Ass. 
Co.,  3  Ct.  of  Sess.  Cas.  (Scotch)  360;  Somerset  Ins.  Co.  v.  May  (Pa.),  2  W. 
N.  C.  43  ;  Tome  v.  Parkersburg  Br.  R.  R.  Co.,  39  Mil.  36  ;  Williams  v.  Canada 
Farmers'  J\Iut.  Ins.  Co.,  27  U.  C.  (C.  P.)  119  ;  post,  §  69  ;  Patterson  v.  Royal 
Ins.  Co.,  14  U.  C.  (Ch.)  169  ;  Fish  i'.  Cottenet,  5  Hand.  (N.  Y.)  138  ;  Franklin 
Fire  Ins.  Co.  v.  Taylor,  52  Miss.  441  ;  Wooddy  u.  Old  Dominion  Ins.  Co.  (Va.), 
9  Ins.  L.  J.  276  ;  post,  §  67. 

2  98  Mass.  539  ;  ante,  §  55. 

8  [Morrison  v.  Wis.  0.  F.  Mut.  Life  Ins.  Co.,  59  Wis.  162.] 
*  [Supreme  Commandery,  &c.  v.  Ainsworth,  71  Ala.  436.] 

5  [Davidson  v.  Old  People's  Mut.  Ben.  Ass.,  39  Minn.  303.] 

6  [Doane  v.  Millville  Ins.   Co.,  45  N.  J.  Eq.  274.] 

■7  Hardie  v.  St.  Louis  Mut.  Life  Ins.  Co.,  26  La.  An.  242. 

^  [Countersigning  maybe  icaived  by  delivery,  but  proof  of  proper  delivery  is  essen- 
tial. Although  a  policy  declares  that  it  shall  not  be  valid  until  countersigned  by 
R.  this  condition  may  be  waived  by  R.,  by  receiving  the  premium  and  delivering 
the  policy  without  such  signature.     Chapman  v.  Delaware  M.  Ins.  Co.,  23  N.  B. 

107 


^  6o^  INSUKANCE  :   FIRE,   LIFE,    ACCIDENT,    ETC.  [cH.  IV. 

of  the  completion  and  delivery  of  the  contract.  Yet  if  this 
evidence  be  wanting,  other  evidence  may  be  equivalent;  as, 
for  instance,  a  delivery  by  letter  from  the  agent. ^  And  the 
counter-signature,  at  all  events,  is  only  necessary  when  a 
policy  is  issued.  Though  the  charter  of  the  company,  or 
general  statute  law,  or  instructions  to  the  agent,  require  the 
counter-signature  of  agents  to  policies,  companies  may,  by 
themselves  or  their  agents,  agree  to  issue  policies,  and  be 
bound  thereby.  2  The  fact,  however,  that  a  policy  is  issued 
to  its  own  agent  upon  his  life  does  not  dispense  with  his 
counter-signature  in  order  to  make  the  policy  valid,  if  the 
policy  itself  provides  that  it  shall  have  no  force  until  coun- 
tersigned by  such  agent.  Though  the  agent  receive  the  pol- 
icy, and  place  it  amongst  his  private  papers,  it  is  no  valid 
contract  till  it  is  countersigned  by  him.^  Nor  can  an  agent 
renew  a  policy  on  his  own  life  by  charging  the  premium  in 
his  account  with  the  company,  if  by  the  terms  of  the  policy 
the  payment  is  not  to  be  binding  unless  acknowledged  by  a 
receipt  signed  by  the  president  or  secretary.*     The  delivery 

E.  121.  The  blank  for  the  counter-signature,  "  This  policy  is  not  valid  unless  coun- 
tersigned by  agent  at .     Countersigned  this  day  of 187 

agent,"  is  only  a  meaningless  form,  and  a  policy  delivered  without  such  signature 
is  valid.  O'Donnell  v.  Confederation  L.  Ins.  Co.,  2  Russ.  &  Geld.  (Nova  Sco.) 
231.  In  this  case  the  policy  was  executed  as  fully  as  the  charter  required,  the 
counter-signature  being  an  addition  to  charter  requisites.  Where  a  policy  which 
by  its  conditions  is  not  valid  till  countersigned  and  delivered,  is  sent  to  the  agent 
to  be  so  signed  and  delivered  when  the  premium  was  paid,  and  there  is  evidence  that 
the  premium  was  paid  but  the  policy  was  never  signed  and  delivered,  it  was  held 
that  the  company  was  not  liable;  the  policy  was  not  completed.  Confederation 
L.  Ass.  V.  O'Donnell,  10  Can.  S.  C.  K.  92  ;  13  Can.  S.  C.  R.  218  (a  great  variety  of 
opinion  among  the  judges).  Mere  possession  by  the  assignee  of  the  assured  of  a 
policy  stating  on  its  face  that  it  is  not  to  take  effect  until  signed  by  the  agent, 
and  which  is  not  so  countersigned,  is  no  evidence  that  the  policy  was  ever  deliv- 
ered to  the  insured.    Prall  v.  Mut.  Protection  L.  Ass.  Soc,  5  Daly  (N.  Y. ),  298,  299.] 

1  Myers  v.  Keystone  Mut.  Life  Ins.  Co.,  27  Pa.  St.  268  ;  United  Life,  Fire, 
&  Mar.  Ins.  Co.  v.  Insurance  Co.  of  N.  A.,  42  Ind.  588  ;  Westchester  Fire  Ins. 
Co.  V.  Earle,  33  Mich,  143  ;  Hibernia  Ins.  Co.  v.  O'Connor,  29  Mich.  241. 

2  Walker  v.  Met.  Ins,  Co.,  56  Me.  371  ;  Kelly  v.  Com.  Ins,  Co.,  10  Bosw, 
(N.  Y.  Superior  Ct.)  82  ;  Ellis  v.  Albany  City  Fire  Ins.  Co.,  4  Lans.  (N.  Y.) 
433;  s.  c.  50  K  Y,  402. 

8  Badger  v.  The  American  Popular  Life  Ins.  Co.,  103  Mass.  244.  But  see 
Norton  V.  Phoenix  Mut.  Life  Ins,  Co.,  36  Conn.  503. 

*  Donald  v.  Life  Ins.  Co.,  4  S.  C.  (Richardson)  321.  See  also  Neuendorff  v. 
"World  Mut.  Life  Ins.  Co.,  69  N.  Y.  389, 

108 


CH.  IV.]  CONSUMMATION    OF    THE   CONTKACT.  [§  66 

by  an  unauthorized  person  of  a  policy  requiring  the  counter- 
signature of  a  particular  local  agent  to  make  it  valid,  is  of 
no  effect  if  the  counter-signature  of  the  agent  be  wanting. ^ 

§  6Q.  Place  of  Contract.  —  It  follows  from  the  rule  that 
the  contract  is  completed  when  the  proposals  of  the  one 
party  have  been  accepted  by  the  other  by  some  appropriate 
act  signifying  the  acceptance,  that  the  place  of  contract  is 
the  place  of  the  acceptance.  And  if  an  agent,  resident  in 
one  State,  of  an  insurance  company  resident  in  another,  for- 
wards the  requisite  papers  to  the  home  office,  and  a  policy 
is  thereupon  issued  and  mailed  directly  to  the  applicant,  the 
contract  is  a  contract  made  in  the  State  where  the  home 
office  is  situated ;  and,  since  the  acceptance  is  the  test  of 
completion,  it  would  seem  that  a  transmission  of  the  policy 
by  mail  to  the  agent,  to  be  delivered  by  him  to  the  appli- 
cant, would  have  the  like  effect.  ^  (a)     And  upon  this  ground 

1  Lynn  v.  Burgoyne,  13  B.  Mon.  (Ky.)  400. 

2  [Policies  signed  and  sealed  in  Ontario,  and  sent  to  an  agent  in  N'ew  York 
who  tills  them  up  and  issues  them  there,  are  Ontario  contracts.  Clarke  v.  Union 
F.  Ins.  Co.,  6  Out.  R.  223.] 

(a)  Where  application  is  sent  by  an  another  State.      Hicks  v.   ISTational  L. 

applicant  or  his  agent  from  one  State  to  Ins.  Co.,  60  Fed.  Rep.  690.      See  Brei- 

an  insurance  company  of  another,  and  tung's  Estate,  78  Wis.   33 ;    Mutual  L. 

there  accepted,  and  a  policy  of  insurance  Ins.  Co.  v.  Dingley,  100  Fed.  Rep.  408; 

is  there  issued,  it  is  a  contract  of  the  Seiders  v.  Merchants'  L.  Ass'n  (Texas), 

State  where  issued,  as  the  place  of  the  54  S.    W.    753.      A  policy    written  in 

acceptance  of  a  proposal  is  in  general  Massachusetts  by  a  company   resident 

the  place  of  contract  ;  but  a  polic}-  of  there,    and   sent   to  its   agent  in  New 

insurance  providing  that  it  shall  not  be  Hampshire,  becomes  a  New  Hampshire 

valid  until  countersigned  by  its  agent  contract  upon  delivery  to  the  insured, 

at  a  certain  place,  is  a  contract  of  the  and  the  rights  of  parties  under  it  are  to 

State  where  so  countersigned.      Gallo-  be  determined  by  New  Ham]ishire  laws, 

way  V.  Standard  F.  Ins.  Co.,  45  W.  Va.  Perry   v.  Dwelling-House  Ins.  Co.,    67 

237.     See  Equitable  L.  Ass.  Society  v.  N.   H.  291.     If  an  application  for  life 

Trimble,  83  Fed.   Rep.  85  ;  State  Mnt.  insurance  is  made,  and  the  policy  is  de- 

F.  Ins.  Ass'n  v.  Brinkley  Stave  Co.,  61  livered,    and   the  premium   is  paid   in 

Ark.    1;    Curnow  v.   Phcenix  Ins.   Co.,  Maryland,  the  courts  of  that  State  have 

37  S.  C.  406  ;  Voorheisv.  People's  Mut.  jurisdiction,  and  the  policy  of  a  Penn- 

Ben.  Society,  91  Mich.  469.     A  policy  sylvania  company,  although  sued  on  in 

ap])lied  for  in  New  York  and  delivered  Maryland,  is  to  be  construed  by  Penn- 

there,  if  the  premiums  are  paid  there,  sylvania  statutes,  and  conditions  of  the 

is    a    New    York    contract,     notwith-  policy,  which  miglit  otherwise  be  valid 

standing  it  is  issued  and  signed  in  an-  in  ilaiyland,  are  invalid  so  far  as  they 

other  State  by  a  company  resident  in  confiict  with  the  statutes  of  the  State 

109 


§  66  A]  INSUKANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  IV. 

it  was  held  that  a  New  York  company  which  had  accepted 
proposals  forwarded  by  its  agent  from  Ohio  did  not  come 
within  the  statute  of  Ohio  which  prohibits  foreign  insurance 
companies  to  insure  in  Ohio  without  license.  ^  If,  however, 
by  the  terms  of  the  policy,  it  is  not  to  be  binding  unless 
countersigned  by  an  agent  resident  at  a  designated  place, 
that  place  must  be  regarded  as  the  place  where  the  contract 
is  made,  and  the  laws  and  usages  of  that  place  must  govern 
in  the  interpretation  of  the  contract.^  And  if  the  policy  be 
sent  to  the  agent  for  delivery  on  receipt  of  the  premium,  the 
contract  is  completed  at  the  agency.  ^ 

[§  66  A.  And  the  contract  may  be  subject  to  the  laws  of 
the  State  of  the  assured,  although  the  premium  is  made  pay- 
able at  the  home  office.  Where  an  application  was  made  in 
Missouri  and  sent  to  New  York,  and  the  policy  was  executed 

1  Hyde  v.  Goodnow,  3  Conist.  (N.  Y.)  266;  Huntley  v.  Merrill,  32  Barb. 
(N.  Y.)  626  ;  Western  v.  Genesee  Mut.  Ins.  Co.,  12  N.  Y.  258  ;  Bowser  v.  Lamb, 
C.  Ct.  (Ind.)  6  Ins.  L.  J.  375  ;  Whitcomb  v.  Phoenix  Ins.  Co.,  C.  Ct.  (Mass.)  Sid. 
624  ;  post,  §  863  ;  Shattuck  v.  Mut.  Life  Ins.  Co.,  C.  Ct.  (Mass.)  7  Ins.  L.  J.  937. 

2  Daniels  v.  Hudson  Eiver  Fire  Ins.  Co.,  12  Cush.  (Mass.)  416;  Moore  v.  Charter 
Oak  Life  Ins.  Co.,  Sup.  Ct.  (Cincinnati)  8  Ins.  L.  J.  78  ;  [Heebner  v.  Eagle  Ins. 
Co.,  10  Gray,  131,  143.  The  law  of  the  State  in  which  the  policy  is  counter- 
sif^ned  determines  its  validity.  Northwestern  Mut.  L.  Ins.  Co.  v.  Elliott,  5  Fed. 
Rep.  225;  11  Repr.  325;  6  Sawy.  17.  Contra,  Whitcomb  v.  Phoenix  Mut.  Ins. 
Co.,  8  Repr.  642  (Mass.),  1879;  Smith  v.  Mut.  L.  Ins.  Co.,  5  Fed.  Rep.  582, 
10  Ins.  L.  J.  180  (1881).] 

3  Thwing  V.  Great  Western  Ins.  Co.,  Ill  Mass.  93. 

from  which  the  company  comes.  Fidelity  an  assignment  thereof  being  governed 

Mut.  L.  Ass'n  v.  Ficklin,   74  Md.  172.  by  the  laws  of  another  State.  Union  Cen- 

Where  the  insured  requested  by  letter  tral  L.  Ins.  Co.  v.  Woods,  11  Ind.  App. 

a  policy   from  an  agent  living  in   an-  335  ;  Miller  v.  Campbell,  140  N.  Y.  457. 

other  county,  by  whom  it  was  i.ssued,  If  an    application    for   insurance  is 

the  transaction  was  held  to  have  taken  mailed  from  one  State  to  the  home  office 

place  in  the  county  of  the  agent,  within  of  a  company  in  another  State,   which 

the  meaning  of  a  statute  requiring  suit  is  not  authorized  to  do  business  in  the 

to  be  brought  where  the  transaction  took  former  State,  and  there  accepted,  and 

place.    Sun  Mut.  Ins.  Co.  v.  Crist  (Ky. ),  the  policy  is  sent  by  mail,  the  contract 

26  Ins.    L.  J.   695.      The   laws  of  the  is  one  which  the  resident  of   the  fiist 

place  of  contract  are,  in  the  absence  of  State  is  entitled  to  make  ;  and  the  iu- 

evidence,  presumed   to  be  the  same  as  surer's    adjuster  has    a    constitutional 

those  where  action  is  brought.      Good-  right  to  come  there,  and  to  follow  his 

•win  V.  Provident  Savings  L.  Ass'n,  97  business  in  any  State  where  his  employ- 

Iowa,  226.  ment   calls  him.     French  v.  People,   6 

The  fact  that  a  policy  is  governed  by  Col.   App.   311;   see  Marden   v.    Hotel 

the  laws  of  one  State  does  not  prevent  Owners'  Ins.  Co.,  85  Iowa,  584. 

110 


CH.  IV.] 


CONSUMMATION   OF   THE   CON  TK ACT. 


[§  66  A 


in  New  York  and  sent  by  mail  to  Missouri,  and  the  pre- 
miums made  payable  in  New  York,  it  was  held  that  the 
policy  was  subject  to  the  Missouri  statute.  ^  (a)  Suit  on  a 
premium  note  given  in  P.  state  to  the  agent  of  a  company 
chartered  in  B.  state  is  subject  to  the  laws  of  P.  state.  2  A 
contract  must  be  governed  by  the  law  of  the  country  where  it 
was  made. 3  Where  a  contract  of  insurance  is  finally  exe 
cuted  and  delivered  is  the  lex  loci  contractus^     The  interpre- 

1  [Wall  V.  Equitable  L.  Ass.  Co.,  32  Fed.  Rep.  273  (Mo.),  1887.] 

2  [Thornton  v.  Western  Reserve  Farmers'  Ins.  Co.,  31  Pa.  St.  529,  532. 

3  [Wall  V.  Roberts,  3  Esp.  163,  164.] 

4  [Heebner  v.  Eagle  Ins.  Co.,  10  Gray,  131,  143.  As  to  enforcing  and  ex- 
pounding the  contract,  see  Cox  v.  United  States,  6  Peters,  172,  203  ;  Duncan  v. 
United  States,  7  Peters,  435,  449.] 


(«)  Where  the  insured  in  Missouri 
applied  to  a  New  York  company  for  a 
twenty-payment  distribution  policy  stip- 
ulated in  the  application,  which  was 
part  of  the  policy  to  be  governed  by  the 
Kew  York  statute,  such  policies  being  a 
class  by  themselves  in  which  the  profits 
are  divided  among  the  holders,  in  which 
the  first  two  annual  premiums  are  paid 
together  in  advance ;  and  the  agent 
by  receipt  acknowledged  payment  of  a 
sum  less  than  the  regular  amount  as 
a  payment  for  two  years,  provided  that  if 
the  application  was  not  accepted  by  the 
company  the  note  was  to  be  returned  ; 
and  a  policy  was  duly  transmitted  to  the 
insured,  through  the  local  agent,  to  be 
delivered  on  payment  of  premium  ;  and 
the  third  annual  premium  was  not  paid 
when  due,  and  the  insured  died  soon 
after  ;  an<l  under  the  statute  of  ]\Iis- 
souri  it  continued  in  force,  though  under 
the  statute  of  New^  York  it  was  void,  it 
was  held  to  be  a  Missouri  contract,  and 
governed  by  the  law  of  that  State,  not- 
withstanding the  stipulation  of  the  par- 
ties. Horton  v.  New  York  L.  Ins.  Co., 
151  Mo.  604.  See  Gibson  v.  Conn.  F. 
Ins.  Co.,  77  Fed.  Rep.  561  ;  Equitable 
L.  Ass.  Society  v.  Winning,  58  id.  541  ; 
Mutual  Benefit  L.  Ins.  Co.  v.  Robison, 
id.  723  ;  Equitable  L.  Ass.  Society  v. 
Clements,  140  U.  S.  226  ;  Wiestling  v. 
Wartbin,  1  Ind.  App.  217.     In  an  ac- 


tion in  Missouri  by  the  insurer  against 
a  railroad  for  causing  a  fire,  where  the 
former  was  not  authorized  to  do  busi- 
ness in  the  State,  but  the  insurance  was 
first  effected  in  Illinois  by  the  president 
of  the  lumber  corporation,  and  the  pre- 
miums, though  paid  by  him,  were  ulti- 
mately paid  by  the  corporation  itself,  it 
was  held  that  Illinois  was  the  yilace  of 
contract,  and  that  the  laws  of  Missouri 
did  not  apply.  Lumbermen's  Mat.  Ins. 
Co.  V.  Kansas  City,  Ft.  S.  &  M.  R.  Co., 
149  Mo.  165.  Where  an  industrial 
policy  in  a  New  York  company,  insuring 
the  life  of  C,  a  resident  of  Rhode  Island, 
payable  to  one  of  certain  persons  whose 
relationship  was  described,  was  taken 
out  by  an  aunt  )the  plaintiff),  living  in 
Rhode  Island,  whose  name  did  not  ap- 
pear in  connection  with  the  contract ; 
and,  the  policy  having  lapsed,  a  revival 
application  was  sent  from  Massachusetts, 
where  she  had  moved,  by  the  aunt,  and 
the  policy  was  stamped,  revived,  and  re- 
turned to  Massachusetts;  and  the  insured 
continued  to  reside  in  Rhode  Island,  it 
was  held  that  both  the  original  and  re- 
vived policies  were  Rhode  Island  and 
not  Massachusetts  contracts,  and  that 
the  place  of  performance  was  the  place 
of  contract,  unless  otherwise  intended. 
Bottomley  v.  Met'n  L.  Ins.  Co.,  170 
Mass.  274. 

]11 


G6  A]  INSUIIANCE  :   riEE,   LIFE,   ACCIDENT,   ETC.  [CH.  IV, 

tation  of  contracts,  however,  is  not  always  governed  by  the 
same  law  that  decides  its  validity.  Usage  and  all  other  aids 
to  the  discovery  of  the  real  intent  of  the  parties  must  be 
taken  into  account.  The  standard  of  seaworthiness  is  that 
supplied  by  the  custom  of  the  port  and  country  to  which  the 
vessel  belongs,  not  that  of  the  place  where  the  insurance  is 
made.i  Tj^e  separation  of  a  city  from  a  State  has  no  effect 
upon  existing  contracts  of  insurance,  though  subsequent 
ones  might  be  thus  prohibited,^  as  where  a  company  could 
only  insure  houses  in  the  state  (Va.)  from  which  the  city 
went] 

1  [The  Titania,  19  Fed.  Kep.  101  S.  P.  S.  Dist.  of  N.  Y.  1883.] 

2  [Korn  V.  Mut.  Ass.  Co.  of  Va.,  6  Cr.  192,  199  (U.  S.).] 


112 


TERMINATION   AND   REVIVAL.  [CH.  V. 


CHAPTER  Y. 

termination  and  revival. 

Cancellation.  —  Sukrendee.  —  Renewal.  —  Reviver. 

Analysis. 

a.     Cancellation  : 

requires  agreement,  reserved  right,  or  some  fact  on  which  equity  can 
act,  §§  67,  67  A,  67  M. 
abandonment  by  the  assured  not  assented  to,  no  effect,  §  67. 

1.  By  agi'eement  distinct  from  the  policy. 

a  compromise  involving  surrender  and  cancellation  terminates  the 

contract,  §  67  A. 
a  receipt  acknowledging,  may  be  rebutted  if  without  considera- 
tion, §  67  A. 
member  of  a  mutual  company  cannot  escape  assessments  by  can- 
cellation after  the  company  is  insolvent,  §  67  A. 
may  be  effected  by  agent  of  assured,  §  67  B. 

partner's  assent  to,  conclusive  on  firm,  §  67  B. 
agent  cannot  keep  such  policy  alive  for  himself,  §.  67  B. 
an  agent  to  procure  insurance  does  not  necessarily  have  au- 
thority to  consent  to  cancellation,  §  67  B. 
assent  of  beneficiary  necessary,  §§  67,  67  C. 

2.  Under  conditions  named  in  the  contract. 

construction  of  these  is  strict,  §§  67,  69. 
the  right  must  be  exercised  before  loss,  §  67. 
by  bringing  suit,  §  67. 

Notice  : 

must  be  reasonable,  §§  67  D,  67  L. 

must  be  unconditional  demand,  not  a  mere  expression  of  de- 
sire, §  67  D. 
must  be  in  present  tense,  §§  67,  67  D. 
length  of  time  before  cancellation,  §  68. 
to  the  company's   agent   to  cancel  is  operative  as  soon  as 

the  assured  knows  of  it,  §  67  E. 
and  a  subsequent  agreement  with  the  agent  to  continue  the 

policy  is  void,  §  67  E. 
by  mail,  §  67. 
by  bringing  suit,  §  67. 
mistake  in,  not  fatal,  §  68. 
8.    To  whom  notice  must  be  given, 

assured  or  his  authorized  agent,  §  67  F. 

finding  notice  amoiig  assured's  papers  after  his  death  not  suffi- 
cient, §  67  F. 
VOL.  I.— 8  113 


INSUKANCE  :   FIKE,   LIFE,   ACCIDENT,    ETC.  [CH.  V. 

notice  to  general  agent  of  assured  sufficient,  §  67  F. 

although  same  person  was  agent  for  company,  §  67  F. 
notice  to  special  agent  for  procuring  the  insurance  not  good, 
§  67  G. 
e.  g.  broker,  §§  67  H,  67  L. 
unless  custom  makes  broker  agent  to  receive  notice,  §§  67, 
67  I ;  see  §  67  L. 
or  the  policy  declares  he  shall  be  deemed  the  agent  of  as- 
sured (?)  §§  67  I,  67  H. 
to  one  of  two  persons  severally  interested  does  not  affect  the 
other,  §  67. 

4.  Return  of  the  unearned  premium  is  also  usually  a  condition  of  cancel- 

lation, §§  67,  67  J. 
if  a  premium  was  paid  to  the  company,  actual  tender  of  the 

return  premium  is  necessary,  §  67  J. 
except  where  the  cancellation  is  by  agreement,  §  67  K. 
a  credit  unassented  to  is  insufficient,  §  67  J. 
but  if  no  premium  was  paid,  as  where  credit  was  given,  no  re- 
turn is  necessary,  §  67  K. 
if  only  a  note  was  given  the  return  premium  is  a  credit  on  it, 

§67  K. 
agent  retaining  premium  after  notice  of  disapproval,  with  as- 
sent of  assured,  will  not  save  the  insurance,  §  69. 
For  non-payment  of  premium  must  be  before  tender  of  the  premium  ; 

Canada  statute,  §  67. 
For  refusal  to  pay  assessment,  means  legal  assessment. 

5.  The  company  versus  its  agent,  §  67. 

where  the  time  to  be  allowed  the  assured  to  get  new  insurance  is 
left  to  the  agent  and  he  allows  three  days,  there  is  no  such  abuse 
of  discretion  as  will  make  him  liable  to  the  company,  §  67  L. 

but  delay  of  five  days  in  conmiunicating  with  assured,  agent 
responsible,  §  67  L. 

agent  cannot  delegate  discretion  of  cancellation,  §  67  L. 

agent  is  responsible  to  company  if  he  gives  notice  to  broker,  in- 
stead of  assured,  and  so  fails  to  cancel,  §  67  L. 
and  evidence  of  a  custom  to  do  so,  will  not  be  received  in 

his  favor,  §  67  L. 
agent  has  commission  only  on  premiums  earned,  §  67  L. 

6.  Of  policy  will  be  decreed  in  equity, 

where  the  assured  had  no  interest,  §  67  M- 

where  the  policy  was  obtained  by  fraud,  §  67  M. 

but  not  for  intemperance,  §  67  M,  the  assured  may  reform. 

7.  Mistake  of  agent  in  notice  in  designating  date  of  cancellation,  not  ma- 

terial, §  68.  » 

neglect  of  agent  not  prejudice  assured,  §  67. 

cancellation  of  interim  receipt,  or  contract,  subject  to  approval,  §  69. 
agreement  with  agent  after  notice  of  disapproval  to  the  assured, 
will  not  save  the  contract,  though  the  agent  retains  the  pre- 
mium, §  69. 
an  agreement  without  consideration,  subsequent  to  delivery  of 
a  policy,  will  not  turn  it  into  a  contract,  taking  effect  only 
on  approval,  §  69. 

114 


CJI    v.]  TERMINATION    AND    REVIVAL. 

B.  Surrender : 

meeting  of  minds,  and  delivery  of  poli<-y,  with  intent  to  surrender  it, 

terminates  it,  §§  t)9,  69  B. 
if  in  a  mutual  company  the  member  is  no  longer  liable  for  assessments, 

§  69  B. 
unless  the  comi-any  was  insolvent  at  time  of  surrender,  ^  67  A. 
re-delivery  by  the  agent  after  knowledge  of  a  lo^s  cannot  revive  the 

oi/rondition,  is  incomplete  until  condition  is  fulhlled,  §  69  B. 
after  forfeiture,  assured  can  recover  no  premiums,  §  69  B. 

C.  Renewal : 

W^Hut  constitutes 

Parol  renewal  good  even  though  the  original  policy  stipulates 

otherwise,  §  70  B.  r         i.  i 

but  a  policy  under  seal  cannot  be   continued  in  force  by  parol, 

§  70  B.  , 

the  suit  would  have  to  be  on  the  parol  contract,  not  on  the 

policy  of,  §  70  B. 
if  a  parol  agreement  to  renew  is  indeterminate,  or  a  mere  agree- 
ment with  the  agent  that  when  the  time  comes  he  wull  make  a 
renewal,  it  is  very  well  not  to  hold  the  company,  §  70  B, 
but  a  present  parol  contract  of  renewal  or  revival,  or  a  contract 
to  issue  a  policy  in  renewal  at  the  proper  time  ought  to  be 
binding  under  similar  circumstances  and  to  the  same  extent,  as 
a  parol  agreement  with  the  same  agent  for  an  original  policy, 
and  the  authorities  countenance  this  view,  §  70  B. 
Care  must  be  taken  as  to  the  form  of  the  suit.     If  there  is  any  doubt 
about  the  renewal,  suit  should  not  be  on  the  old  policy  but  on  the 
parol  agreement  to  renew.      Attention  to  this  point,  and  to  the 
special  facts  of  each  case,  brings  the  decisions  all  into  harmony. 
(SeeCh.  ii.  Anal.  1.) 

Terms  of : 

same  as  original  contract,  if  not  modified  by  a  new  application, 
or  by  circumstances,  §  70  a,  and  notes. 

Period  covered.  Parol  not  admissible  to  show  receipt  abso- 
lute on  face  is  conditional. 

Renewal  to  one  of  two  original  parties  in  a  gross  sum  destroys 
apportioned  insurance  of  first  policy. 

removal  of  property  with  consent  or  knowledge  of  agent  at 
time  of  renewal  binds  the  company  and  modifies  the  con- 
tract, §  70  a,  and  notes. 

D.     Revival : 

only  by  new  contract  or  by  estoppel,  §  70  C  ;  see  §  69  B. 
retaining  overpayment  applied  by  law  to  revive  by  estoppel,  §  70  B. 
representations  in  revival  certificate  part  of  contract,  §  70  C. 
re-delivery  of  surrendered  policy  after  agent  knows  of  loss  cannot  re- 
vive it,  §  69  B. 

115 


§  67]  INSURANCE  :   FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  V. 

S  67.  Cancellation.  —  It  need  hardly  be  said  that  when  the 
contract  has  been  once  entered  into  and  become  binding 
upon  the  parties,  it  cannot  be  cancelled  by  either,  unless 
the  ri'i-ht  be  reserved;  nor  can  either  party  withdraw  himself 
from  its  obligations  without  the  consent  of  the  other.  And 
when  the  life  of  one  is  insured  for  the  benefit  of  another,  the 
consent  of  the  beneficiary  must  be  obtained,  i  When  nego- 
tiations are  had  between  the  parties  with  reference  to  the 
abrogation  of  the  contract,  the  same  rules  apply  as  in  the 
making  the  contract.  An  agreement  to  abrogate,  cancel,  or 
rescind  can  no  more  be  made  or  executed  without  mutual 
consent  at  some  moment  of  time,  and  compliance  with  all 
the  conditions,  than  could  the  original  agreement  have  been 
made  without  that  consent.  2(«)  The  right  of  cancellation 
on  notice,  reserved  by  the  terms  of  the  policy  to  either 
party,  should  be  exercised  with  care  that  the  notice  be  ex- 
plicit, and  the  conditions  strictly  complied  with.  A  mere 
notice  of  a  desire  or  intention  to  cancel  is  not  such  an  exer- 
cise of  the  right  of  cancellation  as  will  relieve  a  company 
from  the  obligations  of  the  policy. ^     In  Atlantic  Insurance 

1  Forsyth  v.  National  Life  Ins.  Co.,  Superior  Ct.  Cook  Co.  111.,  1873  ;  Trager 
I'.  Louisiana  Eq.  Life  Ins.  Co.,  9  Ins.  L.  J.  817  ;  Marrin  v.  Stadacona  Ins.  Co., 
4  U.  C.  (App,  R.)  330 ;  Chase  v.  Ins.  Co.,  67  Me.  85.      See  §  67  C. 

2  Alliance  Mat.  Ins.  Co.  v.  Swift,  10  Cush.  (Mass.)  433  ;  Head  v.  Providence 
Ins.  Co.,  2  Cranch  (U.  S. ),  127  ;  Sands  v.  Hill,  42  Barb.  (N.  Y.)  651  ;  Fabyan  v. 
Union  Mut.  Fire  Ins.  Co.,  33  N.  H.  203  ;  Bennett  y.  City  Ins.  Co.,  115  Mass.  241  ; 
Howland  v.  Continental  Ins.  Co.,  121  Mass.  499;  Massasoit  Mills  v.  Western 
Ass.  Co.,  125  Mass.  110;  Poor  v.  Hudson  Ins.  Co.,  C.  Ct.  (N.  H. )  9  Ins.  L.  J. 
428  ;  Wilkins  v.  Tobacco  Ins.  Co.  (Ohio),  30  Ohio  St.  317. 

3  Goit  V.  National  Protection   Ins.  Co.,  25  Barb.  (N.  Y.)  189  ;  Grace  v.  Am. 

(a)  See  Bnrrus  v.  Va.  L.  Ins.  Co.,  82  ;  Von  Wien  v.  Scottish  Union  & 
124  N.  C.  9  ;  German  Ins.  Co.  v.  Rounds,  Nat'l  Ins.  Co.,  118  N,  Y.  94.  The  in- 
35  Neb.  752 ;  Penn.  Mut.  L.  Ins.  Co.  surer  may  be  estopped  to  claim  a  for- 
V.  Union  Trust  Co.,  83  Fed.  Rep.  891  ;  feiture  if  it  allows  the  policy  to  remain 
State  Mut.  F.  Ins.  Ass'n  v.  Rrinkley  uncancelled  after  notice  of  an  increase 
Stave  Co.,  61  Ark.  1  ;  Minn.  Title  Ins.  of  risk.  See  Schmurr  v.  State  Ins.  Co., 
Co.  V.  Drexel,  70  Fed.  Rep.  194  ;  Ins.  30  Oregon,  29  ;  West  End  Hotel  & 
Co.  V.  Brecheisen,  50  Ohio  St.  542  ;  Land  Co.  v.  American  F.  Ins.  Co.,  74 
Louisville  Underwriters  v.  Pence,  93  Fed.  Rep.  114  ;  Latimore  v.  Dwelling- 
Ky.  96  ;  Mut.  Benefit  L.  Ins.  Co.  v.  House  Ins.  Co.,  153  Penn.  St.  324. 
Robison,  58  Fed.  Rep.  723  ;  Joshua  The  insurer  has  the  burden  of  proof  to 
Hendy  :Machine  Works  v.  American  show  compliance  with  conditions  re- 
Steam-Boiler  Ins.  Co.,  86  Cal.  248  ;  quisite  to  cancellation.  American  F. 
Lettw.  Guardian  F.  Ins.  Co.,  125  N.  Y.  Ins.  Co.  v.  Brooks,  83  Md.  22. 

116 


CH.  v.]  TERMINATION   AND   REVIVAL.  [§67 

Company  v.  Goodall,  it  was  held  that  the  cancellation  took 
effect  in  that  particular  case  before  it  had  been  assented  to 
by  the  other  party  interested.  But  this  was  because  it  was 
agreed  between  the  parties  litigant  that,  as  between  them, 
only  one  of  whom  was  interested  in,  or  a  party  to,  the  can- 
celled contract,  the  cancellation  should  be  deemed  to  take 
effect  before  that  time.  The  insurers  under  a  new  policy 
agreed  that  a  surrender  of  the  old  policy  should  protect  the 
newly  assured  from  any  danger  by  reason  of  a  stipulation  in 
the  new  policy  that  other  insurance  not  indorsed  upon  the 
new  policy  should  render  the  new  policy  void.^  If  the  policy 
be  terminable  on  notice  merely,  for  forfeiture  for  non-pay- 
ment of  premium  or  otherwise,  the  notice  may  be  peremp- 
tory or  conditional, 2  and  even  after  a  loss.^  [By  the  law  of 
Canada,  •  where  power  is  given  to  cancel  a  policy  for  non- 
payment of  premium,  the  power  must  be  exercised  before 
tender  of  the  amount  due.^]  Where  the  policy  had  once 
taken  effect,  although  the  insured  declared  that  he  would 
have  nothing  further  to  do  with  the  insurers,  and  that  he 
abandoned  the  whole  thing,  but  still  retained  the  policy, 
while  the  insurers  retained  the  note,  and  nothing  appeared 
to  show  that  they  assented  to  the  abandonment,  the  plaintiff 
was  afterwards  allowed  to  recover.^  And  the  exercise  of  the 
right  will  also  be  confined  strictly  within  the  terms  under 
which  it  is  allowable  by  the  provisions  of  the  contract.  If 
the  contract   be  made   terminable   on  a  refusal  to  pay  an 

Central  Ins.  Co.,  C.  Ct.  (Mo.)  8  Ins.  L.  J.  95  :  Cain  v.  Lancashire  Ins.  Co.,  27 
U.  C.  (Q.  B.)  217,  453  ;  Lyman  v.  State  Mut.  Ins.  Co.,  14  Allen  (Mass.),  329; 
Peoria  Fire  &  Mar.  Ins.  Co.  v.  Botto,  47  111.  516  ;  ^tna  Ins.  Co.  v.  McGuire,  51 
111.  342;  Hathoru  v.  Germania  Ins.  Co.,  55  Barb.  (N.  Y.)  28  ;  Trager  v.  Louisi- 
ana Eq.  Life  Ins.  Co.  (La.),  9  Ins.  L.  J.  817  ;  American  Ins.  Co.  v.  Woodruff, 
34  Mich.  6 ;  Grant  v.  Reliance  Mut.  Ins.  Co.,  44  U.  C.  (Q  B.)  229  ;  Joliffe  v. 
Madison  Mut.  Ins.  Co.,  39  Wis.  111.  An  equivocal  notice,  if  accepted  and 
acted  upon  by  the  other  party,  will  be  good  against  the  party  giving  it.  Colum- 
bia Ins.  Co.  V.  Masonheimer,  76  Pa.  St.  138. 

1  35  N.  H.  328. 

2  Bergson  v.    Builders'   Ins.   Co.,  38  Cal.    541  ;  Southside   Fire   Ins.  Co.  v, 
Mueller  (Pa.),  8  Ins.  L.  J.  260. 

«  Bruce  v.  Gore  Dist.  Mut.  Ins.  Co.,  20  U.  C.  (C.  P.)  207. 
*     [Vennor  v.  L.  Ass.  of  Scot.,  30  L.  C.  Jur.  303.] 

6  McAllister,  Adm'x,  v.  New  England  Mut.  Life  Ins,  Co.,  101  Mass.  558. 

117 


§  67]  INSURANCE  :  FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  V. 

assessment  on  demand,  an  illegal  assessment,  or  one  not 
laid  according  to  the  rules  by  which  the  insurers  are  gov- 
erned is  in  point  of  law  no  assessment,  and  the  refusal,  on 
demand,  of  payment  of  such  an  assessment  gives  no  right  to 
terminate  the  contract. ^  If  the  insurance  be  terminable  "  on 
giving  notice  to  that  effect,  and  refunding  a  ratable  propor- 
tion of  the  premium,"  it  is  not  cancelled  by  a  notice  that 
the  insurers  will  cancel  the  policy  and  return  the  pro  rata 
premium,  but  will  give  the  insured  till  a  certain  day  to 
effect  insurance  elsewhere.  The  notice  should  be  that  the 
policy  is  then  and  there  cancelled,  and  the  pro  rata  pre- 
mium, sufficient  in  amount,  should  be  at  the  same  time  paid 
or  tendered  to  the  insured.  The  acceptance  of  the  return 
premium  by  the  insured,  after  such  insufficient  notice, 
might,  indeed,  cancel  the  policy ;  but  the  cancellation  must 
be  taken  to  be  as  of  the  date  of  the  payment  and  acceptance 
of  the  return  premium.  Hence,  if  a  fire  intervene  between 
the  date  of  the  notice  and  the  acceptance  of  the  return  pre- 
mium, unknown  to  the  insured,  he  will  not  lose  his  right  to 
recover  for  the  loss.  ^  (a)  Surrender  of  the  policy  before,  and 
payment  of  return  premium  after  the  loss,  neither  party  at 

1  Matter  of  People's  Mut.  Equitable  Fire  Ins.  Co.,  9  Allen  (Mass.),  319. 
See  also  post,  §  574. 

2  Van  Valkenburgh  v.  Lenox  Ins.  Co.,  51  N.  Y.  465  ;  Lyman  i'.  State  Mut. 
Fire  Ins.  Co.,  14  Allen  (Mass.),  329;  Little  v.  Eureka  Ins.  Co.,  Superior  Ct. 
(Cincinnati)  5  Ins.  L.  J.  154  ;  Peoria  Fire  &  Mar.  Ins.  Co.  v.  Botto,  47  111.  516  ; 
Planters'  Ins.  Co.  v.  Walker  Lodge  (Texas),  11  Reptr.  142. 

(a)  As  to  return  of  unearned  pre-  a  life  policy  containing  no  stipulations 
miums,  see  Manlove  v.  Com'l  Mut.  F.  as  to  return  of  premiums  does  not  en- 
Ins.  Co.,  47  Kansas,  309  ;  Phcenix  Ass.  title  the  insured  to  recover  back  the 
Co.  V.  Munger  Improved  Cotton  M.  M.  premiums  paid,  his  remedy  being  to 
Co.,  92  Texas,  297  ;  Davison  v.  London  compel  reinstatement,  or  by  an  action  for 
&  L.  K.  Ins.  Co.,  189  Penn.  St.  132;  damages,  of  which  the  measure  would  be 
Tisdell  V.  New  Hampshire  F.  Ins.  Co.,  the  cash  surrender  value  of  the  policy  ; 
155  N.  Y.  163;  Norris  v.  Hartford  F.  but  if  the  risk  had  not  attached,  such  re- 
Ins.  Co.,  55  S.  C.  450  ;  Colby  v.  Cedar  covery  can  be  had.  In  order  to  sustain 
Rapids  Ins.  Co.,  66  Iowa,  577  ;  East  an  action  for  such  return  of  premiums, 
Texas  F.  Ins.  Co.  v.  Flippin,  4  Tex.  Civ.  the  complaint  must  show  the  terms  of 
App.  576  ;  Hartford  Steam  Boiler  Insp.  the  contract,  performance  of  its  condi- 
&  Ins.  Co.  V.  Cartier,  89  Mich.  41 ;  tions,  and  a  refusal  of  the  other  party  to 
Smith  V.  National  Credit  Ins.  Co.,  65  perform.  Met'n  L.  Ins.  Co.  v.  McCor- 
Minn.  283.     A  wrongful  cancellation  of  mick,  19  Ind.  App.  49. 

118 


CH.  v.]  TEKMINATION   AND   REVIVAL.  [§  67 

the  time  knowing  of  the  loss,  does  not  cancel.^  And  where 
the  right  is  to  cancel  a  contract  within  thirty  days,  by  causing 
a  notice  to  that  effect  to  be  mailed  to  the  insured,  a  notice 
mailed  within  thirty  days,  but  not  reaching  the  insured  by 
due  course  of  mail  till  after  the  fire,  will  not  cancel  the  con- 
tract. ^  (a)  When  an  insurance  company  has  the  right  to  con 
tinue  or  cancel  the  policy  upon  certain  contingencies, they  must 
exercise  that  right  within  reasonable  time  and  before  a  loss, 
or  they  will  be  held  bound  by  the  policy. ^  And  the  neglect 
of  an  agent  of  the  insurers  charged  with  the  negotiations 
will  be  imputable  to  his  principal,  and  will  not  prejudice  the 
rights  of  the  insured  under  his  contract*  (J)  And  where  two 
parties  are  severally  interested,  notice  to  one  does  not  affect 
the  other.  ^  It  is  competent  for  the  parties  to  agree  that  a 
particular  act,  such,  for  instance,  as  the  bringing  a  suit  on 
an  overdue  note,  shall  cancel  the  policy.^  When,  after  speci- 
fying certain  cases  in  which  the  insurers  shall  have  the  right 
to  terminate  the  risk,  the  policy  adds,  "  Or  if  for  any  other 
cause  the  company  shall  so  elect,  it  shall  be  optional  with 
the  company  to  terminate  the  insurance,"  the  right  is  ab- 
solute in  the  insurers  on  performing  the  conditions,  and  is 
not  restricted  to  causes  like  those  previously  enumerated.'^ 

^  HoUingsworth  v.  Germania  Ins.  Co.,  45  Ga.  294. 

2  Tough  V.  Provincial  Ins.  Co.,  20  L.  C.  Jour.  (Q.  B.)  168  ;  Goodwin  v.  Lan- 
cashire Fire  &  Life  Ins.  Co.,  18  id.  1. 

8  Le  Soliel  v.  Delord,  Dalloz,  Jur.  Gen.,  Ct.  of  Cass.  1868,  1,  335. 

*  Franklin  Fire  Ins.  Co.  v.  Massey,  33  Pa.  St.  221  ;  Patterson  v.  Koyal  Ins. 
Co.,  14  U.  C.  (Ch.)  169.     See  also  ante,  §§  57,  64. 

5  Guggisberg  v.  Waterloo  Mut.  Ins.  Co.,  24  U.  C.  (Ch.)  350. 

6  Shakey  v.  Hawkeye  Ins.  Co.,  44  Iowa,  540. 

7  International  Ins.  Co.  v.  Franklin  Ins.  Co.,  66  N.  Y.  119. 

(a)  Notice  of  cancellation  hy  mail  is  of  a  receiver.     Ins.  Com'r  v.  People's  F. 

not  effectual  unless  received.    American  Ins.  Co.,  &?>  N.  H.  51  ;  see  Scottish  Union 

F.  Ins.  Co.  V.  Brooks,  83  Md.  22  ;  Far-  &Nat'l  Ins.Co.y.  Dangaix,  103  Ala.  388. 

num  V.  Phenix  Ins.  Co.,  83  Cal.  246.  An  agent,  who  receives  orders  to  can- 

(&)  See  British  Ins.  Co.  v.  Lambert,  eel  a  policy,  and  delays  their  execution 

26  Oregon,  109;  Royal  Ins.  Co.  v.  Clark,  until  the  property  insured  is  destroyed 

61  Minn.  476.     When  the  policy  pro-  by  tire,   is  liable   to   the  company  for 

vides  for  its  termination  at   any  time  loss  that  may  occur  in  consequence  of 

npon  the  insured's  request,  delivery  for  such    violation   of  orders.       Sun    Fire 

cancellation  to  an  agent  terminates  it  Office  v.  Ermen trout  (Penn.,  Berks.  Co.), 

immediately  ;  and  such  right  to  termin-  21  Ins.  L.  J.  1055.    See  Halsey  w.  Adams 

ate  is  not  affected  by  the  appointment  (N.  J.  L.),  43  Atl.  708. 

119 


§  67  B]         INSURANCE  :  FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  V- 

[§  67  A.  Cancellation  by  Agreement.  —  If  a  compromise  is 
made  which  involves  the  surrender  and  cancellation  of  the 
policy  as  one  of  its  terms,  the  risk  is  ended  by  the  compro- 
mise agreement,  and  the  company  is  not  liable  for  an  after 
occurring  loss.i  (a)  The  agent  notified  the  insured  that  the 
company  had  determined  to  cancel,  and  the  insured  brought 
the  policy  to  their  own  place  of  business  to  surrender  it, 
but  the  agent  failed  to  call,  so  that  it  was  not  surrendered. 
The  insured,  however,  regarding  it  as  cancelled,  began  nego- 
tiations for  other  insurance.  It  was  held  that  the  evidence 
was  sufficient  to  justify  the  finding  of  a  cancellation. 2  An 
agreement  to  receive  a  certain  sum  as  return  premium  to 
cancel  the  policy,  and  the  payment  of  the  said  sum  before 
loss  is  a  good  cancellation,  although  the  sum  agreed  on  is 
not  exactly  the  ratable  part  of  the  premium  referred  to  in 
the  policy. 3  A  receipt  signed  by  an  insured  person,  acknowl- 
edging the  cancellation  of  the  policy  (signed  under  the  mis- 
apprehension that  a  policy  in  another  company  had  been 
prepared  by  the  agent,  who  brought  the  receipt  for  signature, 
which  was  a  false  statement,  though  made  bona  fide  by  the 
agent),  does  not  estop  him  from  suing  on  the  policy  when  no 
consideration  for  the  receipt  appears.*  After  a  mutual  com- 
pany has  become,  in  fact,  insolvent,  though  perhaps  not  yet 
declared  so,  it  is  impossible  for  a  member  by  agreement 
with  the  company  to  have  his  policy  cancelled,  and  so  escape 
future  liability.^  A  member  of  a  mutual  company  stands  in 
the  position  of  a  stockholder.] 

[§  67  B.  Cancellation  by  Agent  of  Assured  ;  Agent  to  pro- 
cure Insurance  not  necessarily  Agent  to  cancel.  —  Where  W . 
insured  for  M.  several  times,  taking  out  a  new  policy  as  the 
old  one  was  cancelled,  but  finally,  after  receiving  notice  to 

1  [King  V.  Mtuii  Ins.  Co.,  36  Mo.  App.  128  ;  King  v.  Ins.  Co.,  id.  142.] 

2  [Hopkins  v.  Pbceiiix  Ins.  Co.,  19  Ins.  L.  J.  90  (Iowa),  Oct.  1889.] 
8  [i-Etna  Ins.  Co.  v.  Weissinger,  91  Ind.  297.] 

*  [Holden  V.  Putnam  F.  Ins.  Co.,  46  N.  Y.  1.] 

6  [Doane  v.  MillviUe  Mut.  Ins.  Co.,  43  N.  J.  Eq.  522.] 

(a)  See  Mutual  L.  Ins.  Co.  of  New  York  v.  Phinney,  20  Sup.  Ct.  Rep.  906  ; 
Same  v.  Sears,  id.  912. 

120 


CH.  v.]  TERMINATION   AND   REVIVAL.  [§  67  C 

cancel  a  policy,  and  doing  so,  by  returning  it  to  the  home 
office  and  receiving  the  unearned  premium  for  M.,  failed  to 
obtain  any  further  insurance,  the  facts  tended  to  show  that 
W.  was  M. 's  agent  for  cancellation,  and  should  go  to  the 
jury.i  A  partner's  assent  to  the  cancellation  of  a  firm  pol- 
icy is  conclusive  on  the  firm.^  An  agent  employed  by  a 
policy-holder  to  cancel  a  policy  cannot  keep  it  in  force  for 
his  own  benefit, 3  and  any  advantage  (as  funds  paid  on  the 
policy)  he  may  gain  by  deviating  from  the  instructions  of 
his  principal,  can  be  claimed  by  the  latter.  When  a  policy 
was  issued  at  the  instance  of  the  assured's  agent,  who,  when 
called  upon  to  pay  the  premium,  referred  the  company  to  the 
assured,  who  in  turn  declined  to  pay,  on  the  ground  that  the 
agent  must  have  paid  it ;  and  when,  the  agent  then  advised 
the  company  to  cancel  the  policy,  which  they  did,  it  was 
held  that  the  company  was  still  liable,  the  agent  having  no 
authority  to  order  a  cancellation,  and  that  the  inference  wias 
that  the  assured  had  been  given  credit  for  the  payment  of 
the  premium,  and  that  it  was  not  at  the  company's  option 
to  cancel  the  policy  or  dissolve  the  contract  without  putting 
the  plaintiff  in  mora.^  An  agency  to  procure  insurance  ends 
when  it  is  procured,  and  the  agent  cannot  afterwards  con- 
sent to  a  cancellation.^] 

[§  67  C.  Beneficiary's  Assent  necessary.  —  Where  the  life 
of  a  husband  is  insured  for  the  sole  use  of  the  wife,  payable 
to  her,  if  living,  in  thirty  days  after  proof  of  his  death,  a 
cancellation  of  the  policy  in  consequence  of  the  fraudulent 
representation  of  the  husband  that  his  wife  was  dead,  can 
have  no  effect  upon  her  rights.^  A  policy  "payable  to  F. 
L.  and  A.  L.,  mortgagees,"  though  it  may  be  defeated  by 
breach  of  conditions  by  the  insured,  cannot  be  cancelled  by 
him  without  the  consent  of  these  payees.^] 

1  [McCartney  v.  State  Ins.  Co.,  33  Mo.  App.  652.] 

2  [Hillock  V.  Traders'  Ins.  Co.,  54  Mich.  532.] 
8  [Button  V.  Willner,  52  N.  Y.  312.] 

*  [Latoix  V.  Germania  Ins.  Co.,  27  La.  An.  113.] 

5  [Insurance  Cos.  i;.  Raden,  87  Ala.  311.     See  §  67  G.] 

6  [Knapp  V.  Homeopathic  Mat.  L.  Ins.  Co.,  117  U.  S.  411,  413.] 

7  [Lattan  v.  Royal  Ins.  Co.,  45  N.  J.  453.] 

121 


§  67  G]  INSURANCE  :   FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  V. 

[§  67  D.  Notice,  Character  of  it.  —  Reasonable  notice  of 
cancellation  must  be  given  by  the  company,  and  what  is 
reasonable  is  a  question  for  the  jury.  Only  where  there  is 
fraud,  actual  or  constructive,  will  cancellation  without  notice 
be  lawful.^  To  effect  a  cancellation  the  notice  must  reach 
the  assured  in  the  shape  of  an  unconditional  demand  for 
cancellation,  not  a  mere  expression  of  desire. ^  The  right 
in  the  company  to  cancel  is  strictly  construed.  The  notice 
must  be  that  the  policy  is  cancelled,  not  will  be,  and  the 
unearned  premium  must  be  tendered.^  (a)] 

[§67  E.  Notice  to  Company's  Agent  operative  when  assured 
knows  of  it.  —  When  the  company  has  a  right  to  terminate 
the  policy  by  notice,  a  notice  sent  to  the  agent  is  effectual 
from  the  time  the  insured  knows  that  the  agent  has  received 
it,  and  a  subsequent  agreement  with  the  agent  to  continue 
the  policy  cannot  bind  the  company.*] 

[§  67  F.  To  Whom  notice  is  to  be  Given.  —  The  notice 
must  be  given  to  assured  or  his  authorized  agent. ^  Finding 
the  notice  of  cancellation  among  the  papers  of  the  insured 
after  death,  the  fire  having  occurred  in  his  life,  is  not  suffi- 
cient proof  of  service  for  cancellation  before  loss.^  Notice 
of  cancellation  given  to  the  general  agent  of  the  insured  is 
sufficient  When  one  person  is  at  the  same  time  an  agent 
for  the  assured  and  for  the  insurer,  notice  of  cancellation  of 
the  policy  to  him  will  be  notice  to  the  policy-holder.^] 

[§  67  G.  Notice  to  Procuring  Agent  not  sufficient.  —  A  pol- 
icy cannot  be  terminated  by  notice  to  a  special  agent  who 

1  [Chadbourne  v.  Germ.  Amer.  Ins.  Co.,  31  Fed.  Rep.  533,  24  Blatch.  492 
(N.  Y.)  1887.] 

2  [Petersliurg  Savgs.  &  Ins.  Co.  v.  Manhattan  F.  Ins.  Co.,  66  Ga.  446.] 
8  [Planters'  Ins.  Co.  v.  Walker  Lod^e  No.  19,  1  Tex.  Civ.  Cas.  §  758.] 
*  [Springfield  F.  &  M.  Ins.  Co.  v.  McKinnon  &  Call,  59  Tex.  507.] 

»  [Von  Wein  v.  Scottish,  &c.  Ins.  Co.,  52  N.  Y.  Super.  490  ;  54  N.  Y.  Super. 
276  ;  Lancashire  Ins.  Co.  v.  Nill,  114  Pa.  St.  248.] 

6  [Lattan  v  Royal  Ins.  Co.,  45  N.  J.  453.] 

T  [Stone  V.  Franklin  F.  Ins.  Co.,  105  N.  Y.  543.] 

8  [Hartford  Ins.  Co.  v.  Reynolds,  36  Mich.  502,  507  ;  Newark  Ins.  Co.  v. 
Sammons,  11  111.  Ap.  230,  237.] 

(a)  A  notice  to  the  insured,  directing  clause  in  the  policy,  is  not  a  notice  of 
attentif^n  to  the  effect  of  failure  to  pay  cancellation  within  the  policy.  Savage 
the  premium,  and  to  the  cancellation    v.  Phoenix  Ins.  Co.,   12  Mont.  458. 

122 


CH.  v.]  TEEMINATION   AND   REVIVAL.  [§  67  H 

was  entrusted  only  with  authority  to  procure  insurance  for 
the  plaintiff.  i(«)  Where  a  policy  provides  for  its  own  ter- 
mination by  notice  and  refunding  a  ratable  part  of  the  pre- 
mium, and  declares  that  the  person  procuring  the  insurance 
shall  be  deemed  the  agent  of  the  assured,  and  not  of  the  in- 
surers, "under  any  circumstances  whatever,  or  in  any  trans- 
actions relating  to  this  insurance,"  yet  notice  of  termination 
to  the  person  procuring  the  insurance  is  not  notice  to  the 
insured.  And  parol  evidence  of  a  custom  of  insurance  men 
to  give  such  notice  to  such  person  cannot  be  received  to  vary 
the  terms  of  the  contract. ^  One  who  was  agent  to  procure 
insurance  is  not  necessarily  authorized  to  receive  notice  of 
cancellation.  3  Even  though  the  policy  provides  that  notice 
of  cancellation  may  be  given  to  the  person  who  procured 
the  insurance,  the  provision  will  not  apply  where  the  same 
person  acted  for  both  parties  in  procuring  and  issuing  the 
policy.'^] 

[§  67  H.  A  broker  employed  to  procure  insurance  has 
no  authority  to  give  or  receive  notice  of  cancellation. 
When  he  procures  the  insurance  his  agency  ends.^  The 
employment    of    a    broker    to    effect    insurance    does    not 

1  [Hermann  v.  Niagara  F.  Ins.  Co.,  100  N.  Y.  411.] 

2  [Grace  v.  Amer.  Cent.  Ins.  Co.,  109  U.  S.  278,  283.] 

3  [Body  V.  Hartford  F.  Ins.  Co.,  63  Wis.  157  ;  Broadwater  v.  Lion  F.  Ins.  Co., 
34  Minn.  466.] 

*  [Insurance  Cos.  v.  Raden,  87  Ala.  311.] 

8  [Von  Weiu  v.  Scottish,  &c.  Ins.  Co.,  52  N.  Y.  Super.  490.] 

(a)  See  Karelsen  v.  Sun  Fire  Office,  of  the  insured  to  receive  notice  of  can- 
122  N.  Y.  545;  Quong  Tue  Sing  v.  cellation.  A  tender  of  premimn  to  the 
Anglo-Nevada  Ass.  Corp.,  86  Cal.  566  ;  agent,  and  his  advice  to  let  the  matter 
Sun  Fire  Office  f.  Ermentrout  (Penn.),  restuntilthecompany  decides  about  can- 
21  Ins.  L.  J.  1055  ;  British-America  celling,  amount  to  an  indefinite  extension 
Ass.  Co.  V.  Cooper,  6  Col.  App.  25  ;  of  time,  and  a  waiver  of  non-payment. 
White  V.  Ins.  Co.  of  New  York,  93  Fed.  Mallovy  v.  Ohio  Farmers'  Iiis.  Co., 
Eep.  161 ;  Arnfeld  v.  Guardian  Ass.  90  Mich.  112.  Where  the  policy  pro- 
Co.,  172  Penn.  St.  605  ;  Buick  v.  vided  that  it  might  be  terminated  by 
Mechanics'  Ins.  Co.,  103  Mich.  75  ;  notice  to  the  insured  or  his  representa- 
Scott  V.  Sun  Fire  Office,  133  Penn.  St.  tives,  notice  of  cancellation  served  on 
322  ;  East  Texas  F.  Ins.  Co.  v.  Blum,  the  brokers  who  procured  the  insurance, 
76  Texas,  653.  A  surrender  of  the  where  the  residence  of  the  principal  was 
policy  to  the  agent  to  replace  in  case  of  unknown,  was  held  sufficient,  in  Royal 
cancellation  does  not  make  him  the  agent  Ins.  Co.  v.  Wight,  55  Fed.  Piep.  455. 

123 


§  67  K]  INSUKANCE :   FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  V. 

make  liim  the  agent  of  the  assured  to  receive  notice  of 
cancellation,  ^(a)] 

[§  67  I.  Evidence  of  a  general  custom  of  the  fire  insurance 
business,  making  notice  of  cancellation  to  the  broker  em- 
ployed by  the  insured  to  procure  the  policy  a  sufficient  notice 
to  the  insured,  is  inadmissible. 2  In  Illinois  it  is  held 
that  where  the  policy  provides  that  a  broker  effecting  insur- 
ance shall  be  deemed  the  agent  of  the  insured,  notice  to  the 
broker  to  cancel  the  policy  is  notice  to  the  assureld.^] 

[§  67  J.  Return  of  Premium.  — If  a  policy  provides  for  its 
termination  by  giving  notice  and  refunding  a  ratable  pro- 
portion of  the  premium,  a  notice  of  the  company's  wish  to 
cancel  and  a  request  to  return  the  policy  upon  which  the 
premium  would  be  remitted  is  not  sufficient.  Nothing  short 
of  notice  and  actual  tender  of  the  premium  will  do.*  It 
has  been  held  that  the  exclusion  of  evidence  with  reference 
to  what  was  done  about  cancelling  a  policy  where  the  pre- 
mium was  not  returned  until  the  loss  actually  occurred,  was 
proper.^  Repayment,  or  tender  of  the  ratable  proportion  of 
the  premium,  or  waiver  of  it,  is  necessary  to  cancel  the 
policy,  as  well  as  notice,  and  a  credit  given  the  assured  on 
a  debt  due  from  him,  that  credit  not  being  assented  to  by 
him,   is  insufficient.^] 

[§  67  K.  When  no  Return  of  Premium  is  necessary.  —  But 
where  no  premium  has  actually  been  paid,  a  charge  on 
account  being  all  that  has  transpired  in  that  matter,  notice 
alone  without  tender  of  premium  is  sufficient  to  cancel  the 

1  [Adania  v.  Manufacturers',  &c.  F.  Ins.  Co.,  17  Fed.  Rep.  630,  R.  I.  1883. 
Kehler  v.  New  Or  Ins.  Co.,  23  Fed.  Rep.  709  Mo.  1885  ;  Ind.  Ins.  Co.  v.  Hart- 
well,  100  Ind.  566.  This  case  follows  109  U.  S.  278,  in  ruling  that  a  broker 
"  employed  to  procure  insurance "  is  not  the  agent  of  the  assured  after  the 
procurement  is  complete,  for  receiving  notice  of  cancellation,  or  anything  else, 
even  though  the  policy  declares  that  the  broker  shall  be  deemed  the  agent  of 
the  assured  for  matters  connected  with  the  insurance.] 

'^  [Grace  v.  American  Central  Ins.  Co.,  109  U.  S.  278.] 

8  [Newark  F.  Ins.  Co.  v.  Sammons,  11  Brad.  230  ;  contra,  100  Ind.  566,  and 
109  U.  S.  278  supra.] 

*  [Oriffey  v.  N.  Y.  Central  Ins.  Co.,  100  N.  Y.  417.] 

5  [McGraw  v.  Germania  F.  Ins.  Co.,  54  Mich.  146.] 

6  Lattan  v.  Royal  Ins.  Co.,  45  N.  J.  453.] 

(a)  Such  authority  may  be  inferred  White  v.  Ins.  Co.  of  New  York,  93  Fed, 
from  their  yirevious  course  of  dealing.    Kep.  161. 

124 


CH.  v.]  TERMINATION    AND   REVIVAL.  [§  67  L 

policy.^  If  a  note  has  been  given  for  the  premium,  the  pro 
rata  amount  to  be  returned  in  case  of  cancellation  need  not 
be  tendered;  the  note  is  subject  to  that  credit.^  When 
credit  in  any  shape  has  been  given  for  the  premium  the 
company  does  not  have  to  return  anything  upon  cancella- 
tion.^ And  tender  of  the  unearned  premium  is  unnecessary 
to  complete  a  cancellation  if  the  minds  of  the  parties  have 
met  on  a  rescission.*] 

[§  67  L.  The  Company  versus  its  Agent.  —  When  a  com- 
pany intrusts  to  its  agent  the  duty  of  cancellation  of  a  spe- 
cific policy,  without  definite  instructions  as  to  time  to  be 
allowed,  nothing  short  of  abuse  of  discretion  or  fraud  on 
the  part  of  the  agent  relieves  the  principal  from  liability 
before  actual  cancellation.  The  insured  is  entitled  to  rea- 
sonable notice  of  intent  to  cancel,  and  if  the  company  does 
not  prescribe  the  time  within  which  the  cancellation  shall 
be  completed,  nothing  but  an  absolute  abuse  of  the  discre- 
tion so  left  to  the  agent,  or  fraud  on  his  part,  will  relieve 
the  principal.^  (a)  In  this  case  the  agent  receiving  the  pol- 
icy from  the  office  with  instructions  to  cancel  gave  the  appli- 
cant three  days  to  get  other  insurance,  and  a  fire  occurring 
within  the  three  days  the  company  was  held.  But  unreason- 
able delay  in  communicating  with  the  assured  will  make  the 
agent  responsible,  as  where  an  agent  could  have  notified  the 
insured  that  his  policy  was  cancelled  within  half  an  hour 
after  receiving  word  to  that  effect  from  the  company,  but 
delayed  till  the  property  was  burned  five  days  afterward,  the 
finding  of  negligence  on  the  part  of  the  agent  in  a  suit 
against  him  by  the  company  was  held  proper.^  Agents  of 
an  insurance  company  cannot  delegate  the  discretion  of  can- 

1  [Stone  V.  Franklin  F.  Ins.  Co.,  105  N.  Y.  543.] 

2  [Little  V.  InsTirance  Co.,  38  Ohio  St.  110.] 

Von  Wein  v.  Scottish,  &o.  Ins.  Co.,  52  N.  Y.  Super.  490.] 
Hillock  V.  Traders'  Ins.  Co.,  54  Mich.  531.] 

5  [McLean  v.  Republic  Ins.  Co.,  3  Lansing,  421.] 

6  [Phcenix  Ins.  Co.  v.  Fris.sell,  142  Mass.  513.] 

(«)  Instructions  to  the  agent  to  can-    Watertown  Fire  Ins.  Co.  v.  Rust,  141 
eel,  in  the  absence  of  knowledge  by  the    111.  85* 
insured,   does    not    affect    the    latter. 

125 


i- 


§  68]  INSURANCE  :  FIRE,  LIFE,   ACCIDENT,    ETC.  [CH.  V. 

celling  a  policy,  but  it  is  not  necessary  that  they  should  per- 
sonalfy  give  notice  or  tender  the  return  premium,  i  If  a 
company  orders  its  agent  to  cancel  a  policy  and  by  his 
neglect  or  disobedience  it  suffers  loss,  he  is  liable,^  and  can- 
not shield  himself  by  showing  that  he  had  directed  the 
broker  who  placed  the  insurance  with  him  to  cancel  the 
policy.  Evidence  of  a  custom  to  procure  cancellation  in 
this  way  is  inadmissible  in  the  agent's  defence.^  (a)  It 
seems  that  on  the  cancellation  of  a  policy  the  agent  is  only 
entitled  to  commissions  on  the  premiums  earned  before 
cancellation.^  (b)] 

[§  67  M.  Cancellation  of  Void  Policy  in  Equity.  —  When 
the  policy  is  void  for  lack  of  interest  in  the  assured,^  or  for 
fraud  in  effecting  it,^{c)  equity  will  order  a  cancellation  of 
it.  The  fact  that  the  insured  has  become  intemperate  will 
not  induce  equity  to  cancel  the  policy,  for  he  may  reform-^] 

§  68.  Cancellation ;  Notice.  —  If  the  policy  provide  the 
length  of  the  notice  to  be  given,  it  does  not  seem  to  be 
material  that  the  notice  itself  makes  a  mistake  in  the  desig- 

1  [Runkle  v.  Citizens'  Ins.  Co.,  6  Fed.  Rep.  143  (Ohio),  1881.] 

2  [Washington  F.  &  M.  Ins.  Co.  v.  Chesebro,  35  Fed.  Rep.  477  (Conn.),  1887.] 
8  [Franklin  Ins.  Co.  v.  Sears,  21  Fed.  Rep.  290  (Ohio),  1884.] 

*  [Devereux  v.  Insurance  Co.,  98  N.  C.  6.] 

6  [Goddart  v.  Garrett,  2  Vern.  269.] 

6  [Fenn  v.  Craig,  3  H.  C.  216,  222.] 

T  [Connecticut  Mut.  L.  Ins.  Co.  v.  Bear,  26  Fed.  Rep.  582  (N.  C),  1886.] 

(a)  A  local  custom  that  insurance  Hamilton,  50  Neb.  248  ;  Kooistra  v. 
agents,  after  the  termination  of  their  Rockford  Ins.  Co.  (Mich.),  81  N.  W. 
agency,  may  cancel  any  of  the  policies    568. 

issued  through  them,   is  unreasonable,  (c)   See  Swain  v.  Security  Live-Stock 

contrary  to  the  rules  of  law  applicable  to  Ins.  Co.,  165  Mass.  3-21.     The  cancella- 

principal  and  agent,  and  is  void.     Mer-  tion  of  a  policy  may  also  be  set  aside 

chants'  Ins.  Co.  v.  Prince,  50  Minn.  50.  when  made   under  a  mistake  of  fact. 

(b)  The  compensation  of  agents  is  Duncan  v.  New  York  Mut.  Ins.  Co., 
determined  by  their  contracts,  express  138  N.  Y.  88.  Where  prior  insurance 
or  implied  ;  the  general  course  of  busi-  on  the  property  had  been  cancelled  be- 
ness  is  evidence,  and  the  fact  that  full  cause  the  insurer  was  retiring  from 
premiums,  less  commissions,  have  been  business,  and  the  apjdication  denied 
allowed  on  cancelled  policies  in  some  prior  refusal  or  cancellation  of  a  policy, 
circumstances,  as  a  matter  of  expediency,  this  was  held  not  to  be  a  material  mis- 
does  not  establish  such  allowance  as  a  representation,  as  the  cancellation  was 
matter  of  law,  Ins.  Com'r  v.  People's  not  for  a  cause  affecting  the  risk. 
Fire  Ins.  Co.,  68  N.  H.  51.  See  also  Hawley  v.  Liverpool,  &c.  Ins.  Co.,  102 
on   this  section,    Northern  Ass.  Co.  v.  Cal.  651. 

126 


CH.  v.]  TERMINATION   AND   REVIVAL.  [§  69 

nation  of  the  date  when  the  policy  will  become  cancelled, 
provided  the  required  time  shall  have  elapsed  between  the 
time  when  the  notice  is  given  and  loss  shall  have  happened. 
Thus,  where  it  was  provided  that  after  seven  days'  notice  of 
intention  to  cancel,  the  insurance  should  terminate,  a  notice 
dated  the  13th  of  February,  and  deposited  on  that  day  in  the 
post-office,  but  not  till  after  the  office  was  closed  for  the  day, 
which  notice  was  received  by  the  insured  on  the  next  day 
in  due  course  of  mail,  and  informed  him  that  his  insurance 
would  terminate  on  the  20th,  the  loss  not  having  occurred 
till  the  22d,  it  was  held  that  the  notice  was  sufficient  both 
within  the  letter  and  the  spirit  of  the  contract. ^  But  this 
case  is  a  departure  from  the  usual  strictness. 

§  69.  Cancellation ;  Intermediary  Receipt.  —  So,  toO,  a  con- 
tract of  insurance  made  by  what  is  sometimes  called  an  in- 
termediary receipt  given  by  an  agent,  that  is,  a  receipt  for 
the  premium,  containing  a  statement  that  the  receipt  is  sub- 
ject to  the  approval  of  the  insurers,  to  be  notified  to  the  in- 
sured, and  certifying  that  meanwhile  the  applicant  is  insured 
for  a  specified  time,  may  be  cancelled  within  the  time  speci- 
fied, and  at  any  period  prior  to  that  time,  if  notice  of  disap- 
proval be  given.  In  other  words,  the  certificate  of  insurance 
for  a  specified  time  pending  the  negotiation  for  a  policy  does 
not  constitute  an  absolute  contract  for  that  time,  but  only  a 
conditional  contract  that  the  insurance  shall  extend  for  the 
specified  time,  unless  the  insurers,  having  the  option  to  de- 
cline the  risk,  shall  sooner  signify  their  determination  to 
decline.^  Here,  however,  as  in  other  cases,  the  right  to 
cancel  will  be  strictly  construed,^  and  notice  and  an  offer 
to  refund  must  be  previously  given,  if  required.*  [Although 
by  payment  of  the  premium,  <fec.,  a  provisional  contract  may 
be  created,  yet  the  company  may  reject  the  application  and 
annul  the  contract,   and    it  will    not  be  held,  because   the 

1  Emmott  V.  Slater  Mut.  Fire  Ins.  Co.,  7  R.  I.  562. 

2  Goodfellow  V.  Times  &  Beacon  Ass.  Co.,  17  U.  C.  (Q.  B.)  411, 

8  [When  the  policy  prescribes  the  conditions  on  which  cancellation  by  the 
company  can  be  made,  they  must  be  strictly  complied  with  or  the  company  will 
be  liable.     Landis  v.  Home  Mut.  F.  &  M.  Ins.  Co.,  56  Mo.  591,  598.] 

*  Grant  i;.  Reliance  Mut.  Fire  Ins.  Co.,  U  U.  C.  (Q.  B.)  229. 

127 


§  69  B]  INSURANCE  :  FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  V. 

ao-ent,  by  arrangement  with  'the  assured,  retained  the  pre- 
mium while  attempting  to  get  the  company  to  reconsider  its 
rejection.!  Where  a  policy,  duly  signed,  was  given  A.  by 
the  company's  duly  authorized  agent,  the  company  was 
liable,  although  immediately  after  the  delivery  of  the  policy 
the  agent  got  A.  to  sign  a  formal  application  containing  a 
memorandum  stating  that  the  policy  was  not  to  go  into 
effect  until  approved  by  the  general  agent,  who  subsequently 
gave  the  local  agent  notice  to  cancel  the  policy,  which, 
however,  was  not  done  before  loss.  The  effect  of  the  mem- 
orandum could  be  no  more  than  to  reserve  a  right  of  can- 
cellation, and  until  the  policy  was  actually  cancelled  the 
company  would  be  held.^] 

§  69  a.  Surrender ;  Paid-up  Policy.  —  Not  SO  much  strict- 
ness seems  to  be  required  on  the  surrender  of  one  policy  in 
order  to  obtain  another.  Here  a  desire  expressed  within  the 
term,  to  which  no  dissent  is  expressed,  and  a  completion  of 
the  requisite  acts,  delivery  of  the  old  policy,  &c.,  after  the 
expiration  of  the  term,  were  held  sufficient  in  equity.  ^  (a) 

[§  69  B.    An  agreement  in  good  faith  between  the  parties 

1  [Otterbein  v.  Iowa  Ins.  Co.,  57  Iowa,  274,] 

2  Insurance  Co.  v.  "Webster,  6  Wall.  129.] 

*  Morrison  v.  American  Popular  Life  Ins,  Co.,  C.  Ct.  (N.  H, )  5  Ins.  L,  J. 
752.  See  also  Farmers'  Mut.  Ins.  Co.  v.  Wenger  (Pa.),  8  Ins.  L.  J.  712;  Train 
V.  Holland,  &c.  Ins.  Co.,  68  N.  Y.  208.  As  to  policies  for  a  term  of  years,  void 
or  voidable  for  non-payment  of  annual  premium,  see  •post,  §  342. 

(a)    As  to  surrender  to  obtain  a  new  failure  to  apply  and  surrender  the  policy 

policy,    usually    to    obtain    a    paid-up  within  the  period  stipulated,  the  assured 

liolicy,  see  Heinlein  v.  Imperial  L.  Ins.  does  not  lose   his   right   to   a   paid-up 

Co.,  101   Mich.    250  ;  Terry  v.  Mutual  policy  ;    nor  need  a   policy  which  has 

L.  Ins.  Co,,  116  Ala.  242  ;  McLaughlin  lapsed  be  surrendered  in  order  to  a  right 

V.  Equitable  L.  Ass.   Society,  38  Neb.  of  action.     Mutual  Life  Ins.  Co.  v.  Jar. 

725  ;  Manton  v.  Robinson,  19  R.  I.  405  ;  boe   (Ky.),  42  S.  W.  1097.     As  to  sur- 

Riegel    v.   American    L,    Ins.    Co.,  158  render  under  the  Ux  loci,  see  Equitable 

Penn.  St.  134  ;   Crown  Point   Iron  Co,  L.  Ass,  Society  v.  Clements,  140  U.  S. 

V.    iEtna    Ins,    Co.,    127    N,    Y,    608;  226, 

North-Western    Mut.    L.    Ins,   Co,    v.        Surrender  value  in  a  mutual  company, 

Barbour  (Ky.),  15  L.  R.  Ann,  449,  and  when  allowed  by  a  policy,  is  determined 

note.     If  a  policy  stipulates  for  a  paid-  by  deducting  the  amount  due  on  the 

up  policy  after  certain  payments  have  notes  from  what  has  been  paid   in  cash, 

been  made,  provided  the  policy  be  sur-  Hines  v.  Mutual   L.  Ins.  Co.  (Kv.),  25 

rendered  within  a  stated  time,  and  such  Ins.  L.  J.  555  ;  see  Hazen  v.  Mass.  Mut. 

payments  have  been  fully  made  in  cash,  L.  Ins.  Co.,  170  Mass.  254  ;  Kellner  v, 

time  is  not  of  the   essence,   and  by  a  Mutual  L.  Ins.  Co.,  43  Fed.  Rep.  623. 
123 


CH.  v.]  TERMINATION   AND  REVIVAL.  [§  70 

to  a  policy  to  annul  it  is  valid,  and  when  the  insured  sur- 
renders his  policy  and  it  is  agreed  that  it  shall  be  cancelled, 
the  insured  ceases  to  be  a  member,  and  is  not  liable  for  sub- 
sequent assessments.!  If  the  policy  permits  the  assured  to 
cancel,  a  delivery  of  the  policy  to  an  agent  authorized  to 
cancel  policies,  with  the  statement  that  the  surrender  is 
made  for  cancellation,  terminates  the  policy,  and  a  subse- 
quent redelivery  by  the  agent  with  knowledge  of  an  inter- 
vening loss  will  not  revive  it.^  Where  a  policy  was  delivered 
up  to  be  cancelled  on  condition  that  the  risk  be  placed  in  an- 
other company,  and  a  loss  occurred  after  the  agent  had  writ- 
ten "cancelled"  across  the  old  policy,  but  before  the  new 
policy  had  been  applied  for,  it  was  held  that  the  company 
was  liable,  as  the  condition  on  which  the  cancellation  was 
to  be  made  had  not  been  fulfilled.  3  If  a  policy  under  which 
the  assured  may  cancel  is  not  tendered  for  cancellation  until 
after  it  has  been  forfeited  by  other  insurance,  the  unearned 
premiums  cannot  be  recovered,  for  the  policy  and  all  its 
terms  were  dead  in  law  before  the  tender.*  The  assent  of 
a  partner  to  receive  an  offered  substitution  of  a  policy  in 
another  company  will  bind  the  substituted  company  to  the 
firm,  though  loss  occurs  before  the  old  policy  is  surrendered 
or  the  new  one  delivered.^] 

§  70.  Accident  Insurance ;  Insurance  Ticket.  —  In  SOme 
branches  of  accident  insurance  —  railway  passengers,  for  in- 
stance—  it  is  the  practice  to  issue  tickets,  the  nature  of  the 
business  being  such  that  there  is  not  the  time  to  follow  the 
routine  usual  in  other  kinds  of  insurance.     These  tickets^ 

1  [Akers  v.  Hite,  94  Pa.  St.  394.] 

2  [Crown  Point  Iron  Co.  v.  yEtua  Ins.  Co.,  53  Hun,  220.] 

8  [Poor  V.  Hudson  Ins.  Co.,  2  Fed.  Rep.  432  ;  9  Ins.  L.  J.  428  ;  (N.  H.),  1880.] 
*  [Colby  V.  Cedar  Rapids  Ins.  Co.,  66  Iowa,  577.] 

5  [Whiteman  Bros.  v.  Anier.  Cent.  Ins.  Co.,  14  Lea  (Tenn.),  327.] 

6  The  following  is  a  sample  of  such  tickets,   styled  a  "General   Accident 

Ticket:"    "The company  of will    pay  the    owner    of    this  ticket 

dollars  per  week  in  case  of  personal  injuiy  causing  total  disability,  for  a  period 

not  exceeding weeks,  or  the  sum  of dollars  to  his  legal  representatives 

in  the  event  of  his  death,   from    personal    injury,    ensuing  within months 

from  the  happening  thereof,  when  caused  by  any  accident  while  travelling  by 
public  or  private  conveyance,  provided  for  the  transportation  of  passengers  in 
the ,  it  being  understood  that  the  policy  covers  no  description  of  war  risk." 

VOL.  I.  — 9  129 


§  70  a]       INSURANCE :  fiee,  life,  accident,  etc.  [ch.  v. 

are  made  out  and  signed  at  the  company's  office,  and  trans- 
mitted to  their  agents  to  be  sold  indifferently  to  all  who 
apply  for  them.  The  sale  and  delivery  by  an  agent,  or  by 
any  one  in  his  employ,  and  the  payment  of  the  price,  give 
the  owner  a  valid  claim  against  the  company,  subject  to  the 
conditions  set  forth  in  the  ticket.  ^ 

§  70  a.  Renewals.  Removals.  —  As  to  the  effect  of  a  re- 
newal of  a  policy  there  is  some  confusion,  if  not  disagree- 
ment, amongst  the  authorities.  It  is  generally  held  to  be  a 
new  contract,  upon  the  terms  and  conditions  stated  in  the 
policy  expired,  — the  old  application,  in  the  absence  of  evi- 
dence to  the  contrary,  serving  as  the  basis  of  the  new  con- 
tract, and  as  if  made  at  the  date  of  the  renewal.  2  («)  But 
the  renewal  may  be  upon  different  interests,  or  interests 
held  in  different  rights  and  by  different  parties,  or  in  other 
ways  the  contract  may  be  changed  by  the  circumstances. 
In  such  cases  the  old  contract  must  necessarily  be  modified, 
though  the  conditions  may  remain  the.same.^  Consent  to 
the  removal  of  property  already  insured  to  another  locality, 
where  it  is  to  continue  insured,  is  also  a  new  contract.*     [A 

1  Bro-wn  v.  Railway  Passenger  Ass.  Co.,  45  Mo.  221. 

2  Peacock  v.  New  York  Life  Ins.  Co.,  1  Bosw.  (N.  Y.)  338  ;  affirmed,  20  N.  Y. 
293;  Martin  v.  Home  Ins.  Co.,  20  U.  C.  (C.  P.)  447  ;  Hartford  Fire  Ins.  Co.  v. 
Walsh,  54  111.  164 ;  Brady  v.  North  "Western  Ins.  Co.,  11  Mich.  425 ;  Post  v. 
iEtna  Ins.  Co.,  43  Barb.  (N.  Y.)  351.  See  also  post,  §  190.  [The  renewal  of  a 
policy  without  any  new  application  stands  upon  the  same  grounds  as  the  ori- 
ginal.    Witherell  v.  Maine  Ins.  Co.,  49  Me.  200,  203.] 

3  Phelps  V.  Gebhard  Fire  Ins.  Co.,  9  Bosw.  (N.  Y.)  404,  409 ;  Lancey  v.  Phce- 
nix  Fire  Ins.  Co.,  56  Me.  562  ;  Luciani  v.  Am.  Fire  Ins.  Co.,  2  Whart.  (Pa.)  167  ; 
Peoria  Mar.  &  Fire  Ins.  Co.  v.  Hervey,  34  111.  46.     See  also  post,  §  190. 

*  Kathbone  v.  City  Fire  Ins.  Co.,  31  Conn.  193  ;  Kunzze  v.  Am.  Exch.  Fire 
Ins.  Co.,  41  N.  Y.  412. 

(a)   See  "Walker  ?;.  American  Central  years,  for  a  different  amount  and  period, 

Ins.  Co.,  143  N.  Y.  167;  Dover  Glass  in  another  company,  it  was  held  that 

Works   Co.   V.    American   F.    In.s.  Co.,  such  claim  could  not  be  allowed,  nor  could 

1    Marvel    (Del.)    32  ;     Bole    v.    New  the  application  be  admitted  as  evidence. 

Hampshire  F.  Ins.  Co.,  159  Penn.  St.  Sun  Mutual  Ins.  Co.  v.  Crist  (Ky.),  26 

53.     See  Jones  v.  New  York  L.  Ins.  Co.,  Ins.  L.  J.  695.     And  although  a  verbal 

168   Mass.   245  ;    Phoenix   Ins.  Co.    v.  renewal  is  valid,  5'et  such  parol  agree- 

Ward  (Tex.  Civ.  App.),  28  Ins.  L.  J.  ment  is  not  binding  if  it  does  not  fix  the 

702.     Where  it  was  claimed  that   the  amount   of    the    insurance.      Sater    v. 

insurance  was  a  renewal  of  a  previous  Henry  County   Farmers'  Ins.    Co.,   92 

policy  under  an    application    for    two  Iowa,  579. 

130 


CH.  v.]  TERMINATION    AND    REVIVAL.  [§  70  B 

change  of  location  of  the  goods  or  other  alteration  known  to 
the  agent  at  the  time  of  renewal,  binds  the  company,  and 
the  description  of  position  in  the  original  contract  is  no 
longer  operative.  It  will  be  presumed  that  the  company  in- 
tended to  modify  the  original  agreement  so  as  'to  make  it 
cover  the  goods  where  it  knew  they  were,  and  not  to  impose 
on  the  assured  by  inducing  him  to  believe  that  his  property 
was  insured,  when  in  fact  it  was  not.^  A  renewal  receipt 
given  June  19,  1878,  for  one  year,  to  wit,  from  June  10  (the 
time  the  original  policy  expired)  to  June  10,  1879,  does  not 
cover  a  loss  occurring  June  16,  1879. ^  Parol  is  inadmis- 
sible to  show  that  a  renewal  receipt  absolute  on  its  face  was 
a  conditional  contract.  ^  A  policy  running  to  two  persons 
may  be  renewed  to  one  of  them  where  the  whole  interest  has 
centred  in  that  one.''  Where  a  policy  for  81,800  on  a  mill 
and  f700  on  the  machinery  was  renewed  in  general  terms 
for  $2,500,  it  was  held  that  the  intent  was  not  to  distribute 
the  risk  thereafter,  ^j 

[§  70  B,  What  constitutes  a  Good  Renewal.  —  A  parol 
agreement  for  renewal  fixing  all  terms,  and  nothing  remain- 
ing to  be  done  except  making  a  renewal  receipt  and  payment 
of  the  premium,  binds  the  company.^  In  a  prior  case^  a 
renewal  was  held  insufficient  though  all  the  terms  were 
ag;reed  on  and  the  agent  said  he  would  make  the  renewal, 
but  neglected  to  do  so.  In  58  Wis.  the  court  distinguished 
the  early  case  by  remarking  that  the  suit  there  ivas  on  the 
old  policy^  while  in  the  case  before  it,  the  action  was  on  the 
parol  agreement  to  renew,  which  was  as  certainly  sustain- 
able as  the  other  form  of  suit  would  not  be.  A  policy  may 
be  renewed  by  parol, ^  even  though  it  stipulates  that  it  shall 
not  be.  9     But  a  policy  under  seal  cannot  be  continued  from 

1  [Ludwig  V.  Jersey  City  Ins.  Co.,  48  N".  Y.  379.  ] 

2  [Fuchs  V.  Germatitown  F.  M.  Ins.  Co.,  60  Wis.  286.] 

3  [Baura  V.  Parkhurst,  26  Brad.  127.] 

4  [Lockwood  t'.  Middlesex  Mut.  Ass.  Co.,  47  Conn.  553.] 
6  [Driggs  V.  Albany  Ins.  Co.,  10  Barb.  440,  444.] 

6  [King  y.  Hekla  F.  Ins.  Co.,  58  Wis.  508.] 
T  [Taylor  v.  Phoenix  Ins.  Co.,  47  Wis.  365.] 

8  [Ludwig  V.  .lersey  City  Ins.  Co.,  48  N.  Y.  379.] 

9  [Cohen  D.  Ins.  Co.,  67  Tex.  325.] 

131 


§  70  B]  INSURANCE  :    FIRE,    LIFE,    ACCIDENT,    ETC.  [CH.  V. 

year  to  year  by  a  mere  parol  contract  such  as  a  renewal 
receipt  not  under  seal,  such  receipts,  however,  evidence  new 
parol  contracts  under  conditions  the  same  as  in  the  policy. ^ 
In  Georgia  a  suit  on  a  parol  renewal  of  a  policy  is  demur- 
rable. ^  A  naked  oral  promise  of  an  insurance  company's 
agent  to  renew  a  policy  when  it  runs  out,  is  not  actionable 
on  the  agent's  failure  to  do  so.^  {a)  It  must  be  alleged  that 
the  premium  was  paid  or  tendered  at  the  time  the  old  policy 
expired.  If  this  is  done,  however,  damages  may  be  recov 
ered  for  failure  to  renew  in  accordance  with  an  oral  promise. 
Where  A.  told  the  agent  of  several  companies  in  which  he 
had  policies,  that  he  wished  insurance  for  the  coming  year 
in  a  certain  amount,  and  by  mistake  the  agent  only  renewed 
policies  enough  to  give  him  half  what  he  wanted,  no  claim 
could  be  made  on  the  companies  whose  policies  were  not 
renewed.  A  contract  for  renewal  must  be  complete,  and  if 
anything  is  left  to  be  determined,  as  in  this  case,  it  is  not 
so.*  A  conversation  with  the  agent  requesting  him  to  re- 
new, and  a  promise  on  his  part  to  renew  the  policy,  do  not 
constitute  a  renewal  where  no  renewal  receipt  is  given,  no 
renewal  endorsed  on  the  policy  or  entered  by  the  agent,  or 
notified  to  the  company,  and  no  premium  paid,  tendered,  or 
credit  arranged.^  (&)     The  policy  in  this  case  provided  for 

1  [Firemen's  Ins.  Co.  v.  Floss  &  Co.,  67  Md.  403.] 

2  [Roberts  v.  Germania  F.  Ins.  Co.,  71  Ga.  480  ;  Code,  §  2794.] 

3  [Croghan  v.  N.  Y.  Underwriters'  Agency,  53  Ga.  109,  Hi.  Dinning  v. 
Phffinix  Ins.  Co.,  68  111.  414,  418.  In  this  case  also  no  premium  was  paid,  and 
the  court  said  that  there  was  no  completed  contract,  oral  or  otherwise.] 

*  [.Johnson  v.  Com.  F.  Ins.  Co.,  84  Ky.  470.] 

^  [O'Reilly  v.  Corp.  London  Assurance,  101  N.  Y.  575,  57&.] 

(a)  See  Stewart  w.  Helvetia-Swiss  F.  North   British  &  Merc.   Ins.  Co.,    137 

Ins.   Co.,    102  Cal.   218.     The  insured  Penn.   St.  335;  Fidelity  &  Cas.  Co.  v. 

cannot  liave  the  advantage  of  a  custom,  AVilley,    80  Fed.   Rep.   497  ;    Baker   v. 

as  to  renewals  by  agents,  of  which  he  Commercial   Union  Ass.  Co.,  162  Mass. 

has  no  knowledge  or  notice.     Nippolt  358  ;  New  York  Lumber  Co.  v.  People's 

r.    Firemen's  Ins.  Co.,   57  Minn.    275.  F.  Ins.  Co.,  96  Mich.  20.    An  agent,  in 

In  JlcCabe  v.  ^tna  Ins.  Co.  (No.  Dak.),  renewing  a  iire  policy,  may  himself  care 

81  N.  W.  426,  430,  evidence  of  a  custom  for  the  renewal  premium,  and  retain  the 

on  the  agent's  part,  to  extend  credit  for  policy  until  it  is  paid  ;  in  which  case 

premiums,  was  held  admissible.  the  policy  is  binding  upon  the  insurer. 

(h)  These  questions  are  usually  mat-  Fireman's  Fund  Ins.  Co.  v.  Pekor,  106 

ter  of  fact  for  the  jury.     See  Long  v.  Ga.  1 ;  Baker  v.  Commercial  Union  Ass. 

132 


CII.  v.]  '      TERMINATION   AND   REVIVAL,  [§  70  B 

the  manner  of  its  own  renewal,  making  payment  of  the  pre- 
mium an  element,  and  this  was  not  done.  Parol  proof  that 
a  contract  of  insurance  was  actually  made  before  a  loss 
occurred,  though  executed  and  delivered  and  paid  for  after- 
wards, is  inadmissible.  1  The  plaintiff  claimed  that  he  could 
abandon  the  written  contract  and  rely  on  the  prior  verbal 
agreement  of  renewal,  which  was  made  before  loss,  but  the 
court  held  otherwise.  The  parol  agreement  that  precedes 
the  issuance  of  a  policy  in  the  first  place  fixes  the  terms  of 
the  contract,  and  is  held  to  be  a  valid  insurance  covering  a 
loss  that  may  occur  before  issue  of  the  policy,  and  a  con- 
tract of  renewal  should  be  put  on  the  same  basis ;  but  in  this 
case  the  evidence  of  a  parol  contract  does  not  seem  good,  and 
the  policy  merging  the  contract  only  took  effect  by  its  terms 
from  its  date.  Moreover,  in  this  case  there  was  little  doubt 
that  the  assured  knew  of  the  loss  at  the  time  he  applied  for 
the  policy,  and  that  his  attempt  to  prove  a  prior  oral  agree- 
ment was  a  mere  makeshift  to  consummate  his  fraud,  (a) 
The  doctrine  of  the  case,  however,  is  too  broad  if  we  quote 
it  without  remembering  the   peculiar  facts.      There  is  no 

^  [Insurance  Co.  v.  Lyman,  15  Wall.  664,  670.] 

Co.,  162  Mass.  358.     Where  the  agent  man's  Fund  Ins.  Co.,  8  Utah,  41,  43  ; 

who  had  issued  the  former  policy  signed  Zigler  v.    Phoenix  Ins.   Co.,   82   Iowa, 

a  renewal  policy  and  authorized  it  to  he  569.      When   the   agents   of  an   insur- 

fiUed,  and  afterwards  forwarded  it  as  a  ance   company  are   duly  authorized   to 

valid  contract  to  the  general  ngent  with-  solicit    and    make    contracts    of  insur- 

out  calling   for  the  renewal  premium,  ance,  and  deliberately  represent  to  the 

and  the  agent  of  the  insured,  on  applying  assured  that  a  given  policy  issued  by 

for  a  renewal  at  the  expiration  of  the  the  company  has   been    renewed,    and 

first  policy,  was  informed  what  had  been  subsequently   receive    and   appropriate 

done,  the   renewal   contract   was    held  money  which  they  have  good  reason  to 

binding    on    the    company.     Iiuni    v.  believe  is  paid  to  cover  the  cost  of  such 

United   States  F.  Ins.  Co.,    104  Mich,  extended  insurance,  the  company  is  es- 

397.     But  where  the  cashier  of  the  in-  topped  to  allege,  after  a  loss    lias   oc- 

sured  was  also  agent  of  the  insurer,  with  curred,  that  the  ywlicy  in  question  was 

authority  to    issue    policies,    and    was  not  renewed.    Int'l  Trust  Co.  y.  Norwich 

directed  by  the  manager  of  the  insured  U.  F.  Ins.   Co.,  71    Fed.  Rep.  81,  E6  ; 

to  renew  the  policy,  which  he  promised  Long  v.   North   British,  &c.    Ins.  Co., 

but  failed  to  do,  and  the  cashier  testi-  137   Penn.  St.  335  ;   American  F.  Ins. 

tied    that   he   intended   to   renew,   and  Co.  v.  Brooks,  83  Md.  22. 
supposed  he  had  done  so,  it  was  held  (a)  See  Dodd  v.  Home  Mut.  Ins.  Co., 

that  there  was  no  valid  contract  of  re-  22  Oregon,  3. 
newal.     Idaho  Forwarding  Co.  v.  Fire- 

133 


§  70  C]       insurance:  fire,  life,  accident,  etc.         [ch.  v. 

doubt  that  in  a  proper  case  good  evidence  of  a  prior  oral 
agreement  would  be  received.  When  an  agent  of  an  insur- 
ance company  has  authority  to  make  applications  binding 
until  disapproved  by  the  company  and  communication  of  the 
disapproval  to  the  assured,  an  agreement  by  him  to  extend 
an  expired  policy  is  valid  until  disapproved,  and  if  the  prop- 
erty burns  before  notice  of  disapproval  reaches  the  assured, 
the  company  is  liable. i  All  negotiations  and  contracts  are 
deemed  to  be  merged  in  the  policy,  and  any  parol  agreement 
with  the  agent  before  issue  of  the  policy,  that  he  shall  keep 
the  policy  renewed  from  year  to  year,  giving  the  plaintiff 
time  with  the  premiums,  does  not  bind  the  company,  but  a 
definite  parol  agreement  of  renewcil  in  presenti  would  be  sus- 
tained.2  On  the  facts  there  is  really  no  conflict  in  the  cases. 
A  parol  agreement  of  or  for  renewal  may  be  made  with  the 
same  freedom  and  certainty  as  a  parol  agreement  of  original 
insurance.] 

[§  70  C.  Revival.  —  Nothing  can  revive  a  void  contract 
short  of  a  new  contract  on  valid  consideration,  or  conduct 
amounting  to  estoppel. ^  (a)  Where  the  plaintiffs  as  agents 
paid  in  more  money  than  they  owed  the  company  and  the 

1  [Leeds  v.  Mechanics'  Ins.  Co.,  8  N.  Y.  351,  357.] 

2  [Giddings  v.  Phoenix  Ins.  Co.,  90  Mo.  272,  277.] 

8  [N.  Y.  Cent.  Ins.  Co.  v.  Watson,  23  Mich.  486,  488.] 

(ffl)  See  Dale  v.  Continental  Ins.  Co.,  Fund  L.  Ass'n,  132  N.  Y.  378  ;  Jones  v. 

95  Teun.  38  ;  Com'th   v.  Provident  L.  Preferred  Bankers'  L.  Ass.  Co.  (Mich.), 

Ass'n,  163  Penn.  St.  374  ;  Bottomley  v.  79  N.  W.  284  ;  United  Secuiity,  &c.  Co. 

Met'n  L.  Ins.  Co.,  170  Mass.  274  ;  Mu-  v.  Ritchey,  187  Penn.  St.  173.     Upon 

tual  Reserve  Fund  L.  Ass'n  v.  Hamlin,  default  in  paying  a  premium,  when  the 

139  U.  S.  297 ;  Equitable  L.  Ass.  Soci-  policy  allows  opportunity  for  reinstate- 

etyv.  McElroy,  83Fed.  Rep.  631.    As  to  ment,  the  assured,  if  in  good  health, 

reinstatement,  upon  failure  to  duly  pay  and  acting  promptly,  is  entitled  to  be 

premiums  or  assessments  for  life  insur-  reinstated,  though   then   past   the   age 

ance,  see  French  v.  Hartford  L.  Ins.  Co.,  for  insuring  new  members.     Lovick  v. 

169  Mass.  510;  Colby «.  Life  Indemnity  Providence    L.    Ass'n,    110    N.    C.    93. 

Co.,  57  Minn.   510  ;  Riegel   v.    Amer-  The  policy  continues  lapsed  if  the  re- 

ican  L.  Ins.  Co.,   153  Penn.  St.   134;  instatement  is  obtained  by  fraud,  and 

Reilly  v.  Chicago    Guaranty  Fund    L.  this  is  not  waived  by  the  insurer.    Mass. 

Society,  75  Minn.  377  ;  Knights  Tem-  Benefit  L.  Ass'n  v.  Robinson,  104   Ga. 

plars'  L.   Ind.  Co.  v.  Jacobus,  80  Fed.  256  ;    see    French    v.    Mutual    Reserve 

Rep.  202  ;  Coburn  v.  Life  Indemnity  Co.,  Fund  L.  Ass'n,  111  N.  C.  391. 
52  Minn.  424;  Ronald  ji.  Mutual  Reserve 

134 


CH.  v.]  TEKMINATION   AND   KEVIVAL.  [§  70  C 

surplus  was  retained,  it  was  held  that  the  company  must  be 
treated  as  having  applied  the  surplus  to  revive  certain  lapsed 
policies  of  the  plaintiffs  which  were  at  the  time  the  subject 
of  negotiations  for  revivor.  ^  Representations  in  a  revival 
certificate  warranted  to  be  true  as  a  condition  of  revival, 
become  part  of  the  contract  upon  assent  to  the  revival.^] 

1  [Kirkpatrick  v.  South  Aus.  Ins.  Co.  (J.  C),  11  App.  Cas.  177.] 

2  [Metropolitan  L.  Ins.  Co.  v.  McTague,  49  N.  J.  587.] 


135 


INSURANCE  :    FIKE,  LIFE,  ACCIDENT,   Eia  [CH.  VI. 


CHAPTER  VI. 

SUBJECT-MATTER.  —  INSURABLE  INTEREST. 

Analysis. 

1.  Subject-matter : 

any  lawful  interest,  §  71. 

having  an  appreciable  pecuniary  value,  §  72. 

though  no  market  value,  §  72. 

nor  even  actual  existence,  §  72. 
the  thing  or  life  is  not  insured,  but  some  person  in  respect  to  it,  §  72. 
life,  health,  liberty,  solvability,  fidelity,  property,  profits,  &c.,  §  73. 

2.  Insurable  interest : 

1.  Necessity  of,  §  74. 

wager  policies  (i.  e.  policies  without  interest)  not  now  sustained, 

§75. 
but  reprobated,  §  75  A. 
"interest  or  no  interest,"  §  75. 

a  policy  that  is  to  "  be  proof  of  interest  "  is  a  wager,  §  75. 
bets  on  sex,  §  75  A. 
on  life,  §  75  B. 
on  marriage,  §  75  B. 

policy  of  13000  to  cover  a  debt  of  $70,  §§  75  B,  108. 
policy  taken  out  by  a  man  on  his  own  life,  payable  to  any  one 

he  may  desire,  is  not  a  wager,  §  75  B, 

2.  What  constitutes. 

The  test : 

So  that  insurance  does  not  aim  at  the  protection  of  any 
one  in  the  violation  of  law,  or  the  forwarding  of  any  ille- 
gal purpose, 

A  has  an  insurable  interest 

(1)  in  his  own  life  and  health, 

(2)  in  the  life,  health,  solvability,  liberty,  fidelity,  care,  &c.,  of 

another,  when  its  failure  would  bring  upon  him  a  loss  of 
money  or  other  thing  of  a  nature  regarded  by  the  law  as 
a  good  consideration  for  a  contract,  to  the  enjoyment  of 
which  money  or  thing  he  has  a  right,  or  will  have  it  in 
the  natural  and  not  unlawful  course  of  things. 
Blood  relationship  alone,  if  very  close  and  of  a  kind  usu- 
ally resulting   in  pecuniary  advantage,  is  sufiicient, 
especially  if  there  is  a  legal  liability  of  support. 
Generally  relationship  must  be   aided  by    special  circum- 
stances (see  below). 
Marriage  or  an  agreement  to  marry  is  sufficient  (see  below). 

136 


CH.  VI.]  SUBJECT-MATTEK.  —  INSURABLE   INTEREST. 

(3)  In  respect  to  property,  present  or  future,  the  destruction 
of  which  would  render  him  liable  to  reimburse  others, 
or  in  relation  to  which  he  has  any  legal  or  equitable 
"ght.  great  or  small,  vested  or  contingent,  which  in 
the  ordinary  and  natural  course  of  things  would  result 
in  advantage  to  him,  so  that  he  has  a  personal  inter- 
est in  the  preservation  of  the  property  in  regard  to 
which  the  insurance  is  made. 
"  interest "  does  not  imply  "property"  in  the  thing  insured, 

§  74,  n. 
interest  in  a  life  need  not  be  capable  of  pecuniary  estimate, 

§  102  A. 
strong  ties  of  blood,  §  102  A. 
marriage,  §  102  A. 

any  reasonable  probability  of  present  or  future  pecuniary  ad- 
vantage is  enough,  §  76. 
that  one  may  suffer  loss  of  something  they  have  some  claim  to 

look  for  in  the  natural  course  of  things  is  sufBcient,  §  80. 
contingent  right  sufficient,  §  77. 
profits  or  advantages  that  would  come  in  the  ordinary  course 

of  things  may  be  insured,  §§  76,  79,  80. 
but  a  mere  hope  without  a  scintilla  of  present  interest  is  not 
enough.     One  has  no  right  to  indemnity  because  he  does 
not  receive  a  gift  he  expects,  §  78. 
A  present  interest  in  the  property  or  enterprise  out  of  which  the 

profit  is  to  coyne  is  necessary,  §  77. 
and  when  the  interest  in  the  goods  ceases  the  policy  decays, 

§79. 
any  benefit  reasonably  certain  to  come  from  the  continued  ex- 
istence of  the  property  or  life  is  sufficient,  §§  80  (life) 
102  A. 
liability  for  loss  of  the  property  if  destroyed  is  sufficient,  com- 
mon carrier,  &c.,  §§  83,  94,  94  A,  95. 
even  though  a  debt  is  that  of  an  infant  or  the  statute  of 
limitations  has  run  on  it  the  creditor  may  insure  it, 
§  108. 
interest  of  an  insurer,  §  98. 
possession  under  a  cZarai  of  ownership  sufficient,  §§  80,  84,  87  A. 
possession  under  contract  of  purchase,  §  87. 
possession  under  contract  that  may  ripen  into  o^vnership  is  suf- 
ficient, whether  purchase-money  is  paid  or  not,  §  87  A. 
possession  under  contract  of  purchase  is  sufficient  though  the 
vendee  is  in  default,   and  even  after  an  agreement  to  re- 
scind the  contract  of  purchase,  §  87  A. 
defect  in  title  will  not  avail  the  company,  §  87  A. 
possession  under  a  deed  voidable  for  fraud  is  sufficient,  §  87  A. 

or  voidable  for  want  of  title  in  grantor,  §  87  A. 
equitable  title  sufficient,  §  86. 
3.     "What  is  not  an  insurable  interest.     (See  wager  policies  above,  in  1 ) 
in  life.     (See  below  at  the  end  of  5.) 
in  property 

unlawful  enterprise,  §  71. 

137 


INSUKANCE  :    FIRE,    LIFE,   ACCIDENT,   ETC.  [CH.  VI. 

lotteries,  §  71. 

prohibited  voyage,  §  71. 

goods  intended  for  illegal  sale,  §  71. 

raere  hope,  §  78. 

expectation  of  a  gift,  §  78. 

donor  or  volnntary  contributor  no  insurable  interest  in 
the  object,  §  76  A. 

voluntary  repairs  on  vessel  give  none,  §  76  A. 

no  insurance  of  bills  payable  on  a  contingency,      76  A. 

possession  under  a  married  woman's  agreement  to  convey  is 
not  sufficient  to  create  an  insurable  interest  in  a  State 
where  such  agreement  is  void,  §  87  A. 

possession  by  vendor  after  delivery  of  goods  not  sufficient,§97. 

a  claim  of  title  under  a  fictitious  deed,  without  actual  pos- 
session is  not  sufficient,  §  87  A. 

mere  intrusion  on  land,  §  89. 

right  under  contract  mt  enforceable  is  not  insurable,  §  96. 
vendee's  interest  under  a  contract  void  by  statute  of 

frauds,  §  96. 
verbal  contract  for  purchase  of  real  estate,  §  96. 
mortgage  by  one  having  no  right  to  give  it,  §  96. 
Who  may  have  an  insurable  interest. 
In  property  : 

any  one  who  is  charged  with  the  protection  of  the  prop- 
erty, §  80. 

or  has  a  right  to  protect  it,  §  80. 

or  will  receive  a  benefit  from  its  continued  existence,  §  80. 

or  be  liable  to  loss  by  its  destruction,  §§  83,  94,  94  A,  95. 

son  none  in  father's  property,  §  76  A. 

administrators,  §  80. 

bailee,  §  95. 

a  bailee  if  interested  or  responsible  for  loss  may  insure 
in  his  own  name,  and  if  not  he  may  still  insure 
for  whom  it  may  concern,  §  95  A. 
bailee  will  hold  the  funds  in  trust  for  owner,  §  95  A. 

builder  under  contract,  §§  93,  95  A. 

captors,  §  80. 

cestui  que  trust,  §  82. 

common  carriers,  §§  80,  94,  94  A. 

though  using  vessel  of  another,  §  94  A. 

commission  merchant,  §  95  A. 

consignees,  §§  80,  95  A. 

contractor,  §§  93,  95  A. 

creditor,  §§  83,  95. 

debtor  in  property  attached,  §  95. 

disseizor  has,  §  81. 

executors,  §  80. 

factor,  §§  80,  95  A. 

guarantor,  §§  82,  97. 

hirer,  §  82. 

indorser,  §  82. 

holder  of  note,  §  97. 

138 


CH.  VI.]  SUBJECT-MATTER.  —  INSURABLE   INTEREST. 

husband  in  wife's  property,  §  81. 

husband  in  homestead,  §  81. 

innkeeper,  §  80. 

insolvent   has,   even   in   goods   concealed   from  creditors, 

§§  81,  92,  n. 
intruder,  §  89. 

landlord  in  goods  of  tenant  liable  to  distress  for  rent,  §  84. 
lessee,  §  84. 
lessor,  §§  84,  85. 
master  of  ship,  §  94  A. 
mortgagee,  §§  80,  82,  83,  96. 
mortgagor  has,  though  property  mortgaged  to  full  value, 

if  he  is  liable  for  the  debt,  even  after  he  has  sold  the 

equity   of  redemption,  §  82. 
forfeiture  of  the  property  for  violation  of  law  or  unlawful 

foreclosure  will  not  avail  the  company,  §  82,  n. 
one  having  a  lieu  for  advances  or  otherwise,  §§  82,  93. 
one  having  a  claim  in  the  nature  of  a  lien,  §  93. 
one  having  an  equitable  lieu  with  possession,  §  93  A. 
one  havuig  an  equitable  interest,  §§  86,  93  A. 
one  having  possession  under  claim  of  title,  §§  87,  87  A. 
part  owner  responsible  for  whole,  §  94  A. 
pledgee,  §§  80,  82,  93  A. 
pledgor,  §  82. 

railroad  liable  for  destruction  by  sparks,  §  94. 
stockholder,  §  90. 
surety,  §  82. 
tenant  in  common,  §  81. 
trustee,  §§  80,  83. 

vendee  in  possession,  §§  83  a,  87,  88,  96. 
vendor  before  delivery  or  complete  sale  has,  §§  83  a,  88,  97. 
vendor  may  insure  in   name  of  vendee  though  the  goods 

are  not  separated,  §  83  a,  note, 
warehouseman,  §§  80,  95  A. 
wharfinger,  §§  80,  95  A. 
5.  In  life : 

betrothed  girl  in  life  of  future  husband,  §  107  a. 
creditor  may  insure  life  of  debtor,  §§  102  A,  108,  109. 

only  entitled  to  indemnity,  §  108. 

but  he  has  been  allowed  to  hold  the  excess,  §  108. 

has  interest  even  when  debtor  is  an  infant,  §  108. 

or  statute  of  limitations  has  run  against  the  debt,  §  108. 

insurance  far  beyond  the  debt  will  be  void,  §  108. 
employee  in  employer's  life,  §  109  c. 
father,  in  life  of  son  or  daughter,  §§  104-107. 
husband  in  wife's  life,  §  107  C. 
master  in  servant's  life,  §  109  c. 
mother  in  life  of  son,  §  107  t. 

one  having  reasonable  expectation  of  pecuniary  advantage 
from  the  continuance  of  the  life,  §  102  A. 

as  in  case  of  one  contracting  to  do  work,  §  109  b. 
parent  in  life  of  child,  §§  102  A,  103-107. 

139 


INSURANCE  ;    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  VL 

partner  in  copartner,  §  109  a. 
sister  in  brother  {in  loco  parentis),  §§  103-107. 
surety,  §  102  A. 
trustee,  §  111. 

wife  in  life  of  husband,  §  107  b. 
one  related  by  strong  ties  of  blood,  §§  102  A-107. 
relationship  not  sufficient. 

brother  in  life  of  brother  as  such,  no,  §  107  s. 
daughter  in  life  of  mother,  no,  §  103  A. 
granddaughter    in    life    of    grandfather,     no, 

§  103  A. 
nephew  in  uncle,  no,  §  107  s. 

in  aunt,  no,  §  103  A. 
son-in-law  in  life  of  mother-in-law,  no,  §  103  A. 

Duration : 

general  rule,  an  interest  at  time  of  insurance  and  at  loss  both 

necessary,  §§  100,  100  A, 
cessation  of  iutei-est  before  loss  generally  destroys  the  right  of 
recovery,  §§  79,  100,  100  A. 
but  there  may  be  cases  where  the  company  should  be  held 
and  the  insured  treated  as  a  trustee  for  the  one  who 
has  really  experienced  a  loss,  §  100  A. 
this  is  especially  likely  to  happen  in  case  of  life  insurance, 
as  where  a  creditor  insures  the  life  of  the  debtor,  and 
the  debt  is   paid  before  the  debtor  dies.     Here  the 
creditor  should  recover  on  the  policy,   otherwise  he 
will  lose  his  premiums  and  the  company  escape  a  risk 
fairly  undertaken.     But  he  should  hold  the  excess  of 
funds  above  indemnity  in  trust  for  the  estate  of  the 
debtor,  §§  100  A,  108,  115-117. 
in  England,  if  the  insured  has  an  interest  at  the  time  of  the 
contract  of  insurance  it  is  sufficient  to  sustain  the  policy, 
though  his  interest   may  cease  before  death  of  the  party 
whose  life  is  the  risk.     At  common  law  a  life  policy  was 
good  without  any  interest,  and  the  statute  (14  Geo.   III. 
c.  48)  only  requires  an  interest  at  the  inception  of  the  con- 
tract.    The  rule  is  certainly  just,   that,  in  the  case  of  a 
valued  life  policy,  holds  the  parties  to  the  original  agree- 
ment  made   upon   a   fair  estimate  of  the  interest  of  the 
insured  at  that  time.     The  insured  continues  to  pay  pre- 
miums upon  the  basis  of  that  interest,   and  the  insurer 
should  be  liable  on  the  same  basis.     If  a  debtor  whose  life 
was  insured  by  paying  the  debt  terminated  the  creditor's 
policy,  the  latter  might  lose  as  much   or  more  than  the 
debt  in  premiums  and  interest.     Under  such  a  rule  the 
creditor  must  lose   either  the  original   debt  or  his   pre- 
miums, i.  e,  he  must  be  a  loser  any  way,  §§  115-116,  108, 
100  A. 
in  Massachusetts,  if  the  interest  in  the  insured  life  terminates 
after   payment  of  two   annual  premiums,   the  policy  be- 
comes payable  at  a  fair  surrender  value.     Public  Statutes, 
§  719. 

140 


CH.  VI.]  SUBJECT-MATTEK.  —  INSURABLE   INTEREST.  [§  71 

interest  acquired  after  insurance,  but  before  loss,  should  sustain 
policy  if  company  treats  it  as  valid  after  knowing  facts, 
§  100  A,  authority  contra,  §  100  A. 

subsequently  acq^uired  goods,  may  certainly  be  covered,  §§  100, 
101. 

7.  Continuity  of  interest  is  not  necessary.      In  the  absence  of  express 

stipulation  an  interruption  that  ends  before  loss  is  not  fatal,  but 
only  suspends  the  policy,  like  a  temporary  breach  of  condition, 
§101. 

8.  Miscellaneous  : 

insurance  of  good  and  bad  interests  or  interest,  and  no  interest, 
in  same  policy  good  pro  tanto,  §  74. 
unless  the  contract   is  expressly  or  by  its  nature   entire, 
§74. 

insurable  interest  a  question  of  law,  on  the  facts  proved,  §  76,  n. 

company's  knowledge  of  no  interest  immaterial,  §  81,  n, 

assignee  of  life  policy,  §  110. 

beneficiary,  §112;  his  name  must  ap[)ear  on  the  policy  in 
England,  §  113. 
one  without  interest  cannot  take  out  a  policy  on  the  life  of 
another,  but  a  man  may  take  out  a  policy  on  his  own 
life  and  make  it  payable  to  whom  he  pleases,  or  assign 
it  to  any  one.  A  man's  care  for  his  own  life  is  suffi- 
cient guarantee  that  he  will  not  jeopardize  it,  and  if 
his  activity  and  consent  is  required  to  make  a  good 
policy,  the  reason  of  the  law  is  satisfied  whoever  pays 
the  premiums.  Tliere  is  some  dispute  about  this,  but 
it  is  plain  common  sense,  and  there  is  good  authority 
for  it,  §§  110,  notes,  112  ;  contra,  §  110,  n. 

life  policy  usually  a  valued  one,  §  114. 

§  71.  What  may  be  Insured.  —  One  may  insure  that  in 
which  he  has  an  interest,  and  which  the  law  does  not  forbid 
to  be  insured.  There  are  certain  unlawful  enterprises  in 
which  property  may  be  embarked,  but,  being  unlawful,  the 
law  will  not  uphold  any  contract  of  insurance  or  other  con- 
tract in  favor  of  them,  which  has  for  i^s  purpose  to  aid  or  in 
any  way  promote  the  success  of  such  enterprises  by  protect- 
ing the  property  embarked  therein.^     Of  this  kind  of  enter- 

1  [Insurance  on  a  voyage  prohibited  by  the  home  sovereign  is  void :  Richard- 
son V.  Marine  Ins.  Co.,  6  Mass.  101,  111  ;  but  not  one  merely  in  violation  of 
foreign  trade  laws  or  the  law  of  nations  in  respect  to  contraband  of  war.  In- 
surance will  not  be  supported  to  forward  an  illegal  purpose.  Goods  intended  for 
illegal  sale  cannot  be  insured.  But  if  nothing  illegal  appears  in  the  purpose  of 
the  contract,  mere  collateral  acts,  as  illegal  selling  of  liquor,  will  not  avoid  the 
policy.  The  nature  and  purpose  of  the  insurance,  whether  collateral  to  or  in  aid 
of  a  violation  of  the  law,  is  to  be  submitted  to  the  jury.  Carrigan  v.  Insurance 
Co.,  53  Vt.  418.] 

141 


§  72]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  VI. 

prises  the  slave-trade  is  an  example.  The  same  may  be  said 
of  lotteries,  where  lotteries  are  unlawful.  Neither  will  in- 
surance protect  property  which  it  is  unlawful  to  have. 
Whatever  the  law  discourages  and  disapproves  of,  whether 
by  special  statute  or  upon  general  principles  enforced  by  the 
common  law  in  the  interest  of  good  morals,  good  order,  and 
general  public  policy,  will  not  be  fostered  or  encouraged  by 
insurance.^ 

§  72.  Subject  to  the  limitation  stated  in  the  preceding 
section,  whatever  has  an  appreciable  pecuniary  value,  and 
is  subject  to  loss  or  deterioration,  or  of  which  one  may  be 
deprived,  or  which  he  may  fail  to  realize,  whereby  his  pecu- 
niary interest  is  or  may  be  prejudiced,  may  properly  constitute 
the  subject-matter  of  insurance.  ^  (a)  It  may  have  neither  a 
corporeal  existence,  nor  marketable  value,  nor  an  actual  but 
only  a  potential  being;  for  it  is  not  so  much  the  right, 
thing,  or  expectancy  which  is  insured,  as  the  possessor  him- 
self, against  the  loss  or  damage  which  unforeseen  events  may 
bring  thereto.  When,  therefore,  the  subject-matter  of  in- 
surance is  termed,  as  it  frequently  is,  the  aliment  of  the 
contract,  it  is  not  to  be  understood  that  this  aliment  is 
something  upon  which  the  contract  fastens  and   feeds,   to 

1  Boulay-Paty,  Cours  de  Droit  Com.  tit.  x.  §  5,  who  cites  Kuricke,  Diatr.Assec. 
Assecurari  possunt  omnia  quae  assecurari  nee  de  jure,  nee  de  consuetudine,  quae 
vim  juris  liabet,  prohibentur.  Mouut  et  al.  v.  Waite,  7  Johns.  (N.  Y.)  434  ; 
Lord  V.  Dall,  12  Mass.  115  ;  ante,  §  7. 

2  Pardessus,  Cours  de  Droit  Com.,  589,  2  &  4. 

(a)  An  insurable  interest  need  not  sure  his  interest  in  the  profits  on  such 
he  personal,  or  founded  on  an  absolute  risks  in  another  company.  Hayes  v. 
title  ;  it  may  exist  in  favor  of  a  trustee,  Milford  M,  F.  Ins.  Co.,  170  Mass.  492. 
administrator,  agent,  mortgagee,  &c.  See  Graham  v.  American  F.  Ins.  Co.,  48 
It  must  be  such  an  interest  that  pecu-  S.  C.  195.  Agents,  commission  mer- 
niary  loss  will  result  to  the  assured  chants,  carriers,  and  the  like,  who  have 
from  the  destruction  of  the  property,  the  custody  of  personalty,  and  are  re- 
Rochester  Loan  Co.  v.  Liberty  Ins.  Co.,  sponsible  therefor,  may  insure  it  in  their 
44  Neb.  537  ;  Hanover  F.  Ins.  Co.  v.  own  names,  and  are  entitled  to  recover 
Bohn,  48  Neb.  743  ;  Hartford  F.  Ins.  the  full  value  of  the  property.  West- 
Co.  V.  Keating,  86  Md.  130.  An  agent,  em  &  Atlantic  Pipe  Lines  v.  Home  Ins. 
who  is  by  contract  entitled  to  a  percent-  Co.,  145  Penn.  St.  346  ;  Lancaster  Mills 
age  of  the  receipts  and  profits  of  the  d.  Merchants' Cotton  Press  Co.,  89  Tenn. 
insurance  business  written  by  him,  has  1  ;  Roberts  v.  Firemen's  Ins.  Co.,  165 
an  insurable  interest  in  the  risks  writ-  Penn.  St.  55;  Ins.  Co.  of  North  Amer- 
ten  by  him  as  such  agent,  aud  may  in-  ica  v.  Forcheimer,  86  Ala.  541. 

142 


CH.  VI.]  SUBJECT-MATTER.  —  INSURABLE   INTEREST.  [§  73 

which  it  clings,  and  from  which  it  is  inseparable.  In  popu- 
lar language,  a  house  is  said  to  be  insured ;  but  in  point  of 
fact  the  owner  is  insured  on,  or  in  respect  of,  the  house,  or, 
in  other  words,  against  any  loss  which  may  happen  to  him 
while  he  is  owner,  and  because  of  his  ownership,  absolute 
or  qualified.  When  this  ownership  ceases,  the  property  also 
ceases  to  furnish  aliment  for  the  contract,  and  it  dies.  It  is 
the  union  between  the  two  —  between  the  person  with  whom 
the  contract  is  made  and  the  subject-matter  about  which  it 
is  made,  in  the  relation  of  the  possessor  to  the  thing  pos- 
sessed —  that  keeps  alive  the  contract.  And  when  this 
union  is  permanently  sundered  before  loss  or  the  event  in- 
sured against  happens,  the  contract  loses  its  vitality.  A 
transfer  of  the  property  and  an  assignment  of  the  policy  is 
not  a  prolongation  of  the  life  of  the  contract,  but  a  new 
contract  with  another  person  about  the  same  subject-matter. 
So  in  life  insurance  the  aliment  of  the  contract  is  the  in- 
terest which  the  insured  has  in  the  preservation  of  the  life 
insured,  and  the  protection  is  against  loss  to  the  insurer  in 
case  of  cessation  of  the  life.^ 

§  73.  Under  these  qvialifications  the  contract  may  era- 
brace  not  only  personal  property  and  real  estate,  but  the 
lives  of  animals,  among  which  slaves  are  included  for  this 
purpose ;  the  life,  health,  and  personal  liberty  of  man ;  the 
solvability  of  a  debtor ;  the  payment  of  a  note  at  maturity ;  ^ 
the  fidelity  of  a  servant;  expected  profits;  the  damages  to 
which  growing  crops  are  exposed  from  frosts  and  storms; 
the  risk  of  death  or  injury  by  accident  to  the  person  in 
travelling  or  otherwise;  lottery  tickets,  where  lotteries  are 
permitted ;  the  risk  of  loss  of  property  by  the  capture  of  a 
fort  by  an  enemy  ;^  the  danger  of  loss  by  dishonesty,  fraud, 
and  theft,  or  by  the  nonpayment  of  rent,  interest,  or  income, 
or  by  the  invalidity  of  titles,  or  by  the  death  of  one  upon 
whom    depends   the    continuance    of    pecuniary   support   or 

1  Wilson  V.  Hill,  3  Met.  (Mass.)  66;  Carpenters.  Prov.  Wash.  Ins.  Co.,  16 
Peters  (U.  S. ),  495.     See  also  ante,  §  6. 

2  Ellicott  V.  United  States  Ins.  Co.,  8  0111  &  Johns.  (Md.)  166. 
8  Carter  v.  Boehra,  3  Burr.  1905. 

143 


§  74]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  VI. 

assistance;  and,  in  general,  "it  is  applicable,"  to  use  the 
language  of  Mr.  Justice  Lawrence, ^  "to  protect  men  against 
uncertain  events  which  may  in  any  wise  be  of  disadvantage 
to  them. "  In  most  of  these  instances  the  contract  has  been 
successfully  applied.  Of  their  respective  peculiarities  we 
shall  have  occasion  to  treat  more  at  length  hereafter.  The 
practice  of  insuring  crops  is  much  in  vogue  in  France  ;2  and 
guaranty  insurance,  as  it  is  called,  instituted  as  a  substitute 
for  private  suretyship,  to  aid  persons  in  obtaining  places  of 
trust  and  responsibility,  and  to  protect  employers  from  the 
unfaithfulness  of  employes,  has  met  with  some  success  in 
England. 

§  74.  Insured  must  have  a  Lawful  Interest.  —  When  there 
is  no  interest  at  all  to  be  protected,  a  policy  of  insurance 
will  be  invalid,  as  counter  to  the  spirit  and  purpose  of  the 
contract,  as  well  as  against  public  policy.^  Insurance  is 
made  for  the  benefit  and  protection  of  legitimate  business 
and  purposes,  and  not  that  persons  unconcerned  therein,  and 
without  any  interest  in  the  property  or  event,  should  profit 
thereby.  And  although  innocent  wagers  were  once  sus- 
tained, the  courts  will  not  now  waste  their  time  in  discuss- 
ing the  question  whether  what  is  substantially  a  wager  ought 
or  ought  not  to  be  upheld  upon  any  grounds.  Under  the  in- 
fluence of  a  healthy  public  sentiment  they  have  become  im- 
patient of  investigating  disputes  founded  upon  any  species  of 
gambling,  and  almost  without  exception  refuse  to  enforce  a 
contract  supported  by  such  a  subject-matter.*  Insurance  of 
interests  prohibited  by  law,  and  insurance  without  interest, 
if  included  in  the  same  policy  with  interests  .which  may  be 
lawfully  insured,  do  not  vitiate  the  policy,  except  as  to  the 

1  Lncena  v.  Crauford,  2  B.  &  P.  New  Eep.  269,  301. 

2  Pardessns,  Droit  Com.,  589. 

8  [G.  cannot  insure  the  property  of  H.  ;  HenningiJ.  Western  Ass.  Co.,  77  Iowa, 
319.] 

*  Sadler  Co.  v.  Badcock,  2  Atk.  554  ;  19  Geo.  II.  c.  37  ;  Kent  v.  Bird,  Cowp. 
583";  Amory  v.  Gilman,  2  Mass.  1  ;  King  v.  State  Mut.  Fire  Ins.  Co.,  7  Cush. 
(Mass.)  1,  10;  Pritchet  v.  Insurance  Co.  of  North  America,  3  Yeates  (Pa.),  458, 
464  ;  3  Kent,  Com.  278;  Ruse  v.  Mutual  Benefit  Life  Ins.  Co.,  23  N.  Y.  516  ; 
Fowler  v.  New  York  Indemnity  Ins.  Co.,  26  N.  Y.  422  ;  Freeman  v.  Fulton  Fire 
Ins.  Co.,  38  Barb.  (N.  Y.)  247  ;  s.  c.  14  Abbott,  Pr.  Cases,  398. 

144 


en.  VI.]  SUBJECT-MATTEE.  —  INSURABLE    INTEREST.  [§  75 

prohibited  or  non-existent  interests.  It  remains  valid  for 
so  mucli  as  constitutes  a  legitimate  insurable  interest.  If, 
however,  where  several  parcels  of  property,  separately  val- 
ued, the  premium  being  a  single  sum,  are  insured  by  a  pol- 
icy by  its  terms  made  void  if  the  true  title  be  not  stated, 
the  title  of  either  parcel  be  untruly  stated,  there  can  be  no 
recovery  for  the  loss  of  either  parcel,  since  the  contract  is 
an  entire  one.^  [The  term  "interest"  does  not  necessarily 
imply  property  in  the  subject  of  the  insurance.  ^J 

§  75.  Wager  Policy  [continued).  —  Although  policies  of 
insurance  made  for  the  benefit  of  parties  who  have  no  in- 
terest in  the  property  or  event  which  constitutes  the  subject- 
matter  of  insurance  are  inconsistent  with  the  true  principles 
of  insurance,  yet  the  courts,  in  the  early  history  of  the  con- 
tract, in  cases  of  marine  insurance,  "interest  or  no  interest," 
looking  upon  such  policies  as  in  the  nature  of  an  innocent 
wager,  and  therefore  sustainable  at  common  law,  manifested 
a  disposition  to  uphold  them.^  But  both  in  England  and  in 
some  of  the  States  of  this  country  the  legislative  powers  have 
intervened  and  expressly  declared  the  invalidity  of  policies 
without  interest.  And  even  when  this  intervention  has  not 
taken  place  the  courts  now,  nearly  without  exception,^  hold 
such  policies  void,  not  only  because  in  contravention  of  the 
fundamental  object  of  the  contract,  — indemnity,  since  where 

1  Day  V.  Charter  Oak  Fire  &  Mar.  Ins.  Co.,  51  Me.  91.     See  aXso  post,  §  189. 

2  [Buck  V.  Chesapeake  Ins.  Co.,  1  Pet.  151,  163.] 

3  "  There  is  some  strange  language,"  says  Lord  Eldon  —  Lucena  v.  Crauford, 
2  New  Rep.  (5  Bos.  &  Pul.)  322,  —  "  to  be  found  in  our  books  respecting  wager- 
ing and  valued  policies,  the  latter  of  which,  though  frequently  in  effect  wagering 
policies,  have  been  permitted  because  it  has  been  supposed  that  the  convenience 
of  them  is  greater  than  would  result  from  the  prohibition  of  them."  [When  there 
is  insurance,  "  interest,  or  no  interest,"  the  company  is  not  permitted  to  prove  no 
interest  in  the  assured.     Depaba  v.  Ludlaw,  2  Com.  Hep.  361.] 

*  In  New  Jersey,  in  1854,  it  was  said,  though  the  case  did  not  require  the 
point  to  be  decided,  that  a  life  policy  without  interest  is  an  innocent  wager  and 
good  at  common  law.  Trenton  Mut.  Life  &  Fire  Ins.  Co.  v.  Johnson,  4  Zabr. 
(N.  J.)  576  ;  Ruse  v.  Mutual  Benefit  Life  Ins.  Co.,  23  N.  Y.  (9  Smith)  516.  And 
perhaps  the  same  would  be  held  in  Rliode  Island.  Mowry  v.  Home  Ins.  Co., 
9  R.  I.  346.  See  also  Chisholm  v.  National  Capitol  Life  Ins.  Co.,  52  Mo.  213  ; 
and  post.,  §  107.  In  Ireland,  wagering  policies  are  valid.  Shannon  v.  Nugent, 
Hayes,  536  ;  Schweiger  v.  Magee,  Cooke  &  Al.  182.  [Wager  policies  are  not 
illegal  in  Ireland.  Keith  v.  Protection  Marine  Ins.  Co.  of  Paris,  Ir.  L.  R.  10 
Ex.  51.] 

VOL.  I.  —  10  145 


§  75  A]         INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  VI. 

there  is  no  interest  there  can  be  no  loss,  and  where  there  is 
no  loss  there  can  be  no  indemnity,  —  but  because,  when  the 
insured  has  nothing  to  lose,  but  everything  to  gain,  by  the 
happening  of  the  event  insured  against,  it  would  be  danger- 
ous and  demoralizing  to  subject  the  insured  to  so  great  a 
temptation  to  destroy  the  property  or  the  life  upon  which 
the  insurance  is  effected.  A  sound  public  policy  will  not 
sanction  any  such  temptation.  And,  indeed,  the  nearer  the 
insured  is  brought  by  the  terms  of  the  contract  into  such  a 
position  that  he  can  in  no  event  be  the  gainer,  the  more 
nearly  will  the  contract  conform  to  the  true  principles  of 
insurance.  In  accordance  with  this  view,  the  better  class 
of  insurers  not  only  take  the  smcUest  risks  in  proportion  to 
the  total  value  of  the  thing  insured,  but  exercise  the  great- 
est caution  lest  the  total  valuation  should  be  fixed  at  so  high 
a  rate  as  practically  to  offer  to  the  insured  a  margin  of  profit 
beyond  the  actual  indemnity,  in  case  of  loss.  [A  policy  pro- 
viding that  no  further  proof  of  interest  than  the  policy  shall 
be  required  is  a  wager  contract. ^  But  exactly  to  the  con- 
trary, it  has  been  held  that  the  words,  "  policy  to  be  proof 
of  interest,"  are  not  of  themselves  evidence  of  a  wager 
policy.  2] 

[§  75  A.  Wager  Fire  Policies ;  Bets  on  Sex.  —  Insurance, 
made  by  one  without  an  interest  in  the  subject-matter,  is 
void.^  Every  species  of  gaming  contracts,  wherein  the  in- 
sured has  no  interest,  or  a  colorable  one  only,  or  having  a 
small  interest  much  overvalues  it  in  a  valued  policy,  are 
reprobated  both  by  our  law  and  usage. "^  By  English  law  an 
engagement  to  pay  £100  in  case  Brazilian  shares  should  be 
done  at  a  certain  sum  on  a  certain  day,  all  in  consideration 

1  [Keith  V.  Protection  Mar.  Ins.  Co.  of  Paris,  10  Jr.  L.  R.  (Ex.)  51.] 

2  [Clendining  r.  Church,  3  Caines,  141,  144.] 

8  [Goddart  v.  Garrett,  2  Vern.  269  ;  Howard  v.  Lancashire  Ins.  Co.,  5  Russ. 
&  Geld.  (Nova  Sco.)  172,  173,  178.  A  contract  to  insure  one  who  cannot  sus- 
tain any  pecuniary  loss  by  the  event  insured  against  is  a  mere  wager  policy, 
and  is  discouraged  by  the  law.  Spare  v.  Home  Mut.  Ins.  Co.,  15  Fed.  Eep.  707  ; 
22  Am.  L.  Reg.  n.  s.  409  ;  12  Ins.  L.  J.  365,  9th  Cir.  (Or.)  1883  ;  American  Bas- 
ket Co.  V.  Farmville  Ins.  Co.,  8  Rep.  744,  4th  Cir.  (Va.)  1879.] 

*  [Pritchet  v.  Ins.  Co.  of  N.  A.,  3  Yeates  (Penn.),  458,  464  ;  Hoit  v.  Hodge, 
6  N.  H.  104,  105.] 
146 


CH.  VI.]  SUBJECT-MATTER.  —  INSUEABLE    INTEREST.         [§  72  B 

of  forty  guineas,  is  a  policy  of  insurance  void  under  the  stat- 
ute, since  plaintiff  has  no  interest  in  the  event.  ^  Where  the 
policy  provided  that  it  should  be  void,  if  the  interest  of  the 
assured  was  other  than  the  sole,  entire,  and  unconditional 
ownership,  unless  so  stated,  it  was  held  avoided  when  tlie 
assured  described  the  property  as  "his,"  but  in  reality  a 
third  party  had  bought  it  under  a  mechanic's  lien  and  placed 
it  in  the  assured's  name  (which  proceeding  was  void),  and 
later  the  third  party  procured  another  title  by  sheriff's  exe- 
cution, and  himself  acted  as  agent  of  assured  to  place  the 
insurance.  The  assured  had  no  interest. ^  A  policy  upon 
the  sex  of  a  person  is  a  wagering  contract  within  the  stat- 
ute of  14  Geo.  III.  cap.  48,  and  void.^] 

[§  75  B.  Wagering  Policies  on  the  event  of  Death  or  3Iar- 
riage  void.  —  Wager  policies  are  void  on  grounds  of  public 
policy.*  A  policy  procured  on  life  of  another  without  in- 
terest in  it  is  void.^  One  cannot  himself  effect  insurance  on 
the  life  of  another  in  which  he  has  no  interest.^  B.  may 
insure  his  own  life  for  C,  but  C.  cannot  insure  B. 's  life 
unless  he  has  a  pecuniary  interest  in  it.''  One  who  has  no 
insurable  interest  in  the  life  of  another  cannot  obtain  mem- 
bership for  the  latter  in  a  mutual  company  so  as  to  gain  in- 
surance upon  his  life.^  In  Mutual  Life  Ins.  Co.  v.  Allen, ^ 
Judge  Allen  said,  "  To  prevent  this  from  being  void,  as  a  mere 
wager  upon  the  continuance  of  a  life  in  which  the  parties  have 
no  interest  except  that  created  by  the  wager  itself,  it  is  neces- 
sary that  the  assured  should  have  some  pecuniary  interest  in 
the  continuance  of  the  life  insured."  To  procure  a  policy  for 
$3,000  to  cover  a  debt  of  -$70  is  of  itself  a  mere  wager.  ^^   An 

1  [Patterson  i^.  Pawell,  9  Bing.  320.] 

2  [Porter  v.  iEtna  Ins.  Co.,  2  Flip.  (U.  S.)  100,  102.] 
8  [Roebuck  v.  Hammerton,  Cowp.  736.] 

*  [White  V.  Equitable  Nuptial  Benefit  Union,  76  Ala.  251.] 

5  [Rombach  v.  Piedmont,  &c.  L.  Ins.  Co.,  35  La.  An.  233.] 

6  [Amick  I'.  Butler,  111  Ind.  578.] 

7  [Bloomington  Mut.  Ben.  Ass.  v.  Blue,  120  111.  121  ;  Martin  v.  Stubbings,  126 
111.  387.] 

8  [Elkhart  Mut.  Aid,  &c.  Ass.  v.  Houghton,  98  Ind.  149.] 

9  [138  Mass.  27.] 

10  [Cammack  v.  Lewis,  15  Wall.  643,  647,  648.] 

147 


§  76]  INSUEANCE :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  VL 

agreement  to  give  defendant  the  exclusive  right  of  carrying 
marriage  benefit  insurance  on  the  plaintiff  is  a  wagering  con- 
tract and  void.i  A  policy  payable  to  the  one  who  holds  the 
next  number  to  the  deceased  is  a  wager  and  illegaL^  A 
policy  taken  out  by  a  man  on  Us  own  life  and  payable  to  any 
one  else  he  may  desire,  is  not  a  wagering  policy,  nor  within 
the  condemnation  of  14  Geo.  III.  cap.  48.  ^(rt)] 

8  76.  What  constitutes  an  Insurable  Interest.  —  As  to  what 
amounts  to  an  insurable  interest  there  has  been  much  dis- 
cussion in  the  courts,  without  hitherto  arriving  at  any  satis- 
factory definition.  It  may  be  said  generally,  however,  that 
while  the  earlier  cases  show  a  disposition  to  restrict  it  to  a 
clear,  substantial,  vested  pecuniary  interest,  and  to  deny  its 
applicability  to  a  mere  expectancy  without  any  vested  right, 
the  tendency  of  modern  decisions  is  to  relax  the  stringency 
of  the  earlier  cases,  and  to  admit  to  the  protection  of  the 
contract  whatever  act,  event,  or  property  bears  such  a  rela- 
tion to  the  person  seeking  insurance  that  it  can  be  said  with 
a  reasonable  degree  of  probability  to  have  a  bearing  upon  his 
prospective  pecuniary  condition.*     An  insurable  interest  is 

1  [James  v.  Jellison,  94  Ind.  294.] 

2  [People  V.  The  Golden  Rule,  &c.,  114  111.  34;  Golden  Kule  v.  The  People, 
118   111.   492. 

8  [North  Amer.  L.  Ass.  Co.  v.  Craigen,  13  Can.  S.  C.  R.  278.] 
*  It  was  said  in  Mitchell  v.  Home  Ins.  Co.,  32  Iowa,  421,  424,  that  whether 
there  is  an  insurable  interest  is  a  question  for  the  jury,  under  proper  instruc- 
tions. But  this,  in  view  of  the  universal  current  of  authorities,  can  only  mean 
that  the  court  are  to  say  that  if  certain  facts  are  found  to  be  true,  then  there  is, 
or  is  not,  as  the  case  may  be,  an  insurable  interest.  In  other  words,  the  facts 
being  proved,  it  is  a  question  of  law  whether  there  arises  out  of  them  an  insurable 
interest. 

(a)   This  statute  is  declarator}''  of  the  a  beneficiary  therein,  the  policy  will  not 

common  law,  and  insurance  secured  by  be  treated  as  a  wager,  if  not  so  intended, 

one  who  has  no  interest  in  the  life  of  Campbell  i'.  New  England  Mut.  Ii.  Ins. 

the  person  assured  is  void  as  a  wager  Co.,  98  Mass.  381  ;  Shea  v.  Mass.  Bene- 

policy.     Whitmore  i;.  Supreme  Lodge,  fit  Ass'n,  160  Mass.  289 ;  Kentucky  L. 

100  Mo.   36,   46  ;   Smith  v.   Pinch,  80  &  A.  Ins.  Co.  v.  Hamilton,  63  Fed.  Rep. 

Mioh.  332.     When,  however,  it  is  made  93.  And  to  an  action  on  a  policy  brought 

to  appear  that  the  person  obtaining  the  by  the  insured's  administrator,  the  fact 

policy  did  so  in  good  faith,  and  not  for  that  the  policy  was  issued  to  a  benefi- 

the  mere  purpose  of  speculating  on  the  ciary  who  |)aid  the  premiums,  but  had 

hazard  of  a  life  in  which  he  has  no  in-  no  insurable  interest,  is  not  a  defence, 

terest,  or  when   one  who  takes  out  a  Brennan   v.   Prudential   Ins.    Co.,    148 

bona-fide  policy  on  his  own  life,  names  Penn.  St.  199. 

148 


CH.  VI.]  SUBJEGT-MATTEK.  —  INSURABLE    INTEREST.  [§  77 

sui  generis,  and  peculiar  in  its  texture  and  operation.  It 
sometimes  exists  where  there  is  not  any  present  property, 
—  any  jus  in  re  or  jus  ad  rem.  Yet  such  a  connection  must 
be  established  between  the  subject-matter  insured  and  the 
party  in  whose  behalf  the  insurance  has  been  effected  as  may 
be  sufficient  for  the  purpose  of  deducing  the  existence  of  a 
loss  to  him  from  the  occurrence  of  an  injury  to  it.i 

[§  76  A.  No  Insurable  Interest.  — The  fact  that  a  turnpike 
company  contributes  to  the  erection  of  a  county  bridge,  gives 
it  no  insurable  interest  therein  in  the  absence  of  proof  that 
the  contribution  was  legally  compulsory. ^  The  owner  of  the 
cargo  of  a  vessel  who  voluntarily  makes  repairs  on  the  ves- 
sel, has  not  an  insurable  interest  in  the  vessel.^  Voluntary 
repairs  belong  to  the  vessel  and  vest  in  its  owner.  If  a  son 
takes  a  policy  on  the  property  of  his  father  upon  a  verbal 
understanding  with  the  father  that  the  money  is  to  be  for 
his  benefit,  the  idea  being  to  protect  the  proceeds  from  the 
father's  creditors,  there  can  be  no  recovery  on  the  policy. 
The  son  cannot  sue,  for  he  had  no  insurable  interest,  and 
the  father  cannot,  for  the  policy  is  limited  to  the  son,  and 
it  is  not  competent  to  prove  the  parol  agreement  that  the 
insurance  was  to  be  for  the  father's  benefit.*  When  the 
policy  purported  to  insure  bills  of  exchange,  which  were  in 
reality  but  rights  to  obtain  money  on  the  contingency  of  the 
arrival  of  a  ship  at  a  certain  place,  and  not  true  bills,  the 
policy  was  held  of  no  avail,  the  subject-matter  not  being 
open  to  insurance.^] 

§  77.  Insurable  Interest  (continued).  —  The  question,  what 
constitutes  an  insurable  interest,  was  much  discussed,  but 
not  decided,  as  long  ago  as  1806,  in  a  noted  case  in  which 
the  several  judges  who  gave  their  opinions  seem  to  have 
given  the  matter  their  careful  consideration.  Their  con- 
flicting views  very  well  illustrate  the  difficulties  of  the  ques- 
tion.    The  facts  in  the  case  were  as  follows :  Certain  ships, 

1  Warren  v.  Davenport  Fire  Tus.  Co.,  31  Iowa,  464,  465. 

2  [Farmers'  Mut.  Ins.  Co.  v.  Turnpike  Co.,  122  Pa.  St.  37,  44.] 
8  [Buchanan  v.  Ocean  Ins.  Co.,  6  Can.  318,  329.] 

4  [Baldwin  v.  State  Ins.  Co.,  60  Iowa,  497.] 
6  [Palmer  v.  Pratt,  9  Moore,  358,  366.] 

149 


§  77]  INSURANCE :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  VI. 

with  their  cargoes,  belonging  to  subjects  of  the  United  Prov- 
inces, by  direction  of  the  admiralty  had  been  seized  by  a 
British  man-of-war  and  ordered  home.  The  defendants  in 
error  were  by  statute  made  commissioners,  with  authority  to 
take  into  their  possession  and  under  their  care,  and  to  man- 
age, sell,  or  otherwise  dispose  of  to  the  best  advantage,  all 
such  ships  and  cargoes  as  had  then  been  or  might  thereafter 
be  detained  in  or  brought  into  the  ports  of  the  United  King- 
dom, and  had  accordingly  insured  these  ships  and  cargoes ; 
but  before  arriving  at  any  port  of  the  United  Kingdom  they 
were  lost.  The  question  was  whether  the  defendants  in 
error  had  an  insurable  interest.  And  it  was  said  on  the 
one  side,  that  though  it  were  conceded  that  the  commis- 
sioners had  no  scintilla  of  right  in  possession  or  reversion, 
yet  they  had  a  contingent  interest  founded  on  the  statute, 
their  commission,  and  the  seizure,  which  made  it  their  duty 
by  all  lawful  means  to  provide  for  the  preservation  of  the 
property  till  they  should  come  into  possession;  that  a  con- 
tingent interest  is  sufficient, ^  and  a  vested  interest  is  not 
necessary;  that  nothing  stood  between  the  commissioners 
and  the  vesting  of  the  contingent  interest  but  the  perils  in- 
sured against,  and,  in  fact,  they  lost  by  the  perils  of  the  sea 
what,  but  for  those  perils,  would  have  vested  in  them  abso- 
lutely; that  though  an  interest  may  be  prevented  from  vest- 
ing by  other  events  than  the  perils  insured  against,  as  by 
the  countermand  of  a  consignor,  yet  this  possibility  of  coun- 
termand will  not  take  away  the  right  from  the  consignee  to 
insure,  and  that  where  there  is  an  expectancy  coupled  with 
a  present  existing  title,  there  is  an  insurable  interest;  that 
inchoate  rights,  such  as  freight,  respondentia,  and  bottomr}', 
and  wages  (though  the  insurance  of  the  latter  is  universally 
prohibited  on  grounds  of  public  policy),  founded  on  subsist- 
ing titles,  lands,  charter-parties,  and  agreements,  are  insur- 
able ;  that  the  object  of  insurance  is  to  protect  men  against 
uncertain  events  which  may  in  any  wise  be  of  disadvantage, 

1  [Though  the  assured's  interest  in  personal  property  is  slight  or  contingent 
yet  if  it  was  fairly  represented  to  the  insurance  company  at  the  time  of  the  con- 
tract, he  may  recover.     Fenn  v.  New  Orleans  Mut.  Ins.  Co.,  .53  Ga  578,  579.] 

150 


CH.  VI.]  SUBJECT-MATTER.— INSURABLE   INTEREST.  [§78 

not  only  those  persons  to  whom  positive  loss  may  come  by 
such  events,  occasioning  the  deprivation  of  that  which  they 
may  possess,  but  those  also  who,   in  consequence  of   such 
events,   may  have  intercepted  from  them  the  advantage  or 
profit    which,    but    for    such    events,    they    would    acquire 
according  to  the  ordinary  and  probable  course  of  things; 
that  though  a  man  must  somehow  or  other  be  interested  in 
the  preservation  of  the  subject-matter  exposed  to  perils,  yet 
to  confine  the  contract  to  the  protection  of  the  interest  which 
arises  out  of  property  is  adding  a  restriction  to  the  contract 
which  does  not  arise  out  of  its  nature ;  that  a  man  is  inter- 
ested in  a  thing,  to  whom  advantage  may  accrue  or  preju- 
dice may  happen  from  the  circumstances  which  may  attend 
it,  and  whom  it  concerneth  that  its  condition  as  to  safety  or 
other  quality  should  continue;  that  interest  does  not  neces- 
sarily imply  a  right  to  the  whole  or  a  part  of  a  thing,  nor 
necessarily  and  exclusively  that  which  may  be  the  subject  of 
privation,  but  the  having  some  relation  to  or  concern  in  the 
subject-matter  of  insurance,   which  relation  or  concern,  by 
the   happening   of   the   perils    insured   against,    may   be   so 
affected   as  to  produce  damage,  detriment,  or  prejudice  to 
the  person  insuring;  and  when  a  man  is  so  circumstanced 
with  respect  to  matters  exposed  to  risks  or  dangers  as  to 
have  a  moral  certainty  of  advantage  or  benefit  but  for  those 
risks  or  dangers,  he  may  be  said  to  be  interested  in  the 
safety  of  the  thing ;  that  to  be  interested  in  the  preservation 
of  a  thing  is  to  be  so  circumstanced  with  respect  to  it  as  to 
have  benefit  from  its  existence  or  prejudice  from  its  destruc- 
tion ;  and  that  the  property  of  a  thing  and  the  interest  deriv- 
able from  it  may  be  very  different,  the  price  being  generally 
the  measure  of  the  first,  while  by  interest  in  a  thing  every 
benefit  and  advantage  arising  out  of  or  depending  on  such 
thing  may  be  considered  as  being  comprehended.^ 

§  78.  On  the  other  hand,  it  was  said  that  the  mere  naked 
expectation  of  acquiring  a  trust  or  charge  respecting  prop- 
erty without  a  scintilla  of  present  interest,  either  absolute 

1  Craufuid  V.  Hunter,  8  T.  R.  13 ;  Lucena  v.  Craufurd,  3  Bos.  &  Pul.  75  i 
8.  c.  H.  of  L.  2  New  Rep.  (5  Bos.  &  Pul.)  299  ;  s.  c.  1  Taunt.  324. 

151 


S  7 


9]  INSURANCE  :  FIRE,  LIFE,   ACCIDENT,   ETC.  [CH.  VI. 


or  contingent,  in  possession,  reversion,  or  expectancy,  in 
the  proper  legal  sense  of  the  word,  can  be  no  foundation  for 
an  insurable  interest;  that  that  intermediate  thing  between 
a  strict  right,  or  a  right  derived  under  a  contract,  and  a 
mere  expectation  or  hope,  which  is  said  to  constitute  an  in- 
surable interest,  and  which  is  sometimes  termed  a  moral 
certainty,  is  so  shadowy  as  to  be  totally  incapable  of  legal 
definition;  that  what  is  the  difference  between  a  moral  cer- 
tainty and  an  expectation  no  one  can  tell;  and  that  in  point 
of  fact  there  can  be  no  insurable  interest  where  there  is  no 
right  in  the  property,  or  a  right  derivable  out  of  the  prop- 
erty by  virtue  of  a  contract  relative  thereto,  which,  in  either 
case,  may  be  lost  upon  some  contingency  affecting  the  pos- 
session or  the  enjoyment  of  the  party  having  the  property  or 
right;  and  that  an  expectation  of  a  grant  or  trust  or  posses- 
sion, founded  upon  great  probability,  is  not  an  insurable  in- 
terest, nor  would  it  be,  whatever  might  be  the  chances  in 
favor  of  the  expectation.  In  other  words,  as  was  tersely 
said  by  Lord  Ellenborough  in  a  subsequent  case  while  dis- 
cussing the  same  question,  "a  man  has  no  right  to  an 
indemnity  because  he  has  lost  the  chance  to  receive  a 
gift."i 

§  79.  Expected  Profits.  — Expected  profits  may  be  insured  ^ 
both  in  this  country  and  England,  though  the  rule  in  France 
is  different,  where  only  an  acquired  profit  may  be  insured. 
But  the  insured  must  have  an  interest  in  the  property  out  of 
which  the  profits  are  expected  to  proceed,  and  the  profits 

^  Ibid.  ;  Roiitli  v.  Thompson,  11  East,  428.  In  this  discussion  were  engaged 
on  one  side  or  on  the  other,  most  of  the  judges  of  the  different  courts,  and 
amongst  them  some  of  the  ablest  that  ever  adorned  the  British  judiciary  ;  and 
in  its  different  stages  the  cause  will  be  found  to  be  an  invaluable  storehouse  oi 
learning  upon  this  much-vexed  question  of  insurance  law,  which  will  abundantly 
reward  the  most  careful  perusal.  See  also  De  Forest  v.  Fulton  Fire  Ins.  Co., 
1  Hall  (N.  Y.  Superior  Ct.),  84.  The  question  was  also  much  discussed  in  the 
recent  English  case  of  Ebsworth  v.  Alliance  Ins.  Co.,  8  L.  R.  (C.  P.)  596,  in 
which  the  court  unanimously  agreed  that  a  consignee  might  insure  and  recover 
to  the  amount  of  his  advances  ;  but  were  equally  divided  upon  the  point  whether, 
insuring  for  himself  and  other  parties  in  interest,  he  could  recover  beyond  his 
interest,  —  upon  which  latter  point  the  authorities  in  this  country  are  decidedly 
in  the  affirmative.     Shaw  v.  Mina.  Ins.  Co.,  49  Mo.  578  ;  post,  §  424. 

2  [Eyre  v.  Glover,  16  East,  218,  220.] 

152 


CH.  VI.]  SUBJECT-MATTER. — INSURABLE    INTEREST.  [§80 

must  be  insured  as  profits. ^  "It  is  not  necessary,"  says 
Alauzet,2  "to  the  validity  of  the  contract  that  the  thing 
exist,  and  that  the  interest  be  born  at  the  moment  of  the 
making  of  the  contract.  Thus  crops  may  be  validly  insured 
against  hail  and  frost  or  any  other  risk,  even  before  they  are 
sown ;  but  from  the  moment  when  the  crop  begins  to  take 
root  or  branch,  the  contract  will  be  perfect  and  suscep- 
tible of  execution.  Until  then  it  is  only  a  conditional  in- 
surance. "^  (a)  And  such  expected  profits  are  still  insurable 
though  the  insured  may  have  no  absolute  ownership  in  the 
property  out  of  which  the  profits  are  expected  to  arise,  but 
merely  a  right,  if  he  should  so  elect,  to  take  it  on  certain 
terms  and  conditions,  in  a  certain  event;  as  where  one  pur- 
chases for  a  consideration,  then  paid,  the  right  to  take  a 
portion  of  a  cargo  expected  to  arrive,  on  the  payment  of  a 
certain  further  sum,  if  on  the  arrival  he  shall  so  elect. ^  But 
though  there  be  an  ownership  in  the  property,  if  before  it 
comes  to  the  possession  of  the  purchaser  he  becomes  insol- 
vent, and  the  goods  are  intercepted  by  the  vendor  by  right 
of  stoppage  in  transitu,  there  being  no  longer  either  property 
or  any  expectation  of  profits  thereon,  there  can  be  no  recov- 
ery under  the  policy.^ 

§  80.  Insurable  Interest,  who  may  have.  —  Whoever  may 
fairly  be  said  to  have  a  reasonable  expectation  of  deriving 
pecuniary  advantage  from  the  preservation  of  the  subject- 
matter  of  insurance,  whether  that  advantage  inures  to  him 
personally  or  as  the  representative  of  the  rights  or  interests 
of  another,  has  an  insurable  interest.  Thus  a  mortgagee, 
being  the  owner  of  a  limited  interest  in  the  estate,  has  in 

1  Sun  Fire  Office  v.  Wright,  3  N.  &  M.  819  ;  s.  c.  1  A.  &  E.  621  ;  Barclay  v. 
Cousins,  2  East,  544  ;  Grant  v.  Parkinson,  Park,  402 ;  s.  c.  Marsh.  Ins.  95 ;  Put- 
nam V.  Mercantile  Ins.  Co.,  5  Met.  386,  391  ;  Loomis  v.  Shaw,  2  Johns.  Cas.  36  ; 
Niblo  V.  N.  A.  Fire  Ins.  Co.,  1  Sandf.  (N.  Y.  Superior  Ct.)  551  ;  Leonarda  v.  Phcenix 
Assurance  Co.,  2  Rob.  (La.)  131.    [Abbott  v.  Sebor,  3  Johns.  Cas.  (N.  Y.  39,  44.]) 

2  Traite  Gen.  des  Assurances,  153  ;  Pardessus,  Droit  Com.,  589. 

3  Grant  v.  Parkinson,  3  Bos.  &  Pul.  85  n. 

4  French  v.  Hope  Ins.  Co.,  16  Pick.  397. 

5  Clay  V.  Harrison,  10  B.  &  C.  99. 

{a)  See  Barry  v.  Farmers  Mut.  Hail  Ins.  Ass'n  (Iowa),  81  N.  W.  690  ;  Holmes 
V.  Phenix  Ins.  Co.,  98  Fed.  Rep.  240. 

153 


§  80]  INSURANCE :   FIRE,   LIFE,   ACCIDENT,  ETC.  [CH,  VI. 

his  own  right  an  insurable  interest  to  the  amount  of   the 
morto-ao-e  debt^     So  have  executors  an  insurable  interest  in 
the  property  of  the  testator  which  the  executor  is  bound  to 
protect; 2  and  admiimtrators  in  the  like  property  of  the  in- 
testate, ^  even  though,  it  seems,  the  personal  assets  are  suffi- 
cient to  pay  the  debts;*  and  trustees  in  property  under  their 
charge;^   and  sheriffs  in  property  attached. ^     So  also  have 
consignees,  common  carriers,  and  supercargoes,  under  instruc- 
tions to  land  the  goods  and  wait  for  a  market,^  or  when  com- 
pensation depends  upon  the  safety  of  the  cargo  ;S  captors, 
having  a  well-founded  expectation  that  their  claim  will  be 
allowed ;  ^  and  pledgees,  innkeepers,  factors,   common  carriers, 
wharfingers,  pawnbrokers,  warehousemen,   and,  generally,  per- 
sons charged  either  specially,  by  law,   custom,  or  contract, 
with  the  duty  of  caring  for  and  protecting  property  in  be- 
half of  others,  or  having  a  right  so  to  protect  such  property, 
though  not  bound  thereto  by  law,  or  who  will  receive  benefit 
from  the  continued  existence  of  the  property,  whether  they 
have  or  have  not  any  title  to  estate  in  lien  upon  or  posses- 
sion of  it,  have  an  insurable  interest. ^"^     That  the  person  may 
suffer  loss  is  a  sufficient  foundation  for  his  claim  to  an  in- 
surable interest.  ^1     Indeed,  the   law  has  gone  very  near  to 


1  Carpenter  v.  Prov.  AVashington  Ins.  Co.,  16  Pet.  (IT.  S.)  495  ;  Kellar  v. 
Merchants'  Ins.  Co.,  7  La.  An.  29  ;  Addison  v.  Kentucky,  &c.  Ins.  Co.,  7  B. 
Men.  (Ky.)  470. 

2  Phelps  V.  Gebhard  Fire  Ins.  Co.,  9  Bosw.  (N.  Y.  Superior  Ct.)  404. 

3  Herkimer  v.  Kice,  27  "N.  Y.  163.     See  aho  post,  §  448. 

4  Globe  Ins.  Co.  v.  Boyle,  21  Ohio  St.  119. 

5  Insurance  Co.  v.  Chase,  5  Wall.  (U.  S.)  509;  Babson  v.  Thomaston  Mut. 
Fire  Ins.  Co.,  C.  Ct.  (Me.),  Shepley,  J.,  4  Ins.  L.  J.  50. 

6  White  V.  Madison,  26  N.  Y.  117. 

T  De  Forest  v.  Fulton  Fire  Ins.  Co.,  1  Hall  (N.  Y.),  84,  a  case  full  of  learning. 
Waters  v.  Monarch  Fire  &  Life  Ins.  Co.,  6  El.  &  Bl.  870;  ^Etna  Ins.  Co.  v. 
Jackson,  16  B.  Mon.  (Ky.)  242  ;  Planters'  Mut.  Ins.  Co.  v.  Engle  (Md.),  9  Ins. 
L.  J.  71. 

8  Robinson  v.  New  York  Ins.  Co.,  2  Caines  (N.  Y.),  357  ;  ante,  §78,  note. 

9  Stockdale  v.  Dunlop,  6  Mees.  &  Wels.  224  ;  Protection  Ins.  Co.  v.  Hall,  15 
B.  Mon.  (Ky.)  411. 

"  Eastern  K.  R.  Co.  v.  Relief  Fire  Ins.  Co.,  98  Mass.  420  ;  Shaw  v.  Mtna. 
Ins.  Co.,  49  Mo.  578;  Commonwealth  v.  Hide  &  Leather  Ins.  Co.,  112  Mass. 
136  ;  Sturm  v.  Atlantic  Mut.  Ins.  Co.,  63  N.  Y.  77.     And  see  post,  §§  89,  90.       . 

u  Cone  V.  Niagara  Ins.  Co.,  60  N.  Y.  619. 

154 


CH.  VI.]  SUBJECT-MATTER.  —  INSURABLE    INTEREST.  [§  81 

holding  a  lawful  possession  to  be  an  adequate  interest  to 
support  the  contract.  ^ 

§  81.  Divers  Interests  in  same  Subject-matter.  —  Many  are 
the  rights  giving  an  insurable  interest  which  different  par- 
ties may  have  in  the  same  subject-matter.  Of  course  the 
owner  in  fee  of  real  estate  may  insure,  and  his  interest  not 
only  continues  after  a  mortgage,  but  it  even  survives  a  sale 
of  the  equity  of  redemption  on  execution  until  his  right  to 
redeem  under  that  sale  expires. ^  In  personal  as  well  as  real 
property  there  is  an  insurable  interest  while  there  is  any 
right  to  redeem. 3  So  may  the  owner  of  a  leasehold  estate 
insure,^  especially  if  he  own  the  building  ;5  so  may  a  hus- 
band as  tenant  by  the  curtesy,  after  issue  born  alive,  though 
the  wife  be  only  a  joint  tenant  ;S  and  so,  too,  if  he  lives  with 
his  wife,  and  shares  with  her  the  use  of  her  own  separate 
personal  or  real  property.'^  [In  some  states,  however,  the 
husband  cannot  insure  his  wife's  property,  having  no  inter- 

1  Sutherland  v.  Pratt,  11  Jlees.  &  Wels.  296  ;  Barclay  v.  Cousins,  2  East, 
544;  Wilson,  J.,  Sherboneau  v.  Beaver  Mut.  Fire  Ins.  Ass.,  30  U.  C.  (Q.  B.) 
472.     See  also  pos;;,  §§  89,  97  ;  Durand  v.  Thouron,  1  Port.  (Ala.)  238,  251. 

2  Strong  V.  Manufacturers'  Ins.  Co.,  10  Pick.  (Mass.)  40  ;  Columbian  Ins. 
Co.  V.  Lawrence,  2  Pet.  (U.  S.)  25  ;  Stephens  v.  Illinois  Mut.  Fire  Ins.  Co.,  43 
111.  327  ;  post,  §  82. 

3  Allen  V.  Franklin  Fire  Ins.  Co.,  9  How.  Pr.  (N.  Y. )  501  ;  Franklin  Ins.  Co. 
V.  Findlay,  6  Whart.  (Pa.)  483. 

*  Sadlers'  Co.  v.  Badcock,  1  Wil.  10  ;  s.  c.  2  Atk.  554  ;  Niblo  v.  North  Ameri- 
can Ins.  Co.,  1  Sandf.  (N.  Y.  Superior  Ct.)  551. 

a  Fletcher  w.  Commonwealth  Ins.  Co.,  18  Pick.  (Mass.)  419;  Laurent  v.  Chat- 
ham Fire  Ins.  Co.,  1  Hall  (N.  Y.),  41  ;  Tongue  v.  Nutwell,  31  Md.  302. 

6  Franklin  Mar.  &  Fire  Ins.  Co.  v.  Drake,  2  B.  Mon.  (Ky.)  47  ;  Abbott  v. 
Hampden  Mut.  Fire  Ins.  Co.,  30  Me.  414;  Harris  v.  York  Mut.  Ins.  Co.,  50  Pa. 
St.  341.  And  see  also  Curry  v.  Commonwealth  Ins.  Co.,  10  Pick.  (Mass.)  535. 
[A  husband  who  has  curtesy  in  property  has  an  insurable  interest  therein. 
Franklin  Ins.  Co.  v.  Drake,   2  B.   Mon.   (Ky.)   47,  50.] 

7  Goulstone  v.  P.oyal  Insurance  Co.,  1  Fost.  &  Fin.  (N.  P.)  276  ;  Clarke  v. 
Fireman's  Insurance  Co.,  18  La.  431  ;  American  Central  Insurance  Co.  v.  Mc- 
Jjanathan,  11  Kans.  533.  [A  husband  who  with  his  wife  is  in  the  possession 
and  enjoyment  of  her  personal  property,  and  has  real  estate  in  which  he  has 
an  inchoate  curtesy,  has  an  insurable  interest  in  the  same.  Trade  Insurance 
Co.  V.  BarraclifF,  45  N".  J.  543.  Also,  an  insolvent  retains  an  insurable  interest 
in  goods  concealed  from  his  creditors.  Goulstone  v.  Royal  Insurance  Co.,  1  F.  & 
F.  276,  279.  When  a  husband  insures  his  wife's  separate  property  as  his  own, 
he  must  in  his  declaration  aver  loss  of  his  right  to  use,  or  he  cannot  recover,  and 
his  policy  must  insure  his  interest  and  not  the  property  which  was  not  his, 
Cohn  V.  Virginia  F.  &  M.  Insurance  Co.,  3  Hughes  (U.  S.),  272,  273.] 

155 


§81]  insurance:   fire,  life,  accident,  etc.  [CH.  VI. 

est  in  it.^ (a)]  A  tenant  in  dower  may  doubtless  insure.  [A 
homestead  may  be  insured  by  the  head  of  the  family.  2  (5)] 
So  the  assignee  of  a  bond  for  a  deed  of  real  estate  upon 
which  the  obligee  has  made  improvements  has  an  insurable 
interest.^  A  disseisor  may  be  considered  as  the  owner,  so 
far  as  to  give  him  an  insurable  interest,  especially  if  the 
disseisee's  right  of  entry  is  tolled;  for  if  the  disseisee  has 
no  right  to  enter,  but  only  a  right  of  action,  he  is  not  the 
absolute  owner'of  the  land, — the  disseisor  is  the  owner 
under  a  title  which  is  defeasible.*  Rent  is  itself  a  distinct 
insurable  interest,  and  is  not  a  proper  item  of  loss  to  en- 
hance the  damages  under  a  policy  insuring  the  building.^ 
[A  tenant  in  common  may  insure  his  own  interest,  and  is 
not  accountable  to  his  co-tenants  for  any  portion  of  the  in- 

1  [A  husband  has  no  insurable  interest  in  property  of  his  wife  conveyed  to 
her  by  him.  Clark  v.  Dwelliug-House  Ins.  Co.,  81  Me.  373.  So  in  Indiana  the 
law  has  deprived  a  husband  of  all  right  to  the  possession  or  control  of  his 
wife's  separate  estate,  and  he  therefore  has  no  insui'able  interest  in  her  prop- 
erty. Traders'  Ins.  Co.  v.  Newman,  120  Ind.  554.  And  in  Michigan  a  husband 
cannot  in.sure  in  his  own  name  the  personal  property  of  his  wile,  and  the  policy 
will  be  void  even  though  the  company  knew  the  facts  at  its  inception.  Agri- 
cultural Ins.  Co.  V.  Montague,  38  Mich.  548,  551.  The  doctrine  of  waiver 
cannot  apply.  It  is  fundamental  that  the  assured  must  have  an  insurable  inter- 
est, and  it  is  immaterial  that  he  acted  in  good  faith.] 

2  [German-Amer.  Ins.  Co.  v.  Davidson,  67  Ga.  11.  The  husband  has  an  in- 
surable interest  in  a  homestead  occupied  by  himself  and  his  wife,  owned  by  her 
and  on  land  in  which  she  has  a  life  estate.  Merrett  v.  Farmers'  Ins.  Co.,  42 
Iowa,  11,  14.  Where  a  husband  orally  gave  a  homestead  to  his  wife,  on  leav- 
ing her,  and  she  occupied  the  same  and  with  her  own  money  erected  buildings 
thereon,  she  has  an  insurable  interest  in  the  homestead.  Rockford  Ins.  Co.  v. 
Nelson,  65  111.  415,  420.] 

8  Ay  res  v.  Hartford  Fire  Ins.  Co.,  17  Iowa,  176. 

*  Curry  r.  Commonwealth  Ins.  Co.,  10  Pick.  (Mass.)  535. 

6  Leonarda  v.  Phcenix  Assurance  Co.  of  London,  2  Rob."  (La. )  131.  In  Mc- 
Cormick  y.  Terrier,  Hayes  &  J.  (Irish  Exch.)  12,  a  verdict  was  upheld  for  the 
whole  amount  claimed,  where  suit  was  brought  by  two  parties  holding  distinct 
interests  in  the  same  subject-matter,  alleging  generally  that  they  had  an  interest, 
but  not  alleging  it  to  be  either  sole  or  joint.  But  see  Ebsworth  v.  Alliance  Mar, 
Ins.  Co.,  8  L.  R.  (C.  P.)  596. 

(a)  See  Trott  v.  Woolwich  F.  Ins.  wholly  in  the  wife,  the  husband's  inter- 
Co.,  83  Maine,  362  ;  Horsch  v.  Dwell-  est  therein  is  sufficient  to  support  an 
ing-House  Ins.  Co.,  77  Wis.  4  ;  Diflfen-  action  by  them  jointly  on  a  fire  policy 
baugh  V.  Union  F.  Ins.  Co.,  150  Penn.  issued  to  them  both.  Webster  v. 
St-  270.  Dwelling-House  Ins.  Co.,  53  Ohio  St. 

(b)  When  the  title  to  a  dwelling  558.  See  Glaze  v.  Three  Rivers  Far- 
occupied    as    a    family    homestead    is  mers'  M.  F.  Ins.  Co..  87  Mich.  349. 

156 


CH.  VI.]  SUBJECT-MATTER.  —  INSURABLE   INTEREST.  [§  82 

surance  money.  ^]  The  same  person  may  hold  several  inter- 
ests by  distinct  rights. ^  Thus  he  may  have  co-existing 
interests  as  owner,  as  trustee,  as  executor,  as  legatee,  and 
as  surety.  And  the  failure  of  one  interest  does  not  affect 
the  others.^ 

§82.  Mortgagor  and  Mortgagee;  Pledgor;  Pledgee;  Guar- 
antor; Surety;  Hirer.  — A  pledgor  of  goods  as  collateral  has 
an  insurable  interest.^  So  has  a  cestui  que  trust ;^  and  so 
has  a  mortgagor,^  even  though  his  equity  has  been  foreclosed, 
so  long  as  the  mortgage  debt  remains  unpaid,  on  account  of 

1  [Annely  v.  DeSaussure,  26  S.  Car.  .505.  In  this  case  the  whole  of  the  insur- 
ance money  was  applied  in  repairing  the  property.] 

2  [A  person  having  several  interests  in  the  same  cargo  may  protect  them  all 
under  one  policy  without  expressing  their  different  natures.  Carruthers  v. 
Sheddon,  6  Taunt.  14,  18.] 

8  Insurance  Cos.  v.  Thompson,  95  U.  S.  547  ;  7  Ins.  L.  J.  1. 

*  [If  a  pledgor  of  property  is  in  possession,  and  its  loss  would  leave  him  still 
liable  on  the  debt,  he  has  an  insurable  interest  to  the  full  value  of  the  property. 
Nussbaum  v.  Northern  Ins.  Co.,  37  Fed.  Rep.  524  (Ga.)  1889.] 

6  Butler  V.  Standard  Fire  Ins.  Co.,  4  U.  C.  (App.)  391. 

6  [A  mortgagor  to  full  value  has  still  an  insurable  interest.  Higginson  v. 
Dall,  13  Mass.  96,  101.  As  the  loss  of  mortgaged  property  diminishes  the 
mortgagor's  means  of  payment,  it  cannot  be  said  that  a  mortgage  lessens  his  in- 
surableinterest.  Guest  v.  Fire  Ins.  Co.,  6Q  Mich.  98.  The  owner  of  the  equity 
of  redemption  has  an  insurable  interest  equal  to  the  value  of  the  property,  even 
though  the  mortgage  would  absorb  the  whole  of  it.  The  embarrassment  of  a 
man's  affairs  may  be  "such  as  to  cover  all  he  owns  with  debts,  but  he  has  not 
therefore  lost  interest  in  his  property.  Insurance  Co.  v.  Stinson,  103  U.  S.  25, 
29  (1880).  If  the  property  were  destroyed  the  debts  would  remain,  and  the 
debtor  would  be  poorer  by  just  the  value  of  the  property  lost.  It  has  been  held 
that  a  mortgage  large  enough  to  absorb  the  value  of  the  buildings  does  not  destroy 
the  insurable  interest  of  the  owner,  even  though  he  is  not  personally  liable  on  the 
mortgage  debt.  The  interest  arises  from  his  ownership  and  his  right  to  redeem. 
Insurance  Co.  v.  Stinson,  103  U.  S.  25,  29.  But  it  is  a  little  difficult  to  see  what 
substantial  interest  the  mortgagor  can  have  in  the  preservation  of  the  property 
under  such  circumstances,  and  that  is  the  true  test.  A  mortgagor  who  has  given 
a  bond  with  the  mortgage,  and  afterward  sold  the  property,  has  still  an  insurable 
interest  in  its  preservation,  in  order  that  the  debt  may  be  paid  out  of  it.  Waring 
V.  Loder,  53  N.  Y.  581,  585.  An  equity  of  redemption  before  foreclosure  is  an 
insurable  interest.  Creighton  v.  Homestead  F.  Ins.  Co.,  17  Hun,  78,  80.  The 
mortgagor  of  a  vessel,  who  has  warranted  to  keep  her  insured  for  the  mortgagee, 
has  an  insurable  interest  therein  which  is  not  destroyed  by  a  subsequent  forfeiture 
for  violation  of  a  coasting  act.  Wilkes  v.  People's  F.  Ins.  Co.,  19  N.  Y.  184,  187. 
The  insurable  interest  of  a  mortgagor  is  not  divested  by  an  unauthorized  fore- 
closure sale  and  confirmation  which  is  afterwards  set  aside.  Even  though  the 
loss  occur  after  the  confirmation,  and  before  it  is  vacated,  the  mortgagor  may  re- 
cover.    Insurance  Co.  v.  Sampson,  38  Ohio  St.  672.] 

157 


§  82]  INSURANCE  :   FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  VI. 

his  liability  therefor,^  and  so  long  as  there  are  facts  and 
equities  in  the  case  which  might  give  a  right  of  redemption 
notwithstanding  the  foreclosure. ^  And  one  who  has  con- 
veyed away  his  property  to  protect  another  against  loss  by 
reason  of  liability  on  account  of  the  pledgor  or  guarantor 
has  an  insurable  interest  certainly  before  any  claim  on  the 
liability  has  accrued,  and,  no  doubt,  if  such  claim  has  not 
accrued,  as  he  stands  substantially  in  the  position  of  a  mort- 
rao'or.^  So  where  one  indorses  a  note  for  the  accommoda- 
tion  of  the  maker,  with  the  agreement  that  the  proceeds  of 
the  goods  for  which  the  note  was  given  shall  be  paid  to  him, 
the  indorser,  with  which  to  pay  the  note,  he  has  an  insurable 
interest*  So  where  one  becomes  liable  on  a  bond  for  the 
payment  of  taxes  on  the  property  insured,^  So  where  the 
plaintiff  had  made  advances  from  time  to  time  for  building 
a  vessel,  under  a  parol  agreement  that  he  might  hold  and 
sell  the  vessel  to  pay  his  advances,  paying  a  surplus  to  the 
borrower,  though  he  never  had  possession  of  the  vessel,  nor 
any  bill  of  sale  or  transfer,  he  was  held  to  have  an  insurable 
interest.^  So  the  holder  of  a  mortgage  as  collateral  secur- 
ity for  a  debt  has  an  insurable  interest  in  the  mortgaged 
property,  while  the  debt  for  which  the  mortgage  is  pledged 
as  collateral  remains  unpaid.'''  Successive  mortgagees,  hold- 
ing claims  upon  the  same  property  at  the  same  time,  may 

1  Buffalo  Steam-Eugine  Works  v.'  Sun  Mut.  Ins.  Co.,  17  N.  Y.  401  ;  ante, 
§  81  ;  Parsons  v.  Queen  Ins.  Co.,  29  U.  C.  (C.  P.)  188.  As  to  the  law  in  Iowa, 
see  post,  §  286. 

2  Stephens  v.  Illinois  Mut.  Fire  Ins.  Co.,  43  111.  327  ;  Cone  v.  Niagara  Fire 
Ins.  Co.,  60  N.  Y.  619. 

8  Smith  V.  Royal  Ins.  Co.,  27  U.  C.  (Q.  B.)  54  ;  Kronk  v.  Birmingham  Ins. 
Co.  (Pa.),  9  Ins.  L.  J.  26;  Walsh  v.  Fire  Association,  127  Mass.  383  ;  Kelly  v. 
Liverpool,  &c.  Ins.  Co.,  2  Hannay  (N.  B.),  266. 

*  Davies  v.  Home  Ins.  Co.,  3  IJ.  C.  (App.)  269,  reversing  s.c.  24  U.  C.  (Q.  B.) 
364.  [A  surety  for  the  payment  of  the  value  of  the  cargo  of  a  vessel  in  case  of 
condemnation  of  the  ship,  to  whom  the  cargo  had  been  delivered  as  indemnity, 
has  an  insurable  interest  in  the  cargo,  just  as  a  factor  who  has  a  lien  on  goods  in 
his  possession  has.     Russel  v.  Union  Ins.  Co.,  1  Wash.  409,  412.] 

6  Insurance  Co.  v.  Thompson,  95  U.  S.  547. 

6  Clark  V.  Scottish  Imp.  Ins.  Co.,  4  Can.  Sup.  Ct.  Rep.  192,  reversing  s.  c.  2 
P.  &  B.  (N.  B.)  241.     See  §  93. 

7  Sussex  County  Mut.  Fire  Ins.  Co.  v.  WoodrufT,  2  Dutch.  (N.  J.)  541  ; 
Mechler  v.  Phoenix  Ins.  Co.,  38  Wis.  665  ;  ante,  §  80. 

158 


CH.  YI.]  SUBJECT-MATTER.  —  INSURABLE    INTEREST.  [§  83 

each  insure  their  respective  interests.^     [The  hirer  of  a  ves- 
sel may  insure  her.^] 

§  83.  Mortgagee ;  Creditor.  —  The  amount  of  interest  or 
its  character  is  not  material  in  determining  the  question 
whether  a  party  who  attempts  to  recover  under  a  policy  has 
an  insurable  interest.  A  mortgagee's  interest,  as  we  have 
already  seen,  in  the  protection  of  the  property  as  a  fund  out 
of  which  to  pay  the  debt,  is  undoubtedly  insurable;^  and  he 
does  not  lose  that  insurable  interest,  although  he  sell  and 
assign  the  mortgage  and  the  note  thereby  secured,  if  he  in- 
dorse the  note.  His  responsibility  for  the  debt  remaining, 
he  is  still  interested  in  the  preservation  of  the  property,  out 
of  which  to  pay  what  has  ceased  to  be  a  debt  due  him  in- 
deed, but  nevertheless  a  debt  due  another,  which  he  has 
assumed  in  a  certain  contingency  to  pay.*  [A  trustee  under 
a  deed  of  trust  in  the  nature  of  a  mortgage  has  an  insurable 
interest  distinct  from  that  of  the  mortgagor.^  When  the 
assured  described  the  premises  as  "my  house,  &c.,"  —  when, 
in  fact,  the  owner  had  assigned  the  property  to  him  m  trust 
to  sell  and  pay  the  creditors,  the  assured  being  one  of  the 
latter,  it  was  held  that  the  beneficial  interest  of  the  assured 
entitled  him  to  recover  the  whole  insurance,^  at  least  where 
his  beneficial  interest  is  enough  to  cover  it  all.]  And  a 
creditor  has  an  insurable  interest  in  the  real  estate  of  his 
insolvent  or  intestate  debtor  if  the  personal  assets  are  insuf- 
ficient to  pay  the  debts.  ^  [A  judgment  creditor  may  insure 
property  he  has  attached,  and  apply  the  proceeds  to  his  own 
use.^     He  has  also  a  general  insurable  interest  in  the  prop- 

1  Fox  V.  Phenix  Fire  Ins.  Co.,  52  Me.  333. 

2  [Bartlet  v.  Walter,  13  Mass.  267,  269.] 

8  [Under  the  act  of  1881,  44  &  45  Vict.  c.  41,  a  mortgagee  may,  after  the  date 
of  the  mortgage,  insure  any  part  or  the  whole  of  the  mortgaged  property,  and  the 
premiums  shall  be  a  charge  on  the  property  in  addition  to  the  mortgage,  with  the 
same  priority,  and  with  interest  at  the  same  rate.] 

*  New  England  Fire  &  Mar.  Ins.  Co.  v.  Wetmore  et  al.,  32  111.221  ;  Williams 
V.  Roger  Williams  Ins.  Co.,  107  Mass.  377. 

5  [Dick  V.  Franklin  F.  Ins.  Co.,  81  Mo.  103.] 

«  [White  V.  Hudson  Riv.  Ins.  Co.,  7  How.  Pr.  341,  350.] 

''  Rohrbach  v.  Germania  Fire  Ins.  Co.,  62  N.  Y.  47  ;  Herkimer  v.  Rice,  27  id. 
163. 

8  [International  Trust  Co.  v.  Boardman,  149  Mass.  158.] 

159 


§  83  a]        INSURANCE :  fire,  life,  accident,  etc.         [ch.  VI. 

erty  of  his  debtor,  but  he  cannot  recover  from  the  insurer 
unless  he  shows  that  the  debtor  has  not  sufficient  property 
left  out  of  which  the  judgment  can  be  satisfied.  ^  (a)] 

§  83  a.  Vendor  and  Vendee  ;  Without  Delivery.  —  The  pur- 
chaser of  a  number  of  barrels  of  oil  stored  with  others,  but 
not  separated  or  identified,  has  an  insurable  interest  to  the 
amount  of  goods  of  the  character  claimed  shown  to  have 
been  in  the  building  at  the  time  of  the  fire.^     So  has  the 

1  [Spare  v.  Home  Mut.  Ins.  Co.,  15  Fed.  Kep.  707  ;  8  Sawy.  618  ;  16  Cent. 
L.  J.  3.^j2  ;  12  Ins.  L.  J.  365,  9th  Cir.  (Or.)  ;  see  contra,  §  93.] 

2  Mathewson  v.  Royal  Ins.  Co.,  16  L.  C.  Jur.  (Q.  B.)  45  ;  Wilson  v.  Citizens' 
Ins.  Co.,  19  id.  175  ;  Clark  v.  Western  Ass.  Co.,  25  U.  C.  (Q.  B.)  209.  The  con- 
trary was  held,  by  a  divided  court,  as  to  the  purchaser  of  an  unseparated  lot  of 
wheat  in  another  court.     Box  v.  Provincial  Ins.  Co.,  15  Grant,  Ch.   337,   552, 


(n)  See  Bnrlingame  v.  Goodspeed, 
153  Mass.  24  ;  Tilley  v.  Conn.  F.  Ins. 
Co.,  86  Va.  811.  When  a  creditor  in- 
sures his  debtor's  life  to  secure  his  debt, 
the  amount  of  his  insurable  interest  is 
the  amount  of  the  debt ;  the  proof  of 
indebtedness  must  be  distinct  and  satis- 
factory, but  if  there  is  a  close  or  even 
reasonable  equality  between  the  amount 
due  the  creditor,  including  premiums 
and  expenses  paid,  and  the  face  of  the 
policy,  it  is  not  a  wager  or  speculative 
risk.  Warnock  v.  Davis,  104  U.  S. 
775  ;  Crotty  v.  Union  Mut.  L.  Ins.  Co., 
144  U.  S.  621;  Givens  v.  Veeder  (N. 
Mex.),  50  Pac.  316.  In  determining 
whether  such  insurance  is  a  wager,  the 
debtor's  expectancy  of  life,  according  to 
the  Carlisle  Tables,  may  properly  be 
considered.  Ulrich  v.  Reinoehl,  143 
Penn.  St.  238  ;  Shaffer  v.  Spangler,  144 
id.  223  ;  McHale  v.  McDonnell,  175  id. 
632.  In  Ulrich  v.  Reinoehl,  Si^jura,  it  was 
held  that  a  policy  for  $3000  to  cover  a 
debt  of  $100,  may,  as  matter  of  law,  be 
declared  a  wager,  when  no  explanation 
is  given  for  such  apjiarent  disproportion. 

A  creditor's  insurable  interest  in  his 
debtor's  life  is  only  for  indemnity  and 
cannot  exceed  the  indebtedness  secured, 
including,  if  so  agreed,  the  expenses  of 
the  insurance.  Exchange  Banku.  Loh, 
104  Ga.  446.  But  such  insurable  inter- 
est supports    the  policv,   though    the 

160 


creditor's  claim  is  satisiied  before  the 
debtor's  death.  Manhattan  L.  Ins.  Co. 
1).  Hennessy,  99  Fed.  Eep.  64.  But 
such  interest  is  only  vital  to  the  insurer, 
and  if  it  does  not  object,  its  absence  is 
by  estoppel  not  fatal  as  between  the  as- 
signor and  the  assignee,  or  between  dif- 
ferent claimants.  Robinson  v.  Hurst, 
78  Md.  59  ;  Hewinsu.  Baker,  161  Mass. 
320;  Hall  v.  Niagara  F.  Ins.  Co.,  93 
Mich.  184  ;  Hogue  u.  Minnesota  Packing 
Co.,  59  Minn.  39  ;  Blackburn  v.  St. 
Paul  F.  &  M.  Ins.  Co.,  116  N.  C.  821  ; 
Dixon  V.  National  L.  Ins.  Co.,  168 
Mass.  48  ;  Merrill  v.  Colonial  M.  F.  Ins. 
Co.,  169  Mass.  10.  An  insured  cred- 
itor's interest  ceases  when  his  claim  is 
paid,  and  the  policy  then  belongs  to 
the  insured's  estate.  Crotty  v.  Union 
M.  L.  Ins.  Co.,  144  U.  S.  621  ;  see 
Hicks  V.  National  L.  Ins.  Co.,  60  Fed. 
Rep.  690.  A  policy' for  the  benefit  of  a 
creditor,  "  as  his  interest  ma}' appear," 
relates  to  his  interest  as  creditor,  and 
not  in  the  insured  property  ;  if  that 
interest  is  equal  to  or  exceeds  the  amount 
insured,  he  can  sue  upon  the  policy  in 
his  own  name,  even  though  he  ceases  to 
have  an  insurable  interest.  Donaldson 
V.  Ins.  Co.,  95  Tenn.  280.  Creditors 
have  no  interest  in  a  fraternal  benefit 
certificate  the  proceeds  of  which  belong 
wholly  to  the  designated  beneficiary. 
Fisher  v.  Donovan,  57  Neb.  361. 


CH.  VI.]  SUBJECT-MATTER.  — INSUEABLE   INTEREST.  [§  83  a 

transferee  for  value  of  a  warehouseman's  receipt  for  a  cer- 
tain amount  of  wheat  not  separated  from  a  larger  amount.  ^ 
A  vendor  of  personal  or  real  property,  though  he  may  have 
contracted  to  sell  the  same,  has  also  an  insurable  interest.^ 
So  has  a  vendee  in  possession,  under  a  contract  that  the 
property  shall  be  his  when  the  note  given  for  the  property 
is  paid,  and  until  then  shall  remain  the  property  of  the 
vendor,  before  the  note  is  paid.^  When  a  vendee  institutes 
proceedings  for  abrogating  a  contract  of  sale,  and  insures 
pending  those  proceedings,  he  has  an  insurable  interest,  and 
may  recover  although  the  loss  does  not  happen  till  the  con- 
tract is  abrogated.  Before  the  abrogation,  it  is  his  interest 
to  protect  for  himself,  and  after  the  abrogation  it  is  both 
his  interest  and  duty  to  protect,  so  that  he  may  restore  and 
place  the  vendor  in  substantially  the  same  position  as  he 
was  in  before  the  sale.  The  effect  of  the  abrogation  of  the 
contract  was  to  subrogate  the  vendor  to  the  assured 's  right 

citing  Sutherland  v.  Pratt,  11  M.  &  W.  296,  where  it  was  held  that  the  vendee 
of  goods  under  a  verbal  contract  could  not  insure.     See  also  fost,  §  97. 

1  Todd  V.  Liverpool,  &c.  Ins.  Co.,  18  U.  C.  (C.  P.)  192.  Though  this  case 
was  reversed  afterwards  on  appeal,  four  to  three,  it  was  for  reasons  drawn  from 
statutory  considerations,  which  do  not  seem  to  affect  the  soundness  of  the  general 
principle  decided  in  the  case  reversed. 

2  McSwiney  v.  Royal  Exch.  Ass.  Co.,  14  Q.  B.  634  ;  Acer  v.  Merchants'  Ins. 
Co.,  57  Barb.  (N.  Y.)  68  ;  Brewer  v.  Herbert,  30  Md.  301.  [A  vendor  who  has 
agreed  to  sell  for  full  value  has,  pending  the  contract  of  sale,  a  right  to  insure  the 
premises.  Gill  v.  Can.  F.  &  M.  Ins.  Co.,  1  Ont.  R.  347.  The  owner  of  a  vessel, 
who  has  contracted  to  sell  her,  has  still  an  insurable  interest  in  her,  to  her  full 
value :  Stuart  v.  Columbian  Ins.  Co.,  2  Cranch  C.  C.  442,  443  ;  and  not  merely 
to  the  price  agreed  on.  A  vendor,  V.,  who  has  supplied  T.  with  goods  under  an 
agreement,  reserving  to  V.  a  special  property  in  them,  has  an  insurable  inten-st, 
and  a  verdict  in  his  favor  will  not  be  set  aside  because  he  said  on  cross-examina- 
tion that  if  the  goods  had  been  destroyed  without  insurance  the  loss  would  have 
fallen  on  T.  Such  an  answer  is  only  V.'s  idea  of  the  legal  effect  of  the  agreement. 
Rumsey  v.  Merch.  M.  Ins.  Co.,  4  Russ.  &  Geld.  (Nova  Sco.)  220.  An  executory 
contract  to  sell  40,000  hams,  to  be  paid  for  on  delivery,  does  not  change  the 
property,  and  the  vendor  by  a  policy  insuring  the  stock  of  which  the  hams  were 
a  part,  insures  them  also,  and  may  recover  therefor  upon  loss.  iEtna  Ins.  Co.  v. 
Jackson,  16  B.  Mon.  242,  267.  The  vendor  of  goods,  having  received  the  price 
therefor,  and  agreed  to  store  them  free  of  charge  and  to  procure  insurance  in  the 
name  of  the  vendee,  stating  all  the  facts  to  the  rmderwriters,  may  so  insure, 
although  the  goods  have  not  been  separated  from  others  of  the  kind  in  the  vendor's 
stock.     Cumberland  Bone  Co.  v.  Andes  Ins.  Co.,  64  Me.  466,  470.] 

3  Holbrook  v.  St,  Paul  Fire  &  Mar.  Ins.  Co.,  25  Minn.  229.  See  also  Bick- 
nell  V.  Lancaster  Fire  Ins.  Co.,  58  IST.  Y.  677. 

VOL.  I.  -11  161 


§  84]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  VI. 

to  the  proceeds.  1  A  vendor  of  real  estate,  after  articles  of 
agreement  and  before  conveyance,  may  also  insure  the  full 
value;  and  when  the  policy  is  upon  the  buildings  and  not 
upon  the  debt,  the  insurance  is  prima  facie  upon  the  whole 
legal  and  equitable  interest,  and  upon  the  balance  of  the 
unpaid  consideration. ^  (a) 

S  84.  Lessor  and  Lessee.  —  The  interest  of  a  lessee  is  based 
upon  his  right  to  the  possession  and  use,  his  liability  to  re- 
pair or  for  waste,  or  his  covenant  or  parol  agreement  ^  to 
keep  insured,  and  may  exist  whether  he  be  tenant  for  years 
or  at  will.  But  the  lessee  cannot  insure  lessor's  interest, 
unless  under  obligation  so  to  do.*  In  England  the  incum- 
bent of  a  benefice,  and  generally  the  tenants  of  ecclesiastical 
property,  whether  in  possession  or  not,  and  other  persons 
bound  by  custom  or  otherwise  to  repair,  are  considered  to 
have  an  insurable  interest.^  A  sub-lessee  by  parol,  who 
rents  a  building  on  the  leased  land,  has  an  insurable  inter- 
est in  the  building.^  [The  lessee  of  a  homestead  who  has 
erected  improvements  has  an  insurable  interest] 

And  it  seems  that  a  possession  under  such  circumstances 
that  the  tenant  may  be  liable  as  a  wrong-doer  gives  an  in- 
surable  interest,   as   appears   by   the   following   interesting 

1  Le  Soleil  v.  Alby,  Dalloz,  Jur.  Gen.,  Ct.  of  Cass.  1868,  1,  38.  See  also  post, 
§89. 

2  Insurance  Co.  v.  Updegraff,  21  Pa.  St.  513. 

8  Lawrence  v.  St.  Mark's  Fire  Ins.  Co.,  43  Barb.  (N.  Y.)  479. 
*  Hidden  v.  Slater  Fire  Ins.  Co.,  2  Clifford  (C.  Ct),  266,  268. 

5  Bnnyon,  Fire  Ins.,  17. 

6  Mitchell  V.  Home  Ins.  Co.,  32  Iowa,  421  ;  Fowle  v.  Simngfield,  &c.  Ins.  Co., 
122  Mass.  191.  In  Kelley  v.  Insurance  Co.,  Dist.  Ct.,  Phila.,  3  Bennett  Fire  Ins. 
Cases,  Sharswood,  J.,  held  that  property  held  by  a  tenant  was  in  trust,  so  that 
if  the  policy  required  property  held  in  trust  to  be  insured  as  such,  an  insurance 
by  the  tenant  in  his  own  name  would  be  invalid.  The  case  does  not  show  what 
the  subject-matter  of  insurance  was. 

T  [Creech  v.  Richards,  76  Ga.  36.] 

(a)  One  who  is  in  possession  of  realty  Phcenix  Ins.  Co.,  Ill  Cal.  409;  Baker 

under  a  contract  to  buy  it,  and  who,  v.  State  Ins.  Co.,  31  Oregon,  41  ;  Lov- 

having  made  part  payments,  is  entitled  enthal  v.  Home  Ins.  Co.,   112  Ala.  108. 

to  a  conveyance  upon  full  payment,  has  He  has  also  an  insurable  interest  in  any 

an  insurable  interest  to  the  extent  of  building  or  structures  he  may  be  erect- 

the  payments  made  up  to  the  time  when  ing  on  the  land.     Hall  v.  Niagara  F. 

the  insurance  was  effected.     Davis  v.  Ins.  Co.,  93  Mich.  184. 

162 


CH.  VI.]  SUBJECT-MATTER.  —  INSURABLE   INTEREST.  [§85 

case :  The  City  of  New  York  had  leased  a  plot  of  ground  for 
the  Crystal  Palace  building  to  an  association  which  failed, 
and  a  receiver  was  appointed  by  the  court  under  the  statute 
relating  to  the  dissolution  of  corporations.  The  receiver 
held  possession  of  the  property  some  year  and  a  half  after 
the  lease  expired,  when  the  plaintiffs  entered  by  force  and 
took  possession,  and  then  procured  this  insurance.  The 
court  observed  that  if  the  building  was  to  be  considered  as 
the  property  of  the  lessee  at  the  termination  of  the  lease,  the 
plaintiffs  were  liable  to  be  charged  for  its  value  as  wrong- 
doers, at  the  suit  of  the  receiver,  after  they  had  forcibly 
ejected  him  and  taken  possession  thereof.  The  plaintiffs 
were  in  possession  under  a  claim  of  ownership.  The  re- 
ceiver can  maintain  no  action  to  recover  the  actual  posses- 
sion of  the  building  since  its  destruction,  and  a  recovery 
against  the  plaintiffs  for  the  value,  by  way  of  damages, 
would  vest  the  ownership  in  them,  even  though  they  acquired 
no  title  in  it  by  the  conditions  of  the  lease  and  the  expira- 
tion of  the  terra.  And  so  on  this  ground  there  was  an  in- 
surable interest.  1  So,  too,  a  landlord  has  an  insurable 
interest  in  the  goods  of  his  tenant  liable  to  distress  for 
rent.  2 

§  85.  Lessor ;  Buildings  erected  by  Lessee.  —  Of  COUrse, 
when  a  building  is  erected  by  the  lessee,  and  reverts  to  the 
lessor  at  the  expiration  of  the  lease,  an  insurable  interest 
exists  in  the  lessor  from  the  time  of  the  reversion.^  So  if 
the  lessee  has  a  right  to  remove  the  buildings  at  the  expira- 
tion of  the  lease,  as  their  destruction  will  diminish  the  les- 
sor's security  for  rent,  he  may  insure  for  his  protection.^ 

1  Mayor,  &c.  of  New  York  v.  Brooklyn  Fire  Ips.  Co.,  41  Barb.  (N.  Y.)  231. 

^  Columbia  Ins.  Co.  i-.  Cooper,  50  Pa.  St.  3-31. 

8  Mayor,  &c.  of  New  York  v.  Exchange  Fire  Ins.  Co.,  9  Bosw.  (N.  Y.)  424  ; 
s.  c.  affirmed,  3  Abb.  App.  Dec.  (N.  Y.)  261  ;  Mayor,  &c.  of  New  York  v.  Brook- 
lyn Ins.  Co.,  41  Barb.  (N.  Y.)  231. 

*  Miltenberger  v.  Beacom,  9  Pa.  St.  198.  In  Macarty  .  Commercial  Ins. 
Co.,  17  I-a.  365,  it  is  said  that  a  donor  who  has  given  a  deed  of  his  property  inter 
vivos,  and  at  the  delivery  of  the  deed  has  by  parol  agreed  with  the  donees  that 
he  shall  retain  the  estate  during  his  life,  and  does  in  fact  retain  it,  taking  the 
profits  and  paying  taxes  and  making  repairs,  has  no  insurable  interest.  But 
the  reasoning  of  the  court  is  wholly  unsatisfactory,  and  the  decision  is  against 
the  universal  current  of  the  modern  authorities, 

163 


§  87]  INSURANCE  :   FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  VI. 

8  86.  Equitable  Title.  —  There  can  be  no  doubt  that  one 
who  has  a  title  enforceable  in  equity  has  an  insurable  inter- 
est. ^  So  where  the  plaintiff  advanced  money  to  a  builder, 
and  took  his  notes,  secured  by  a  deed  in  trust  to  a  third 
party,  in  payment,  and,  the  maker  of  the  notes  being  unable 
to  pay  them  at  maturity,  it  was  agreed  that  the  plaintiff 
should  surrender  the  notes  and  take  possession  of  the  prop- 
erty, which  he  accordingly  did,  with  the  assent  of  the  trus- 
tee, who  delivered  to  him  the  deed  of  trust,  which  at  the 
time  insurance  was  effected  he  had  so  held  for  about  two 
years,  it  was  held  that  he  had  an  insurable  interest.  ^ 

§87.  Possession;  Incomplete  Title;  Claim  in  Litigation.  — 
But  insurable  interest  does  not  at  all  depend  upon  the  com- 
pleteaess  or  validity  of  the  title  by  which  the  insured  prop- 
erty is  held.  Thus  possession  under  a  contract  of  sale,  upon 
which  partial  payment  has  been  made,  may  give  an  insur- 
able interest,  although  the  conditions  of  the  contract  have 
been  so  far  violated  that,  if  the  breach  be  insisted  on,  the 
contract  cannot  be  enforced,  since  the  contract,  notwith- 
standing the  breach  of  its  conditions,  may  be  carried  into 
effect  by  the  parties  in  interest.^  And  this  is  true,  though 
the  vendor,  availing  himself  of  the  violation  of  the  condi- 
tions by  the  vendee,  has  resold  the  property,  and  is  resist- 
ing a  proceeding  in  equity  brought  by  the  vendee  to  compel 

1  Ramsey  v.  Phcenix  Ins.  Co.,  2  Fed.  Rep.  429  ;  Redfield  v.  Holland,  &c.  Ins. 
Co.,  56  N.  Y.  354  ;  Franklin  Fire  Ins.  Co.  v.  Martin  (Md.),  8  Ins.  L.J.  134  ;  Acer 
V.  Merchants'  Ins.  Co.,  57  Barb.  (N.  Y.)  68.  See  also  post,  §§  87,  88,  96  ;  Brewer 
V.  Herbert,  30  Md.  301.  [An  equitable  interest  is  a  proper  subject  of  insur- 
ance. Hume  V.  Providence  Washington  Ins.  Co.,  23  S.  Car.  190  ;  Home  Protec- 
tion Ins.  Co.  V.  Caldwell  Bros.,  85  Ala.  607.  One  who  has  an  equitable  interest 
in  property  may  insure  the  same  in  the  name  of  the  legal  holder,  the  proceeds 
to  be  payable  to  himself  as  his  interest  may  appear,  and  on  loss  he  may  recover 
the  amount  of  his  damage,  not  exceeding  the  amount  of  his  insurance.  Harvey  v. 
Cherry,  12  Hun,  354,  356.  An  equitable  title  or  interest  such  as  possession 
under  a  contract  of  purchase  is  sufficient.  Oilman  v.  Dwelling-House  Ins.  Co., 
81  Me.  488.     See  next  section.] 

2  Coursin  i-  Pa.  Ins.  Co.,  46  Pa.  St.  323. 

8  Tyler  v.  Mtna.  Fire  Ins.  Co.,  16  Wend.  (N.  Y.)  385 ;  s.  c.  12  id.  507  ;  Co- 
lumbian  Ins.  Co.  v.  Lawrence,  2  Pet.  (U.  S.)  25  ;  s.  c.  10  id.  507  ;  McOivney  v. 
Phrenix  Fire  Ins.  Co.,  1  Wend.  (N.  Y.)  85  ;  Smith  v.  Bowditch  Ins.  Co.,  6  Cush. 
(Mass.)  448  ;  Southern  Ins.  &  Tr.  Co.  v.  Lewis,  42  Oa.  587  ;  Pettigrew  v.  Grand 
River  Farmers'  Ass.,  28  U.  C.  (C.  P.)  70. 

164 


CH.  VI.]  SUBJECT-MATTEE.  —  INSUKABLE   INTEKEST.        [§  87  A 

a  conveyance.  If  this  were  not  so,  the  property  might  be 
destroyed  pending  the  litigation,  to  the  prejudice  of  the 
vendee  should  he  ultimately  prevail.  ^ 

[§  87  A.  Contract  of  Purchase  ;  Claim  of  Title  ;  Defect  in 
Title.  —  The  holder  of  an  assigned  title  bond  has  an  insur- 
able interest  in  the  premises. ^  "Possession  of  property 
under  a  subsisting  executory  contract  that  may  ripen  into 
ownership  constitutes  an  insurable  interest,  whether  the 
purchase-money  is  paid  or  not,  and  will  justify  a  recovery, 
to  the  extent  of  injury  sustained. "  One  who  has  a  bond  of 
conveyance  of  a  ship,  from  the  builders,  on  payment  of  the 
balance  of  the  cost,  and  who  has  the  sole  use  of  her,  may  in- 
sure freight  in  her,  and  may  represent  himself  as  the  sole 
owner  to  the  underwriters.  ^  One  who  holds  goods  under 
contract  of  purchase  has  an  insurable  interest  to  the  amount 
already  paid  by  him.*  One  in  possession  of  land  under  a 
contract  of  purchase,  having  made  a  part  payment,  has  an 
insurable  interest.^  And  more  broadly,  a  person  in  posses- 
sion  of  land,  as  owner,  under  a  valid  and  subsisting  contract 
for  the  purchase,  has  an  insurable  interest  therein.^  And 
further,  one  in  possession  of  lands  under  a  contract  to  pur- 
chase may  describe  them  as  his,  in  a  policy ;  and  this  is  not 
affected  by  the  fact  that  he  was  at  the  time  in  default 
through  the  breach  of  a  condition,  if  the  vendor  had  not 
taken  advantage  of  the  same  and  declared  the  contract  for- 
feited.^ Even  after  an  agreement  to  rescind  the  contract  of 
purchase,  the  insurable  interest  remains  until  the  rescission 
is  consummated.^  One  in  possession  under  a  bona  fide  claim 
of  title  is  not  affected  as  to  insurance  by  a  defect  in  the 

1  Milligan  v.  Equitable  Ins.  Co.,  16  IT.- C.  (Q.  B.)  314.     See  also  Sherboneau 
V.  Beaver  Mut.  Ins.  Ass.,  30  id.  472  ;  ante,  §  83  a. 

2  [Ayres  v.  Hartford  Ins.  Co.,  17  Iowa,  176,  181.] 

3  [Simmes  v.  Marine  Ins.  Co.,  2  Cranch  C.  C  618,  620.] 

*  [Michael  v.  St.  Louis  Mut.  Fire  Ins.  Co.,  17  Mo.  App.  23.] 

5  [Grange  Mill  Co.  v.  Western  Ass.  Co.,  118  111.  396  ;  iEtna  Ins.  Co.  v.  Tyler, 
16  Wend.  385,  396.] 

6  [Tuckernian  v.  Home  Ins.  Co.,  9  E.  I.  414,  417  ;  Ramsey  v.  Phoenix  Ins. 
Co.,  2  Fed.  Rep.  429  ;  17  Blatch.  527,  2d  Cir.  (N.  Y.)  1880.] 

^  [Pelton  v.  Westchester  Fire  Ins.  Co.,  77  N.  Y.  605,  608.] 
8  [MacCutcheon  v.  Ingraham,  19  Ins,.L.  J.  32  (W.  Va.),  1889.] 

165 


§  88]  insurance:  fike,  life,  accident,  etc.         [ch.  VI. 

title.  1  When  the  assured  got  his  title  to  the  property  in- 
sured by  a  fraud  as  to  the  consideration  of  the  deed,  it  was 
held  that  ho  nevertheless  had  an  insurable  interest,  as  the 
conveyance  to  him  was  not  void  but  only  voidable.'^  Where 
the  assured  produced  a  deed  conveying  to  him  "a  certain 
mill  site  and  all  the  buildings  thereunto  belonging,"  it  was 
held  that  the  insurer  could  not  show  that  the  grantors  of  the 
assured  had  only  a  right  of  easement  in  the  property.  ^  One 
in  possession  under  claim  of  right,  no  adverse  interest  hav- 
ing been  asserted,  is  the  owner.  But  where  the  insured 
holds  only  under  a  parol  agreement  of  a  married  woman  to 
convey,  which,  by  the  law  of  the  State  is  invalid,  he  has  no 
insurable  interest*  One  not  in  possession,  claiming  by 
conveyances  to  and  by  a  fictitious  person,  has  no  insurable 
interest.  Such  a  deed  is  not  sufficient  to  raise  a  presump- 
tion of  possession.^] 

§  88.  Purchase  at  Auction  before  Payment ;  Fraudulent  Con- 
veyance. —  And  it  has  been  held  in  Tennessee  that  this  in- 
terest exists  under  the  following  state  of  facts :  The  plaintiff 
had  purchased  the  property  at  a  sale  on  execution.  He  had 
neither  paid  the  purchase-money  nor  any  part  thereof,  nor 
had  he  received  or  been  tendered  a  deed.  Some  arrange- 
ment was  made  with  the  creditors  for  time,  and  there  was 
some  understanding  with  the  execution  debtor  that  he  was 
to  hold  the  property  as  security  for  the  amount  bid,  and 
other  debts  for  which  the  plaintiff  was  liable  to  him.  After 
the  loss,  the  plaintiff  being  still  delinquent  in  the  payment 
of  the  purchase-money,  the  property  was  re-sold  to  another 
person.^  So  both  the  vendor  and  vendee,  under  a  convey- 
ance which  is  fraudulent  as  against  creditors,  have  insurable 
interests.' 

1  [Travis  v.  Continental  Ins.  Co.,  32  Mo.  App.  198.] 

2  [Phcenix  Ins.  Co.  v.  Mitchell,  67  111.  43,  45.] 

8  [Miller  v.  Alliance  Ins.  Co.,  19  Blatch.  (U.  S.)  308,  311.] 
*  [Perry  v.  Mechanics'  Mut.  Ins.  Co.,  11  Fed.  Eep.  478  ;  11  Ins.  L.  J.  409,  1st 
Cir.  (i;.  I.)  1882.] 

5  I  David  V.  Williamsbnrgh  City  Fire  Ins.  Co.,  7  Abb.  N.  C.  47.] 

6  iEtna  Ins.  Co.  v.  Miers,  5  Sneed  (Tenn.),  139. 

7  Lerovv  v.  Wilraarth,  9  Allen  (Mass.),  382  ;  Pettigrew  v.  Grand  River,  &c., 
28  U.  C.  (C.  P.)  70. 

166 


CH.  VI.]  SUBJECT-MATTER.  —  INSURABLE   INTEREST.  [§90 

§  89.  Intruder.  —  It  has  been  held,  however,  that  when  a 
person  is  a  mere  intruder,  and  has  no  license  or  permission 
to  occupy  land  belonging  to  another,  he  can  have  no  insur- 
able interest  in  buildings  which  he  may  erect  thereon. 
Thus,  certain  parties  jointly  agreed  to  build  a  hotel  on  the 
beach  on  land  belonging  to  the  State,  without  lease  or  other 
permission.  The  plaintiff,  one  of  the  corporation,  con- 
tracted with  the  rest  to  build  the  house,  and  by  virtue  of 
the  contract  became  a  creditor  of  the  company.  After  it 
was  built,  several  of  the  joint  proprietors  being  unable  to 
pay,  their  interest  was  transferred  to  the  plaintiff,  who 
thenceforth  for  two  or  three  years  used  and  occupied  the 
premises,  and  at  length  procured  insurance  thereon.  But 
the  court  said  they  had  no  rights  individually  or  collec- 
tively ;  they  were  mere  intruders,  and  had  no  interest  which 
the  law  could  in  any  way  recognize. ^ 

§  90.  stockholder  in  Corporate  Property.  —  Philips  V.  KnOX 
County  Mutual  Insurance  Company  ^  has  been  regarded  as  an 
authority  that  the  stockholder  of  an  incorporated  company 
has  no  insurable  interest,  though  he  own  all  the  stock  of 
the  company ;  though  the  real  question  in  this  case  seems  to 
have  been  whether  the  stockholder  truly  represented  the  title 
when  he  stated  that  the  property  was  his,  the  insurers  by 
their  charter  being  entitled  to  a  lien,  and  whether  the  in- 
sured was  the  owner  in  fee,  in  which  case  only  the  insurance 
was  to  be  binding,  (a)  But  in  Warren  v.  Davenport  Fire 
Insurance  Company, ^  the  point  was  distinctly  made,  and  de- 
cided in  the  affirmative.*     Upon  full  consideration  the  court 

1  Sweeny  v.  Franklin  Ins.  Co.,  20  Pa.  St.  337. 

2  20  Ohio,  174,  178. 
8  31  Iowa,  464. 

■1  [A  stockholder  in  a  private  company  has  an  insurable  interest  in  the  cor- 
porate property.     Seaman  v.  Enterprise,  &c.  Co.,  18  Fed.  Rep.  250,  8th  Cir.  (Mo.) 

(a)   In  New  York  a  stockholder  in  a  creditor  and  stockholder  of  the  insured 

corporation  is  held  to  have  an  insurable  company,  "as  his  interest  may  appear," 

interest  in  the  corporate  property.    Riggs  this  clause  refers,  not  to  the  appointee's 

V.  Commercial  Mut.  Ins.  Co.,  125  N.  Y.  interest   in  the  property,  but  to  his  in- 

7.     When  the  property  insured  belongs  terest  as  such  creditor  and  stockholder. 

to  a  corporation,  but  the  loss  is  made  Donaldson  v.  Ins.  Co.,  95  Tenn.  280. 
payable  to   a  third  person,  who   is  a 

167 


§  92]  insurance:  fire,  life,  accident,  etc.         [ch.  VI. 

held  that  a  stockholder  is  clearly  interested  in  the  preserva- 
tion of  the  property  which  gives  value  to  his  stock,  and  out 
of  which  come  the  dividends,  and  that  the  interest  is  of  such 
a  nature  as  to  be  insurable.  The  court  refer  to  the  Ohio 
case  just  cited,  and,  after  pointing  out  the  fact  that  the  case 
turned  upon  the  provision  of  the  charter  making  the  policy 
void  if  the  true  title  be  not  stated,  well  observe  that  a  mort- 
gagee who  had  represented  the  property  as  his  own  would 
have  failed  in  the  same  case,  and  for  the  same  reason. 

§  91.    Administratrix.  —  An    administratrix    was   held   to 
have  an  insurable  interest  under  the  following  state  of  facts : 
The  husband  before  his  death  agreed  with  the  defendants  for 
a  policy  upon  his  building  and  machinery.      Before,  how- 
ever,  the  policy  was  issued   he  died,    and  the  policy  was 
afterwards  issued  insuring  his  "estate."     In  a  suit  brought 
on  the  policy  assigned  after  the  loss,  and  brought  by  the 
assignee,  it  was  contended,  on  the  part  of  the  defendants, 
that  the  "  estate  "  of  the  husband  meant  his  administratrix, 
and  that  she  as  such  administratrix  had  no  interest  in  the 
realty.     But  the  court  said  it  was  apparent  that  both  par- 
ties intended  that  the  building  as  well  as  the  machinery 
should  be  insured,  for  so  expressly  said  the  policy ;  and  as 
the  heirs  had  the  chief  interest  in  the  real  estate,  it  might 
fairly  be  presumed,  without  the  aid  of  extraneous  evidence, 
that  such  insurance  was  effected  for  their  benefit.     If,  how- 
ever, this  were  ^oubtful,  extraneous  evidence  might  be  ad- 
duced to  ascertain  in  all  cases  of  ambiguity  in  this  respect 
what  interests  were  intended  to  be  insured.  ^     So  a  widow 
who  is  in  possession  of  her  deceased  husband's  house  built 
on  land  of  which  he  was  tenant  for  years,  and  had  paid  the 
ground  rent,  has  an  insurable  interest  both  as  presumptive 
owner  of  the  house  and  as  administratrix  de  son  tort.^ 

§  92.    Insolvent.  —  Insolvent  debtors   and  bankrupts  may 

1883.  A  shareholder  in  the  Atlantic  Telegraph  Co.,  whose  shares  were  dependent 
upon  the  success  of  the  cable  to  England,  had  an  insurable  interest  in  the  venture. 
Wilson  V.  Janes,  2  L.  R.  Exch.  Div.  139,  148.] 

1  Clinton  v.  Hope  lus.  Co.,  51  Barb.  (N.  Y.)  647  ;  s.  c.  affirmed,  45  N.  Y.  544. 
See  also  post,  §  445. 

^  Linglcv  V.  Queen's  Ins.  Co.,  1  Hannay  (N.  B.),  280. 
168 


CH.  VI.J  SUBJECT-MATTER.  — INSURABLE   INTEEEST.  [§93 

also  have  an  insurable  interest.  Thus,  an  insolvent,  having 
obtained  his  discharge,  acquired  property  and  insured  it. 
Subsequently,  and  after  the  loss,  the  creditors  discover  that 
the  discharge  was  obtained  by  fraud,  and  upon  proper  pro- 
ceedings had  in  court  the  discharge  was  revoked.  Under 
the  English  insolvent  law  all  the  property  which  the  insol- 
vent has  at  the  time  of  filing  his  petition,  and  all  which  he 
shall  acquire  before  he  becomes  entitled  to  his  discharge, 
vests  in  his  assignee.  ^  It  was  contended  that  as  the  order 
for  the  insolvent's  discharge  had  been  annulled,  he  was  in 
the  same  position  as  if  the  discharge  had  never  been  granted, 
and  consequently  the  assignee  was  entitled  to  the  property 
in  question,  and  might  compel  the  insurance  company  to  pay 
the  loss  to  him.  A  party  who  insures,  it  was  contended, 
must  have  a  real  and  tangible,  and  not  a  merely  speculative, 
interest  in  the  property  insured.  But  by  Pollock,  C.  B.  : 
"It  is  enough  if  he  is  responsible  to  some  person  for  the 
property.  There  are  many  cases  on  marine  policies  which 
show  that  if  a  person  can  be  called  upon  to  account  for  prop- 
erty he  has  an  insurable  interest  in  it."  And  per  Alderson, 
B.  :  "The  insolvent  having  possession  of  the  property  is 
responsible  for  it  to  his  assignee.  Then  why  may  he  not 
insure  it  ? "  After  advisement,  it  was  held  that,  as  the  in- 
solvent was  in  possession  as  the  apparent  owner,  responsible 
to  those  who  were  the  real  owners,  he  might  insure. ^  And 
the  insurable  interest  remains  even  though  the  insolvent  has 
concealed  his  goods  from  his  creditors.^ 

§  93.  Lien.  —  Where  by  statute  the  mechanic  has  a  lien 
for  labor  and  materials  furnished  in  the  erection  of  a  build- 
ing, he  has  an  insurable  interest  in  the  building.*  The  lien 
attaches  from  the  commencement  of  the  labor  and  the  fur- 
nishing the  materials.  Nor  is  it  necessary  that  the  validity 
of  the  lien  should  have  in  any  way  been  brought  to  judicial 
cognizance.      Before   judgment,   and  even  before  filing  the 

1  1  &  2  Vict.  c.  110,  §  37. 

2  Marks  v.  Hamilton,  7  Wels.  Hurl.  &  Gor.  (Exch.)  323. 
8  Goulstone  i-.  Royal  Ins,  Co.,  1  F.  &  F.  (N.  P.)  276. 

*  [Insurance  Co.  v.  Stiiisou,  103  U.  S.  25.] 

169 


§  93  A]         INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  VI. 

claim,  if  the  period  within  which  the  claim  must  be  filed 
has  not  transpired,  the  interest  subsists.  ^  And  it  has  been 
intimated  that  a  contractor  would  have  an  insurable  interest 
in  the  house  he  was  engaged  in  building,  irrespective  of  his 
statutory  lien,  if  his  compensation  in  any  way  depended 
upon  the  completion  of  the  house ;  or,  in  other  words,  if  by 
contract  or  custom  he  was  not  to  be  paid  till  the  house  was 
finished.'^  So  the  lien  given  for  money  advanced  for  repairs 
and  supplies  to  a  ship  constitutes  an  insurable  interest. ^ 
But  a  general  lien,  like  that  of  a  judgment  in  some  States, 
where  by  law  it  is  a  lien  first  upon  the  personal  estate  of 
the  judgment  debtor,  and  then  upon  his  real  indiscrimi- 
nately, docs  not  give  an  insurable  interest  in  the  whole  or 
any  part  of  the  debtor's  property  to  the  judgment  creditor, 
and  in  this  respect  is  to  be  distinguished  from  a  mortgage, 
which  is  a  specific  pledge  of  definite  property,  and  gives  the 
mortgagee  an  insurable  interest.^ 

[§  93  A.  A  Lien  or  Interest  in  yiature  of  a  Lien  is  insurable.^ 
—  One  having  a  lien  on  a  vessel  has  an  insurable  interest  in 
it.^  One  having  goods  consigned  to  him  as  part  security 
for  a  debt,  has  an  insurable  interest  therein."  An  equitable 
lien  for  advances  based  on  an  agreement  to  put  the  property 
in  my  hands  for  sale,  so  that  I  may  reimburse  myself  out  of 
the  proceeds,  is  an  insurable  interest,  and  though  the  vessel 
burns  before  it  is  finished  and  put  in  my  possession,  yet  I 
can  recover.^  Advances  made  in  a  foreign  port  to  equip  a 
vessel  and  procure  for  her  a  cargo  are  a  lien,  and  constitute 
an  insurable  interest  in  the  ship.^     One  in  possession  of  real 

1  Franklin  Fire  Ins.  Co.  v.  Coates,  14  Md.  285  ;  Carter  v.  Humboldt  Fire  Ins. 
Co.,  12  Iowa,  287;  Stout  v.  City  Fire  Ins.  Co.,  id.  371  ;  Longhurst  v.  Star  Ins. 
Co.,  19  id.  36i. 

2  Protection  Ins.  Co.  v.  Hall,  15  B.  Mon.  (Ky.)  411. 

3  Merchants'  Mutual  Ins.  Co.  v.  Baring,  20  Wall.  (U.  S.)  159. 

*  Greveineyer  v.  Southern  Mut.  Ins.  Co.,  62  Pa.  St.  (P.  F.  Smith,  12)  340. 
See  contra,  §  83,  note. 

6  [Hancox  v.  Fishing  Ins.  Co.,  3  Sum.  (U.  S.)  132,  139.] 
«  [Marine  Ins.  Co.  v.  Winsmore,  124  Pa.  St.  61.] 
T  [Wells  V.  Phila.  Ins.  Co.,  9  S.  &  R.  103,  108.] 
8  [Clarke  v.  Scottish  Imp.  F.  Ins.  Co.,  4  Can.  Supr.  Ct.  R.  192.] 
»  [Insurance  Co.  v.  Baring,  20  Wall.  159,  162.] 
170 


CH.  VI.]  SUBJECT-MATTER.  —  INSURABLE   INTEREST.       [§  94  A 

estate  under  a  power  of  attorney  to  sell  it  to  cover  advances 
made  to  the  owner  may  insure  it.^] 

§  94.  Liability  for  Loss.  —  In  Maine,  Massachusetts,  and 
probably  other  States,  railroads  are  by  statute  given  an  in- 
sura))le  interest  in  buildings  and  other  property  along  the 
line  of  the  road,  for  the  loss  of  which  by  fire  communicated 
from  the  engine  they  would  be  responsible.^  The  interest 
here  is  analogous  to  that  of  the  common  carrier,  who  is  an 
insurer  by  the  common  law,  or  to  that  of  an  underwriter, 
who  is  an  insurer  by  contract;^  and  being  a  different  inter- 
est from  that  of  ownership,  should  be  so  insured.*  Such 
insurable  interest  has  been  held  to  exist  in  growing  timber 
located  at  a  distance  of  three  hundred  feet  from  the  line  of 
the  road,^  or  even  half  a  mile  distant,  where  the  fire  start- 
ing in  the  grass  adjacent  to  the  road  extends  continuously  to 
the  wood.^ 

[§94  A.  — Neither  legal  nor  equitable  interest  in  property 
is  necessary  to  support  insurance  upon  it;  "it  is  enough  if 
the  assured  is  so  situated  as  to  be  liable  to  loss  from  its 
destruction."^  In  this  case  the  C.  Company  insured  N. 
against  loss  of  royalties  on  patents  that  might  occur  by  the 
stoppage  of  the  manufactories  of  E.  &  Co.,  who  paid  to  N. 
royalties  on  certain  goods  made  by  them.  If  a  diminution 
of  the  royalties  was  caused  by  fire  damage  to  the  factories, 
the  C.  Company  was  to  pay  the  amount  of  such  diminution 
to  N.  The  facts  of  the  case  do  not  seem  to  warrant  the 
principle  announced  by  the  court,  that  no  legal  or  equitable 
interest  is  necessary  to  support  insurance.  The  iuHurance 
ivas  not  upon  the  factories  hut  upon  the  royalties.  It  was 
against  loss  of  the  royalties  by  a  particular  cause.  A  fire 
might  greatly  damage  the  factories,  yet  if  it  did  not  result 

1  [Brugger  v.  State  Investment  &  Ins.  Co.,  7  Rep.  616;  5  Sawyer,  304.] 

2  Chapman  v.  Atlantic  &  St.  Lawrence  R.  R.  Co.,  37  Me.  92  ;  Hart  v. 
Western  R.  R.  Co.,  13  Met.  (Mass.)  99  ;  Hooksett  v.  Concord  R.  R.-  Co.,  38 
N.  H.  242. 

3  Eastern  R.  R.  Co.  v.  Relief  Fire  Ins.  Co.,  98  Mass.  420. 

*  Monadnock  R.  ZX.  Co.  v.  Manufacturers'  Ins.  Co.,  113  Mass.  77. 

5  Pratt  V.  Atlantic  &  St.  Lawrence  R.  R.  Co.,  42  Me.  ,''j79. 

6  Perley  v.  Eastern  R.  R.  Co.,  98  Mass.  414. 

T  [Nat.  Filtering  Oii  Co.  v.  Citizens'  Ins.  Co.,  106  N.  Y.  535.] 

171 


§  95]  INSURANCE :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  VL 

ill  diminishing  the  royalties  the  policy  did  not  attach.  One 
who  owns  half  of  a  vessel  and  charters  the  other  half,  agree- 
ing to  pay  for  the  whole  if  lost,  may  insure  the  whole  as  his 
property.  1(a)  A  common  carrier  may  insure  goods  in  his 
possession  to  the  extent  of  their  fair  value,^  even  though 
they  are  shipped  on  a  third  party's  vessel ;  and  the  carriers 
and  not  the  third  party  are  the  proper  ones  to  insure ;  nor 
will  the  omission  of  the  owner  of  the  vessel  vitiate  the  policy 
unless  it  affects  the  risk.-*^  An  insurance  "  on  goods  "  is  suf- 
ficient to  cover  the  interest  of  carriers  in  property  under 
their  charge.*  The  master  of  a  vessel  to  whom  property  on 
board  is  to  be  consigned,  in  the  absence  of  proof  that  the 
owner  of  the  property  had  not  given  authority  to  order  in- 
surance, has  an  insurable  interest  therein,  and  may  recover 
in  case  of  loss.^] 

§  95.  Debtor  in  Property  attached  ;  Bailee;  Surety.  — Where 
the  goods  of  an  assured  were  levied  upon  by  the  sheriff  by 
virtue  of  an  execution  against  him,  and  the  sheriff  took 
actual  possession  of  the  goods,  and  left  them  in  the  store  of 
the  assured,  the  doors  of  which  he  fastened  and  the  windows 
of  which  he  nailed  up,  and  the  sheriff  went  out  of  town  and 
took  the  key  of  the  store  with  him,  and  during  his  absence 
a  fire  took  place,  which  destroyed  the  store  with  its  con- 
tents, it  was  held  that  the  insured  was  nevertheless  entitled 
to  recover.^  In  this  case  it  was  urged  by  the  counsel  for  the 
plaintiffs  in  error  that  the  question  was  not  one  of  an  insur- 
able interest,  but  of  a  change  of  interest  and  risk  produced 
by  extrinsic  circumstances.  But  the  court,  per  Kennedy, 
J.,  did  not  acquiesce  in  this  view  of  the  case.  They  held 
that  the  position  that  the  assured  could  not  recover  on  his 

1  [Oliver  W.Greene,  3  Mass.  133,  137,  138.] 

2  [Savage  v.  Corn  Exchange,  &c.  Ins.  Co.,  36  N.  Y.  655,  658.] 

3  [Cha.seu.  Washington,  &c.  Ins.  Co.,  12  Barb.  595.] 
*  [Crowley  v.  Cohen,  3  B.  &  Ad.  478,  488.] 

6  [Ruck  V.  Chesapeake  Ins.  Co.,  1  Pet.  151,  163.] 

6  The  Franklin  Fire  Ins.  Co.  v.  Findlay,  6  Whart.  (Pa.)  483  ;  Keith  v.  Globe 
Ins.  Co.,  52  111.  518. 

(a)  The  charterer  of  a  vessel  may  in-  861  ;  Murdock  v.  Franklin  Ins.  Co.,  33 
sure  her.     The  Gulnare,  42  Fed.  Rep.     W.  Va.  407. 

172 


CH.  VI.]  SUBJECT-MATTER. — IXSUEABLE   INTEREST.        [§  95  A 

policy  for  the  loss  of  a  diminished  interest  was  untenable; 
nor  did  they  admit  that  the  interest  in  this  case  was  a 
diminished  interest;  for  the  loss  must  fall  upon  the  defend- 
ant in  error,  neither  the  sheriff  nor  the  plaintiffs  in  the  exe- 
cution being  in  default,  unless  he  could  obtain  remuneration 
from  the  insurers  upon  the  policy;  and  he  was  still  liable 
on  the  judgment  obtained  against  him  to  pay  the  debt  for 
which  his  goods  were  taken  on  execution.  A  bailee,  who 
has  given  a  bond  to  dissolve  an  attachment,  and  is  under 
obligation  to  produce  the  property  to  respond  to  the  judg- 
ment, has  an  insurable  interest.^  So  has  a  creditor  in  a 
stock  of  goods  he  has  sold  to  his  debtor. ^  And  so  has  one 
who  is  liable  on  a  warehouse  bond  to  pay  a  tax  or  duties  on 
the  property  insured.^ 

[§  95  A.  Bailee  ;  "Warehouseman ;  Consignees  ;  Commission 
Merchants  ;  Builder.  —  A  bailee,  though  without  pecuniary 
interest  or  responsibility  for  safe  keeping,  may  insure  and 
sue  in  his  own  name  "  for  account  of  whom  it  may  concern, " 
and  the  insurance  will  inure  to  the  owners  who  may  adopt 
the  bailee's  act  even  after  loss.^  A  wharfinger  may  insure 
the  full  value  of  goods  in  his  charge  without  the  owner's 
knowledge,  and  recover  the  entire  proceeds  as  a  trust  fund 
for  the  said  owners.^  Warehousemen  may  insure,  and  re- 
cover the  full  value  di  goods  stored  with  them,  the  policy 
covering  goods  that  were  "their  own  or  held  by  them  in 
trust,"  &c.^  Consignees  who  also  advance  money  on  account 
of  the  cargo  and  charges  have  an  insurable  interest  in  the 
ship.'  A  commission  merchant  has  an  insurable  interest  in 
grain  deposited  with  him,  although  the  contract  with  the 
depositor  stipulates  that  it  is  at  owner's  risk  of  fire.^  Where 
one  operating  a  grain  elevator  had  wheat  stored  with  him 

1  Fireman's  Ins.  Co.  v.  Powell,  13  B.  Mon.  (Ky.)  312. 

2  Roos  V.  Merchants'  Mut.  Ins.  Co.,  27  La.  An.  409. 

*  Insurance  Cos.  v.  Thompson,  95  U.  S.  547. 

*  [Fire  Ins.  Ass.  v.  Merchants',  &c.  Trans.  Co.,  66  Md.  339.] 
s  [Waters  i\  Assurance  Co.,  5  E.  &  B.  870,  880.] 

6  [Pelzer,  &c.  Co.  v.  St.  Paul  F.  &  M.  Ins.  Co.,  41  Fed.  Rep.  271  (S.  C),  1890.] 

7  [Aldrich  v.  Equitable  Safety  Ins.  Co.,  1  W.  &  M.  (U.  S.)  272,  275.] 

8  [Baxter I'.  Hartford  Fire  Ins.  Co.,  12  Fed.  Rep.  481  ;  11  Biss.  306  ;  16  Cent. 
L.  J.  50  ;  14  Rep.  106,  1882.] 

173 


8  96]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  VI. 

for  which  he  gave  a  receipt,  "fire  at  owner's  risk,"  it  was 
nevertheless  held  that  he  had  an  insurable  interest  therein. 
In  this  case  the  wheat  belonged  to  him.  He  was  not  to  re- 
deliver the  identical  wheat  deposited,  but  an  equal  quan- 
tity. ^  (a)  A  builder  constructing  a  house  on  contract,  and 
receiving  the  price  in  instalments,  has  the  property  in  the 
house  until  it  is  delivered,  or  at  least  until  it  is  ready 
for  delivery  and  is  approved,  and  he  may  insure  the 
building.2  (b)] 

§  96.  Vendee  without  Title  ;  Shifting  Interest.  —  It  has  been 
said  that  an  interest  in  goods  under  a  contract  which  can- 
not be  enforced  as  being  in  contravention  of  the  Statute  of 
Frauds,  is  not  an  insurable  interest.  Thus,  where  by  verbal 
agreement  the  plaintiff  had  agreed  to  purchase  oil  to  arrive, 
and  to  be  paid  for  it  if  it  arrived,  but  not  otherwise,  and  it 
was  lost,  it  appearing  that  the  contract  was  one  which  by 
the  Statute  of  Frauds  is  required  to  be  in  writing  it  was  held 
that  he  had  no  insurable  interest.^     And  so  where  the  plain- 

1  [Baxter  v.  Hartford  Fire  Ins.  Co.,  11  Biss.  306,  308.] 

2  [Commercial  Fire  Ins.  Co.  v.  Cap.  City  Ins.  Co.,  81  Ala.  320.] 
s  Stockdale  v.  Dunlop,  6  Mees.  &  Wels.  224. 

(a)  Such  a  bailee  as  a  cotton-com-  of  construction   by  a  contractor,   even 

press  company  may  insure  all  the  cot-  though  he  has  as  yet  supplied' no  money 

ton  placed  in  its  hands  for  compression  therefor,  and  is  fully  indemnified  against 

by  different  owners,  as  being  held  in  loss   through  his   contracts.     Foley   v. 

trust  ;   and   it   can  recover   the   entire  Manufacturers'  F.   Ins.  Co.,  152  N.  Y. 

value  in  case  of  loss,  holding  the  excess  131  ;    43    L.    R.    Ann.   664,   and   note, 

over  its  own  interest  for  the  benefit  of  Such   owner   and   the  contractor    may 

those  who  have  entrusted  the  goods  to  each  insure  and  recover  for,  independ- 

it.     California  Ins.  Co.  v.  Union  Com-  ently  of  the  other,  the  full  amount  of 

press  Co.,   133  U.   S.    387,  409  ;  Mer-  his  interest.     Santa  Clara  Female  Acad- 

chants'  Cotton-press  Co.  v.  Ins.  Co.  of  emy  v.  Northwestern  National  Ins.  Co., 

North  America,  151   U.   S.    368.     See  98  Wis.  257. 

Berrj'  v.   American   Central   Ins.   Co.,  Insurance  upon    a  decedent's    "  es- 

132  N.   Y.  49,  56.  tate  "  by  only  one  of  the  heirs,  the  ad- 

(6)  A  house-mover  has  an  insurable  ministrator  not  assenting,  is  valid  as  to 

interest  in  the  house  to  the  extent  of  his  the  insured's  interest.     Phoenix  Ins.  Co. 

compensation   and  expenses;    but   in-  r.  Hancock,  123  Cal.  222  ;  seeKrausei?. 

surancethereof  does  not  include  his  tools  Equitable  L.  Ass.   Society,   105  Mich, 

destroyed  in  the    house.      Planters   &  329.     A  creditor  of  such  estate  has  an 

Merchants'   Ins.   Co.   v.   Thurston,    93  insurable  interest  in  the  realty  when  the 

Ala.  255.     The  owner  in  fee  of  an  uu-  personal  estate  is  insufficient  to  pay  the 

finished  building  has  an  insurable  in-  debts.     Creed  v.  Sun   Fire  Office,  101 

terest   therein  while   it  is  in    process  Ala.  522. 

174 


CH.  VI.]  SUBJECT-MATTER.  —  INSURABLE   INTEREST.  [§97 

tiff  held  an  instrument  made  by  the  captain  of  a  vessel,  in 
the  nature  of  a  mortgage,  to  secure  the  plaintiff  for  money 
loaned  with  which  to  pay  for  repairs  on  the  vessel,  as  the 
instrument  was  one  which  the  captain  of  the  vessel  had  no 
right  to  make,  and  was  therefore  void,  the  court  said  it  did 
not  give  to  the  plaintiff  an  insurable  interest,^  Upon  the 
doctrine  of  these  cases  it  has  been  stated,  as  a  general  prop- 
osition, that  a  right  under  a  contract  not  enforceable  at 
law  or  equity  will  not  support  a  policy  of  insurance ;  and 
among  such  contracts  would  be  included  a  verbal  contract 
for  the  purchase  of  real  estate,  when  it  is  not  aided  by  part 
performance. 2  (a) 

§  97.  Vendor  in  Possession,  but  without  Title.  —  In  North 
British  and  Mercantile  Insurance  Company  v.  Moffatt,^ 
goods  on  a  wharf  were  insured  as  "the  assured's  own,  in 
trust  or  on  commission,  for  which  the  assured  was  respon- 
sible." The  assured  had  sold  a  portion  of  the  goods  de- 
stroyed and  received  the  pay  therefor,  but  still  held  the 
wharfinger's  delivery-warrant  for  the  goods  on  behalf  of  the 
purchaser,  though  merely  for  the  convenience  of  paying 
the  charges  necessary  to  clear  the  goods ;  and  it  was  held 
that  the  goods  had  passed  to  the  purchaser,  so  that  the 
vendor,  the  assured,  had  no  longer,  at  the  time  of  the  fire, 
any  interest  in  the  goods,  or  any  responsibility  therefor. 

1  Stainbank  v.  Fenning,  6  Eng.  L.  &  Eq.  412. 

2  Angell,  Ins.  §  69.  The  learned  author  cites  Tidswell  v.  Ankerstein,  Peake, 
151,  and  Fletcher  v.  Commonwealth  Ins.  Co.,  18  Pick.  (Mass.)  419,  neither  of 
which  seems  to  give  the  least  support  to  the  doctrine,  or  even  to  discuss  the  point 
in  any  way.  The  former  merely  decides  that  an  executor  has  an  insurable 
intei'est  in  the  life  of  one  who  has  granted  an  annuity  to  his  testator,  and  the 
latter  that  a  person  having  a  house  on  the  land  of  another,  for  wliich  he  pays 
rent  under  a  verbal  agreement,  is  not  guilty  of  concealment  in  not  stating  this 
fact  as  to  his  title,  not  being  interrogated  thereupon.  There  is  doubtless  some 
mistake  in  the  citation.  And  see  ante,  §§  89,  90.  It  is  doubtful  if  either  of  the 
cases  cited  in  this  section  would  now  be  regarded  as  law  in  this  counti-y.  See 
post,  §  108,  and  ante,  §  87. 

8   41  L.  J.   N.  S.   C.   p.   1. 

(a)  A  vendee  has  an  insurable  in-  153  Mass.  335,  341  ;  Amsinck  v.  Amer- 

torest  in   personal   property,    although  ican   Ins.    Co.,    129     id.    185  ;    Bohn 

the   title  remains   in  the  vendor  until  Manuf.  Co.   v.  Sawyer,   169  id.  477. 
delivery.     Wainer  v.  Milford  Ins.  Co., 

175 


§  99]  INSURANCE  :    FIRE,  LIFE,   ACCIDENT,   ETC.  [CH.  VI. 

Holder  of  Promissory  Note.  —  The  holder  of  a  note  may 
insure  its  prompt  payment,  and  the  assignee  of  the  policy, 
that  being  negotiable,  has  an  insurable  interest.  ^  And  so 
a  surety  for  the  fidelity  of  an  employ^  may  insure  against 
his  default.  2 

§  98.  Reinsurance.  —  The  risk  which  one  insurer  has  as- 
sumed with  reference  to  any  subject-matter  of  insurance 
constitutes  an  insurable  interest,  which  the  insurer  may  pro- 
tect, to  the  extent  of  his  liability,  by  effecting  an  insurance 
in  his  own  favor  against  the  risk  he  has  assumed.  This 
procuring  insurance  to  cover  a  risk  already  assumed  is 
called  reinsurance.  The  subject-matter  of  the  insurance  in 
each  case  is  the  same,  but  the  interests  are  different.  In 
the  first  case,  the  owner's  interest  is  that  which  is  pro- 
tected ;  in  the  latter,  it  is  the  insurer's  interest  in  the  pres- 
ervation of  the  property  by  reason  of  the  fact  that  he  is 
under  obligation  to  pay  for  it  in  case  of  loss.  As  the  prac- 
tice came  to  be  a  mode  of  speculating  in  the  rise  and  fall  of 
premiums,  and  there  was  danger  that  it  might  become  a 
cover  for  wager  policies,  it  was  prohibited  in  England  by 
statute  ^  except  in  certain  cases. ^  But  it  is  a  contract  en- 
tirely within  the  general  purposes  and  objects  of  insurance, 
and  comes  within  the  scope  of  the  powers  usually  conferred 
by  charters,  and  has,  it  is  believed,  been  very  generally,  if 
not  universally,  England  alone  excepted,  upheld.^ 

§  99.  Copartner.  — A  partner  has  an  insurable  interest  to 
the  amount  of  the  value  of  the  entire  stock ;  ^  and  in  a  house 
purchased  with  partnership  funds,  but  standing  upon  land 
of  the  other  partner  by  his  consent.'^  Upon  settlement  of 
the  joint  account,   the   building   must   be  treated  as  joint 

1  Ellicott  V.  United  States  Ins.  Co.,  8  Gill  &  Johns.  (Md. )  166. 

2  Towle  V.  National  Guardian  Ins.  Co.,  5  L.  T.  R.  N.  s.  193;  s.  C.  30  L.  J. 
Ch.  900  ;  7  Jur.  n.  s.  1109.     See  post,  chapter  on  Guarantee  Insurance. 

8  19  Geo.  II.  c.  27. 

*  1  Aniould,  Ins.  287. 

s  New  York  Bowery  Fire  Ins.  Co.  v.  New  York  Fire  Ins.  Co.,  17  Wend. 
(N.  Y.)  359  ;  Eastern  Railroad  Co.  v.  Relief  Fire  Ins.  Co.,  98  Mass.  425.  See 
also  ante,  §§  9-12. 

«  Manhattan  Ins.  Co.  v.  "Webster,  59  Pa.  St.  227. 

">  Converse  v.  Citizens'  Mut.  Ins.  Co.,  10  Gush.  (Mass.)  37. 

176 


CH.  YI.]  SUBJECT-MATTER. — INSURABLE   INTEREST.  [§100 

property,  and  his  equitable  interest  in  its  preservation  is  an 
insurable  one.^a)  When  a  partner  retires  from  the  firm, 
but  no  notice  of  a  dissolution  is  given,  and  the  firm  name  is 
used  by  the  remaining  partner,  the  retired  but  nominal  part- 
ner has  an  insurable  interest,  so  that  insurance  in  the  name 
of  the  firm  is  valid  to  the  full  amount.  The  legal  interest 
is  in  the  firm,  though  the  beneficial  interest  is  in  the  re- 
maining partner.  2 

§  100.  Duration  of  Interest.  —  In  general,  it  is  essential 
that  the  insured  shall  be  possessed  of  an  interest,  both  at 
the  time  when  the  insurance  is  effected  and  at  the  time  of 
the  loss; 3  and  so  strictly  is  this  principle  adhered  to,  that 
no  recovery  can  be  had  even  where  by  the  terms  of  the  pol- 
icy the  loss  is  payable  to  a  third  person,  though  that  third 
person  have  at  the  time  of  the  loss  an  interest  in  the  prop- 
erty insured.*  This  doctrine  was  early  applied  to  life  as 
w^ell  as  to  marine  and  fire  policies;^  but  we  shall  see  here- 
after that,  as  to  life  policies,  it  has  undergone  some  modifi- 
cation; and  in  marine  insurance  the  policy  is  often  made  to 
attach  to  after-acquired  property. ^  There  seems  to  be  no 
sufficient  reason  why  the  same  principle  should  not  apply  in 
fire  policies.  Indeed,  it  has  been  frequently  held  that  a  policy 
on  a  stock  of  goods  covers  after-acquired  and  substituted 
goods.'  And  a  joint  policy  on  the  lives  of  a  husband  and  wife, 
payable  to  the  survivor,  is  not  avoided  by  the  cessation  of 
interest  after  a  divorce  and  a  decree  of  alimony  to  the  wife.^ 

1  Ibid.     See  also  Oakman  v.  Dorchester  Mut.  Fire  Ins.  Co.,  98  Mass.  57. 

2  Phoenix  Ins.  Co.  v.  Hamilton,  14  Wall.  (U.  S.)  504. 

3  Lynch  v.  Dalzell,  4  Bro.  P.  C.  431  ;  Sadlers'  Co.  v.  Badcock,  2  Atk.  554  ; 
s.  c.  I'Wil.  10  ;  Howard  v.  Albany  Ins.  Co.,  3  Denio  (N.  Y.),  301  ;  Fowler  v. 
Indemnity  Ins.  Co.,  26  N.  Y.  422  ;  French  v.  Hope  lus.  Co.,  16  Pick.  (Mass.)  397. 

*  Tallman  v.  Atlantic  Fire  &  Mar.  Ins.  Co.,  29  How.  (N.  Y.  Pr.)  71. 
5  Godsall  V.  Boldero,  9  East,  72. 

e  Hooper  v.  Robinson  (Sup.  Ct.  U.  S.),  8  Ins.  L.  J.  497  ;  1  Amould,  Ins. 
(Perk,  ed.)  238. 

T  Butler  V.  Standard  Ins.  Co.,  4  U.  C.  (App.)  391.     See  also  post,  §  101. 
»  Connecticut  Mut.  Life  Ins.  Co.  v.  Schaefer,  94  U.  S.  457. 

(a)  If  property  is  insured  under  the  he  can  recover  the  full  amount  of  the  loss 

name  of  the  general  partner,  whose  name  and  not  merely  of  his  interest.     Clement 

is  used  to  represent  a  special  partnership  v.  British  American  Ass.  Co.,  141  Mass. 

formed  under  the  Massachusetts  statute,  298. 

VOL.  I.  — 12  177 


§  100  A]     insurance:  fire,  life,  accident,  etc.        [ch.  vi. 


[§  100  A.  The  general  rule  undoubtedly  is  that  the  in- 
sured must  have  an  insurable  interest  both  at  the  time  of 
insurance  and  at  the  time  of  loss.i  ..  But  there  are  many 
exceptions. 2  An  interest  either  at  the  time  of  loss  or  of 
insurance  may  be  suiScient,  and  I  do  not  think  that  the  rea- 
sons  of  the  exceptions  are  entirely  confined  to  life  insurance. 
Where  the  interest  is  known  to  be  of  such  a  nature  that  in 
the  natural  course  of  affairs  and  without  fault  of  the  assured 
it  may  cease  before  the  event  insured  against  transpires,  it 
is  very  proper  to  hold  the  company,  after  cessation  of  the 
interest,  to  save  the  assured  the  loss  of  his  premiums.  But 
the  insured  should  never  be  allowed  to  retain  more  than  in- 
demnity, otherwise  he  would  have  an  interest  in  the  destruc- 
tion of  the  subject  insured,  and  the  evil  at  the  heart  of  wager 
policies  would  creep  in  by  a  back  door.  Any  funds  recov- 
ered from  the  company  beyond  indemnity  should  go  to  the 
owner  of  the  subject-matter  or  his  representatives.  This 
doctrine,  however,  is  not  uniformly  recognized.  ^  Pennsyl- 
vania holds  that  if  there  is  an  insurable  interest  at  the  time 
of  insurance,  its  cessation  before  loss  will  not  deprive  the 
assured  of  the  right  to  the  funds  as  against  the  representa- 
tives of  the  life.*  The  grantee  of  an  annuity  who  has  in- 
sured the  life  of  the  grantor,  is  not  bound  to  deliver  up  the 
policy  of  assurance  to  the  grantor  on  the  redemption  of  the 
annuity.  In  the  absence  of  agreement  or  special  circum- 
stances, the  policy  belongs  to  the  grantee  of  the  annuity.^ 
A  nephew  insuring  the  life  of  an  aunt  who  owed  him  money 
may  recover,  although  the  debt  was  paid  before  his  aunt 
died.  The  view  that  a  life  policy  is  a  contract  of  indemnity 
has  been  abandoned  (as  between  the  company  and  the  as- 
sured). It  is  enough  if  the  insured  had  an  interest  at  the 
inception  of  the  contract,  and  this  without  regard  to  the 
amount  of  it,   unless  the  estimate  was  in   bad  faith. ^     If 

1  [Chrisman  v.  State  Ins.  Co.,  16  Or.  288.] 

2  [See  §115.] 
8  [See  ch.  24.] 

*  [Appl.  of  Corson,  113  Pa.  St.  438  ;  Scott  v.  Dickson,  108  Pa.  St.  6.] 

6  [Gotlieb  V.  Oranch,  4  De  G,  M.  &  G.  440.] 

«  [Corson  V.  Gamier,  17  Phil.  341  ;  affirmed,   113   Pa.  St.  438,  1880 ;  citing 

178 


CH.  VI.J  SUBJECT-MATTER.  —  INSURABLE   INTEREST.  [§  101 

the  declaration  aver  that  the  assured  was  interested  at  the 
time  of  loss,  it  need  not  aver  that  he  was  at  the  time  of  in- 
surance.^ The  court  thought  there  was  much  reason  to  be- 
lieve that  one  having  an  interest  at  the  time  of  loss,  though 
none  at  the  time  of  insurance,  ought  to  be  protected  even 
without  an  express  stipulation  to  that  effect,  and  certainly 
if  such  was  the  agreement.  On  the  contrary,  it  has  been 
held  in  Canada  that  if  the  assured  had  no  interest  in  the 
property  at  the  time  of  insurance,  a  subsequently  acquired 
interest  will  not  save  the  policy,  and  a  renewal,  after  the 
interest  is  gained,  being  a  mere  continuation  of  the  void 
policy,  is  itself  void.^  This  case  puts  technicalities  before 
substance.  Where  there  is  no  interest  at  the  time  of  insur- 
ance, one  of  the  necessary  elements  of  the  contract  does  not 
exist;  but  if  afterwards  and  before  loss  the  insured  acquires 
an  interest  in  the  subject  insured,  whether  it  be  life  or 
property,  that  element  comes  into  being,  and  if,  knoiving  the 
facts,  the  company  thereafter  recognizes  the  policy  as  valid  or 
executes  a  renewal,  there  could  be  no  clearer  case  of  a  meet- 
ing of  minds  with  all  necessary  elements  existent,  and  the 
company  should  be  held.  In  this  case  indeed,  there  is  an 
interest  at  the  time  of  contract  as  well  as  at  the  time  of 
loss.  The  opinion  goes  on  the  ground  that  the  renewal  is 
a  mere  continuation  of  the  old  policy  and  not  a  new  con- 
tract, but  this  is  not  the  best  view.^  The  renewal  is  a  new 
contract,  and  if  at  the  time  it  is  made  the  elements  of  a  con- 
tract exist,  it  is  sufficient.  If,  however,  the  original  con- 
tract was  defective,  suit  should  be  brought  on  the  renewal 
receipt,   not  on  the  old  policy.*] 

§  101.  Continuity  of  Interest.  —  It  has  also  been  said  that 
the  interest  should  remain  an  uninterrupted  interest  from 
the  time  of  the  insurance  to  the  time  of  the  loss,  so  that  if 
the  insured,  at  any  time  after  the  policy  is  taken  out,  parts 

PhcEnix  Mut.  Life  Ins.  Co.  v.  Baily,  13  Wall.  616  ;  Conn.  Mat.  Life  Ins.  Co. 
V.  Luchs,  108  U.  S.  498.] 

1  [Henshawu.  Mut.  Safety  Ins.  Co.,  2  Blatch.  99,  104.] 

2  [Howard  v.  Lancashire  Ins.  Co.,  11  Can.  Supr.  Ct.  92.] 
^  [Firemen's  Ins.  Co.  v.  Floss  &Co.,  67  Md.  404.] 

*  [See  King  v.  Hekla  Fire  Ins.  Co.,  58  Wis.  508.] 

179 


§  101]  INSURANCE  :   FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  VI. 

with  his  title,  though  afterwards,  and  before  the  loss,  he 
repurchase,  yet  the  policy  will  not  attach,  and  the  insured 
will  be  without  remedy.^  But  in  the  absence  of  any  condi- 
tion against  alienation  which  avoids  the  policy,  it  is  not 
easy  to  see  how  the  insurers  can  be  prejudiced  by  such  an 
interruption  of  title,  since  for  so  long  a  period  at  least  as  is 
occupied  by  the  interruption  they  are  without  risk,  and  at 
no  time  do  they  incur  any  greater  hazard  than  they  agree  to 
assume,  whether  we  regard  the  property  upon  which  the  risk 
is  taken,  or  the  person  in  behalf  of  whom  it  is  taken.  The 
insured  has  violated  no  stipulation  of  the  contract,  the  in- 
surer has  not  been  prejudiced,  and  that  there  is  nothing  in- 
compatible with  the  true  principles  of  insurance  in  holding 
the  insurer  responsible  after  such  an  interruption,  is  shown 
by  the  familiar  practice  of  insuring  stocks  in  trade,  under 
which  the  right  of  the  insured  to  sell  and  repurchase  the 
same  stock,  or  a  substitute,  cannot  be  questioned.^  In  Rex 
V.  Insurance  Companies,^  it  was  held  that,  where  a  mort- 
gagee insured  his  interest,  which  was  based  upon  present 
and  contemplated  advances,  to  the  mortgagor,  and  during 
the  currency  of  the  policy  the  earlier  advances  were  repaid 
and  new  ones  made,  the  policy  was  a  valid  security  for  such 
advances,  within  the  amount  insured,  as  remained  unpaid 
at  the  time  of  the  loss.*  And  quite  recently,  in  a  case  in 
Massachusetts,  the  case  of  Cockerill  v.  Cincinnati  Insurance 
Company  was  cited  in  argument,  and  its  doctrine  insisted 
upon  as  the  law.  The  facts  were  not  such  as  to  require  a 
direct  ruling  on  the  point,  but  if  they  had  been,  there  can 
be  no  doubt  that  the  court  would  have  sustained  the  validity 
of  the  policy.^ 

1  Cockerill  v.  Cincinnati  Ins.  Co.,  16  Oliio,  148. 

2  Lane  v.  Maine  Mat.  Fire  Ins.  Co.,  3  Fairf.  (Me.)  44  ;  Wood  v.  Rutland  & 
Addison  Mut.  Fire  Ins.  Co.,  31  Vt.  (2  Shaw)  552  ;  Lee  &  Howard  Ins.  Co.,  11 
Cush.  (Mass.)  324  ;  City  Fire  Ins.  Co.  v.  Mark,  45  111.  482  ;  Peoria  Mar.  &  Fire 
Ins.  Co.  V.  Anapow,  51  111.  283  ;  Whitwell  r.  Putnam  Fire  Ins.  Co.,  6  Lans. 
(N.  Y.)  166  ;  Mills  v.  Farmers'  Ins.  Co.,  37  Iowa,  400,  404  ;  Crozier  i'.  Phoeni.x 
Ins.  Co.,  2  Hannay  (N.  B.),  200 ;  ante,  §  100  ;  post,  §§  374,  381. 

3  2  Phila.  (Pa.)  357. 

*  See  also  2  Am.  Leading  Cases,  463. 

6  Wortlurigton  v.  Bearse,  12  Allen  (Mass.),  382.    The  observations  of  the  court 
180 


CH.  VL]  SUBJECT-MATTEK.  —  INSURABLE    INTEREST.  [§101 

So  a  violation  of  the  conditions  against  over-insurance  or 
sale,  and  upon  principle  any  like  condition,  non-existent  at 

in  the  case  are  so  pertinent,  and  withal  so  weighty,  that  we  make  no  apology  for 
giving  them  in  full.  "  But  if  it  were  otherwise,"  says  Bigelow,  C.  J.,  who  gave 
the  opinion,  "and  it  appeared  that  the  sale  of  the  vessel  was  complete  and 
absolute,  so  that  for  a  time  the  insured  had  parted  with  his  insurable  interest, 
his  right  to  recover  on  the  policy  was  not  gone  forever.  It  was  only  suspended 
during  the  time  that  the  title  to  the  vessel  was  vested  in  the  vendee,  and  was 
revived  again  on  the  reconveyance  to  the  insured  during  the  term  specified  in 
the  policy.  The  insurance  was  for  one  year.  There  was  no  stipulation  or  con- 
dition in  the  policy  that  the  insured  should  not  convey  or  assign  his  intei-est  in 
the  vessel  during  this  period.  The  contract  of  insurance  was  absolute  to  insure 
the  interest  of  a  person  named  in  a  particular  subject  for  a  specitied  time;  for  this 
entire  risk  an  adequate  premium  was  paid,  and  the  policy  duly  attached,  because 
the  assured  at  the  inception  of  the  risk  had  an  insurable  interest  in  the  policy. 
So,  too,  at  the  time  of  the  loss,  all  the  facts  necessary  to  establish  a  valid  claim 
under  the  policy  e.xisted.  The  execution  of  the  policy,  the  interest  of  the  assured 
in  the  vessel,  the  due  inception  of  the  risk,  a  compliance  with  all  warranties  ex- 
pressed  and  implied,  and  the  loss  by  a  peril  insured  against,  are  all  either  admitted 
or  proved.  Upon  what  legal  ground,  then,  can  it  be  maintained  that  the  policy 
has  become  extinct  ?  No  fact  is  shown  from  which  any  inference  can  be  made 
that  by  the  alienation  of  the  title  to  the  vessel  during  the  time  named  in  the 
policy  the  risk  of  the  insurers  upon  the  subsequent  retransfer  of  the  vessel  to  the 
assured  was  in  any  degree  increased  or  affected,  or  that  any  loss,  injury,  or  preju- 
dice to  the  underwriter  was  occasioned  by  the  fact  that  the  absolute  title  to  the 
vessel  was  temporarily  vested  in  a  third  person.  On  the  contrary,  such  temjiorary 
transfer  of  title  would  seem  rather  to  have  inured  to  the  benefit  of  the  insurers 
because  they  have  received  a  premium  for  a  risk  from  which  they  were  exempted 
during  a  portion  of  the  time  designated  in  the  polic)^  In  the  absence  of  any 
express  stipulation,  as  in  the  policy  declared  on,  no  return  premium  could  be 
claimed  by  the  assured  by  reason  of  any  temporary  suspension  of  the  work  or 
withdrawal  of  the  subject  insured.  The  policy  had  attached,  and  the  risk  was 
entire.  During  the  time  that  the  vessel  was  owned  by  a  person  other  than  the 
assured,  no  loss  could  happen  which  could  be  covered  by  tlie  policy.  The  in- 
sured, having  no  interest,  could  sustain  no  loss.  If  a  total  loss  occurred  during 
the  period,  the  insurable  interest  would  become  extinct.  Upon  a  retransfer  of 
title  to  the  insured,  the  policy  would  revive  only  to  secure  the  renewed  interest 
thereby  acquired,  and  not  to  render  the  insurers  liable  for  losses  which  may  have 
happened  during  the  intermediate  period.  The  sole  effect  would  be  to  suspend  the 
risk  for  the  time  during  which,  by  reason  of  the  transfer,  the  assured  had  no  in- 
terest in  the  subject  insured,  and  to  revive  it  as  soon  as  the  oritcinal  interest  was 
vested  in  him.  The  transfer  of  the  vessel  rendered  the  policy  inoperative  and  not 
void.  It  could  have  no  effect  while  the  insured  had  no  interest  in  the  subject 
insured.  But  when  this  interest  was  revived  or  restored  during  the  time  desig- 
nated in  the  policy,  without  any  increase  or  change  of  risk  or  other  prejudice 
to  the  underwriter,  there  seems  to  be  no  valid  reason  for  holding  that  the  policy 
has  become  extinct.  Inasmuch  as  neither  the  subject  nor  the  person  insured  is 
changed,  and  the  risk  remains  the  same,  the  intermediate  transfer  is  an  immaterial 
fact  which  can  in  no  way  affect  the  claim  under  the  policy. 

"This  doctrine  is  not  only  consistent  with  sound  reason,  but  it  is  in  accordance 
with  the  analogies  of  the  law  of  marine  insurance.     Risks  may  be  temporarily  sus- 

181 


§  102]        insurance:  fire,  life,  accident,  etc.        [ch.  vl 

the  time  of  the  loss,  does  not  work  a  forfeiture,  but  only  a  sus- 
pension of  the  insurance  during  the  violation.  ^  So  navigation 
in  excepted  or  non-permitted  waters  may  suspend  but  does  not 
terminate  the  policy,  unless  explicitly  so  provided.  2  So  a  policy 
suspended  during  repairs  may  revive  after  their  completion.  ^ 
§  102.  Life.  —  Within  the  present  century  it  was  made  a 
serious  question  in  one  of  the  most  learned  courts  of  this 
country,  in  a  case  of  novel  impression,  whether  one  person 
can  have  such  an  interest  in  the  preservation  of  the  life  of 
another  as  to  make  it  the  valid  basis  of  a  contract  of  insur- 
ance. But  as  upon  well-settled  principles  of  law  all  con- 
tracts, fairly  made,  upon  a  valuable  consideration,  which 
infringe  no  law,  and  are  not  repugnant  to  the  general  policy 
of  the  law,  or  to  good  morals,  are  valid  and  may  be  en- 
forced, or  damages  recovered  for  the  breach  of  them,  it  saw 
no  reason  to  except  the  contract  of  insurance  out  of  this  gen- 
eral rule.  Prior  to  this  decision,  the  insurance  of  lives  was 
prohibited  in  several  of  the  countries  of  Europe,  though  it 

pended,  aud  subsequent!}'  revived,  without  invalidating  the  right  of  the  assured 
to  claim  under  the  policy.  Unseaworthiness,  after  the  policy  has  attached,  if  im- 
putable to  the  neglect  or  other  fault  of  the  assured,  will  suspend,  but  not  destroy, 
the  risk.  Restoration  of  the  navigability  of  the  vessel  will  revive  the  right  of 
the  assured  to  claim  under  his  policy.  Taylor  v.  Lowell,  3  Mass.  331  ;  1  Phil. 
Ins.  §  734.  So  goods  insured  for  a  voyage  which,  by  the  terms  of  the  policy,  are 
covered  only  when  water-borne,  may  be  withdrawn  from  the  risk  while  tempo- 
rarily placed  on  land  ;  but  the  policy  upon  them  will  revive  when,  without  in- 
crease of  risk,  they  are  again  put  on  board  the  vessel.  In  these  and  like  cases  the 
principle  adopted  is,  that  the  contract  of  insurance  is  not  violated,  or  the  right  of 
the  assured  to  claim  an  indemnity  affected,  by  the  existence  of  a  state  of  facts 
which  does  not  contravene  any  stipulation  in  the  policy,  or  in  any  way  change  or 
affect  the  risk,  or  otherwise  work  any  injur}'' or  prejudice  to  the  rights  of  the  in- 
surer." The  learned  judge  cites  also  Carroll  v.  Boston  Mar.  Ins.  Co.,  8  Mass.  515; 
Power  w.  Ocean  Ins.  Co.,  19  La.  28  ;  Howard  v.  Albany  Ins.  Co.,  3  Denio  (N.  Y.), 
301  ;  1  Phil.  Ins.  §  89.  And  see  also  Hartford  Protection  Ins.  Co.  v.  Harmer,  2 
Ohio,  N.  s.  452;  and  Hooper  v.  Hudson  River  Ins.  Co.,  15  Barb.  (N.  Y.)  413  ; 
s.  c.  alfirmed  in  Court  of  Appeals,  117  N.  Y.  424. 

1  New  England  Fire  &  Mar.  Ins.  Co.  v.  Schettler,  38  111.  166  ;  Obermeyer  v. 
Globe  Mut.  Ins.  Co.,  43  Mo.  573  ;  Mitchell  v.  Lycoming  Mut.  Ins.  Co.,  51  Pa.  St. 
402  ;  Power  v.  Ocean  Ins.  Co.,  19  La.  28;  Lane  v.  Maine  Mut.  Fire  Ins.  Co., 
3  Fairf.  (Me.)  44;  Morrison  v.  Tenn.  Mar.  &  Fire  Ins.  Co.,  18  Mo.  262.  And 
see  post,  §  245. 

2  Greenleaf  v.  St.  Louis  Ins.  Co.,  37  Mo.  25,  30.  But  see  conira,  Wilkins  u. 
Tobacco  Mar.  &  Fire  Ins.  Co.,  2  Superior  Ct.  (Cincinnati)  204, 

8  Insurance  Co.  of  N.  A.  v.  McDowell,  50  111.  120. 
182 


CH.  VI.]  SUBJECT-MATTER.  —  INSURABLE   INTEKEST.  [§103 

does  not  appear  that  the  prohibition  rested  so  much  upon 
the  absence  of  an  interest  to  be  protected,  as  upon  some 
vague  notion  that  it  is  indecorous  to  attempt  to  set  a  price 
upon  the  life  of  a  man.^ 

[§  102  A.  What  is  an  Insurable  Interest  in  a  Life.  To 
have  an  insurable  interest  in  the  life  of  another  one  must  be 
a  creditor  or  surety,  or  be  so  related  by  ties  of  blood  or  mar- 
riage as  to  have  reasonable  anticipation  of  advantage  from 
his  life.^  Whenever  there  is  such  a  relationship  that  the 
insurer  has  a  legal  claim  on  the  insured  for  services  or  sup- 
port, or  when  from  the  personal  relations  between  them  the 
former  has  a  reasonable  right  to  expect  some  pecuniary  ad- 
vantage from  the  continuance  of  the  life  of  the  other,  or  to 
fear  loss  from  his  death,  an  insurable  interest  exists.^  And 
again,  "  It  is  not  easy  to  define  with  precision  what  will  in 
all  cases  constitute  an  insurable  interest,  so  as  to  take  the 
contract  out  of  the  class  of  wager  policies.  It  may  be  stated 
generally,  however,  to  be  such  an  interest,  arising  from  the 
relations  of  the  party  obtaining  the  insurance,  either  as 
creditor  of  or  surety  for  the  assured,  or  from  ties  of  blood 
or  marriage  to  him,  as  will  justify  a  reasonable  expectation 
of  advantage  or  benefit  from  the  continuance  of  his  life.  It 
is  not  necessary  that  the  expectation  of  advantage  should  be 
always  capable  of  pecuniary  estimation,  for  a  parent  has 
an  insurable  interest  in  the  life  of  his  child.  .  .  .  Natural 
affection  in  cases  of  this  kind  is  considered  more  power- 
ful in  protecting  the  life  of  the  insured  than  any  other 
consideration."^] 

§  103.  Sister  in  Life  of  Brother  in  loco  parentis.  —  In  Lord 
V.  Dall,  supra,  the  court  not  only  found  no  difficulty  in  hold- 
ing that  one  person  may  have  an  insurable  interest  in  the 
life  of  another,  but,  in  determining  under  what  circum- 
stances that  interest  may  exist,  laid  down  important  prin- 

1  Lord  V.  Dall,  12  Mass.  115,  decided  in  1815. 

2  [Appl.  of  Corson,  113  Pa.  St.  438  ;  Keystone  Mut.  Ben.  Ass.  v.  Norris,  115 
Pa.  St.  446  ;  United  Brethren  Mut.  Aid  See.  v.  McDonald,  122  Pa.  St.  324, 
(stepson  and  stepfather  as  such  no  insurable  interest).] 

3  [Rombach  v.  Piedmont,  &c.  Life  Ins.  Co.,  35  La.  An.  233.] 
*  [Warnock  v.  Davis,  104  U.  S.  779.  J 

183 


§  103  A]     insurance:  fire,  life,  accident,  etc.       [ch.  vi. 

cii)Ics  which  have  since  been  generally  approved,  and  led, 
and  are  leading,  to  a  great  enlargement  of  the  catalogue  of 
insurable  interests.  In  that  case  the  policy  was  effected  by 
the  plaintiff  upon  the  life  of  her  brother,  who  was  about  to 
embark  on  a  voyage  to  South  America,  or  elsewhere,  from 
Boston.  The  insurance  was  for  15,000  for  seven  months, 
and  the  premium  paid  was  one  per  cent  per  month.  The 
plaintiff  was  a  young  female,  without  property,  and  had 
been  supported  and  educated  at  the  expense  of  the  brother, 
who  stood  towards  her  in  loco  parentis^  Nothing  could  show 
a  stronger  affection  of  a  brother,  said  the  court,  for  a  sister, 
than  that  he  should  be  willing  to  give  a  large  sum  to  secure 
her  against  the  contingency  of  his  death,  which  would  other- 
wise have  left  her  in  absolute  want;  and  no  one  could  hesi- 
tate to  say  that  in  the  life  of  such  a  brother  the  sister  had 
an  interest.  They  were  well  satisfied  that  the  interest  of 
the  plaintiff  in  that  case,  in  the  life  of  her  brother,  was  of 
a  nature  to  entitle  her  to  insure  it,  observing,  that  the  inter- 
est of  a  child  in  the  life  of  a  parent,  except  the  insurable 
one,  which  may  result  from  the  legal  obligation  of  the  par- 
ent to  save  the  child  from  becoming  an  object  of  charity, ^  is 
as  precarious  as  that  of  a  sister  in  the  life  of  an  affectionate 
brother.  For  if  the  brother  may  withdraw  all  support,  so 
may  the  father,  except  as  above  stated.  And  yet  a  policy 
effected  by  a  child  upon  the  life  of  a  father,  who  depended 
upon  some  fund,  terminable  by  his  death,  to  support  the 
child,  would  never  be  questioned,  although  much  more 
should  be  secured  than  the  legal  interest  which  the  child 
had  in  the  protection  of  his  father. 

[§  103  A.  Daughter  ;  Granddaughter  ;  Nephew  ;  Son-in-law. 
—  A  daughter  cannot  insure  the  life  of  her  mother  unless 
she  has  a  pecuniary  interest  in  it.^  (a)    A  granddaughter  has 

1  The  observation  of  Bayley,  J.,  in  Halford  v.  Kymer,  that  it  was  a  matter 
of  indifference  to  tlie  fatlier  whether  he  was  supported  by  the  son  or  by  the 
parish,  entirely  overlooked  the  ground  of  expectation  arising  out  of  affection 
and  filial  duty. 

2  [Continental  Life  Ins.  Co.  v.  Volger,  89  Ind.  572.] 

(«)  One  who  is  by  statute  made  son  and  mother  under  the  statutes  of 
liable  for  the   support   of  another,   as     Illinois,  has  not  an  insurable  interest 

184 


CU.  YI.]  SUBJECT-MATTER.  —  IXSURABLE   INTEREST.         [§  104 

not,  as  such,  any  insurable  interest  in  the  life  of  her  grand- 
father.^ (a)  A  "nephew  has  not,  as  such,  an  insurable  inter- 
est in  the  life  of  an  aunt. ^(5)  A  son-in-law  has  no  insurable 
interest  in  the  life  of  his  mother-in-law, ^(e)  and  her  exe- 
cutor can  recover  the  funds  from  the  son's  assignee.^] 

§  104.  Father  in  Life  of  Son.  —  As  to  what  constitutes  an 
insurable  interest  under  a  life  policy,  we  may  observe,  as 
has  heretofore  been  observed  with  reference  to  fire  insur- 
ances, that  the  tendency  of  the  courts  has  been  from  strict- 
ness to  liberality.  It  was  early  intimated,  if  not  expressly 
held,  that  the  interest  must  be  a  pecuniary  interest,  and 
therefore  a  father  could  not  insure  the  life  of  his  son.  The 
value  of  the  interest  in  such  a  case,  said  the  court,  is  not  a 
farthing.^  The  case  was  that  of  a  minor  son,  upon  whose 
arrival  at  his  majority  depended  the  vesting  of  a  large  sum 
of  money  under  a  settlement.  The  insurance  was  for  two 
years,  the  minor  being  nineteen  and  a  few  months  at  the 
time  the  insurance  was  effected,  and  the  object  was  to  guard 
against  the  failure  of  the  settlement  to  vest,  in  case  of  the 
death  o*f  the  minor  before  his  majority.  As  the  money 
was  to  go  to  the  son  if  he  lived,  doubtless  the  father  had  no 
direct  pecuniary  interest  in  that.  The  plaintiff  pressed  the 
point,  however,  on  the  ground  that  he  had  an  interest  in  the 

1  [Burton  v.  Conn.  Mut.  Life  Ins.  Co.,  18  Ins.  L.  J.  713  ;  19  Ins.  L.  J.  75 
(Ind.),  May,  1889.] 

2  [Appl.  of  Corson,  113  Pa.  St.  438.] 

3  [Rombach  v.  Piedmont,  &c.  Life  Ins.  Co.,  35  La.  An.  233.] 

*  [Stambaugh  v.  Blake,  1  Monaghan  (Pa.),  609.  In  this  case  a  curious  effort 
was  made  to  prove  that  the  son  supported  the  mother-in-law,  as  though  that  gave 
him  an  interest  in  her  life.] 

5  Halford  v.  Kymer,  10  B.  &  C.  725. 

in  such  other's  life,  in  the  absence  of  of  her  stepmother.     Albert  v.  Mutual 

any  right  to  services  or  maintenance.  L.  Ins.  Co.,  122  N.  C.  92. 

People's  Mut.  Benefit  Society  v.  Tem-  (c)  Stambaugli  i-.  Blake,  1  Jlonaghan 

pleton,  16  Ind.  App.  126.  (Pa.),  609.      One  may  have  an  insur- 

(a)  Burton  v.  Conn.  Mut.  L.  Ins.  able  interest  in  the  life  of  a  step-sister 
Co.,  119   Ind.   207.  whom  he  has  agreed  to  care  for  and  help 

(b)  Nor  has  an  uncle  in  the  life  of  maintain.  Barnes  v.  London,  &c.  Ass. 
his  minor  nephew  whom  he  supports  :  Co.,  [1892]  1  Q.  B.  864.  That  a  parent 
Prudential  Ins.  Co.  v.  Jenkins,  15  Ind.  now  has  an  insurable  interest  in  his 
App.  297  ;  nor  has  a  woman  in  the  life  child's  life,  was  held  in  Wakeraan  v. 

Met'n  L.  Ins.  Co.,  30  Ontario,  705. 
185 


§  105]  INSURANCE  :    FIRE,  LIFE,    ACCIDENT,   ETC.  [CH.  VI. 

services  of  his  son,  and  upon  the  further  ground  that  in  case 
of  need  the  son  would  be  bound  to  support  him.  The  court 
seemed  to  rely  upon  Innes  v.  The  Equitable  Assurance  Com- 
pany, cited  by  Mr.  Justice  Bayley,  as  having  been  tried  be- 
fore Lord  Kenyon,!  where  the  plaintiff,  in  order  to  show  an 
interest  in  the  life  of  his  daughter,  offered  a  will  by  which 
he  was  to  receive  a  certain  sum  of  money  contingent  upon 
the  life  of  his  daughter.  The  will  was  proved  to  be  a  for- 
gery, however,  and  apparently  the  defendants  had  a  verdict 
on  that  ground.  There  was  no  discussion  of  the  question 
whether  an  insurable  interest  existed  on  other  grounds,  but, 
as  Lord  Tenterden  says,  it  was  in  effect  admitted  in  that 
case  that  it  was  necessary  to  prove  that  the  father  had  a 
pecuniary  interest  in  the  life  of  his  daughter. 

§  105.  But  the  law  has  been  held  differently  in  this  coun- 
try, and  it  has  been  determined  that  though  a  father,  as 
such,  may  have  no  insurable  interest,  resulting  merely  from 
that' relation,  in  the  life  of  a  child  of  full  age,  yet  if  that  son 
is  a  minor  of  such  age  as  to  render  valuable  services,  and  to 
whom  advances  have  been  made,  there  can  be  no  doubt  of 
the  father's  insurable  interest  in  his  life.  The  father  is 
entitled  to  the  earnings  of  such  child,  and  may  maintain  an 
action  for  their  recovery.  So  he  may  maintain  an  action 
for  the  loss  of  his  services  if  the  child  be  injured.  Hence 
he  has  a  pecuniary  interest  which  the  law  will  protect  and 
enforce.^  Nor  is  it  easy  to  see  why,  upon  the  principles 
laid  down  in  Lord  v.  Dall,  and  stated  in  the  plaintiff's  argu- 
ment in  Halford  v.  Kymer,^  by  reason  of  the  relationship 
and  its  attendant  rights  and  obligations,  an  aged  father,  no 
longer  capable  of  self-support,  and  actually  supported  by  his 
son  who  has  passed  his  majority,  and  who  both  by  natural 
affection  and  by  law  is  bound  to  contribute  to  his  support, 
has  not  an  insurable  interest  in  the  life  of  that  son.      It  is 

1  This  case  is  not  reported  ;  but  it  is  referred  to  and  stated  most  fully  in  4 
Lon.  Law  Mag.  373,  where  Lord  Tenterden  is  reported  to  have  said,  at  the  argu- 
ment in  Halford  v.  Kymer,  that  they  could  not  give  judgment  for  the  plaintiff 
without  flying  in  the  teeth  of  the  case  tried  by  Lord  Kenyon. 

2  Mitchell  V.  Union  Life  Ins.  Co.,  45  Me.  104. 
8  10  B.  &c.  725. 

186 


CH.  VI.]  SUBJECT-MATTER.—  INSURABLE   INTEREST.         [§  106 

precisely  this  natural  affection,  combined  with  the  legal 
obligation  to  support,  which  by  universal  consent  gives  to 
the  child  an  insurable  interest  in  the  life  of  the  father.  A 
son  arrived  at  his  majority  may,  in  point  of  fact,  have  no 
need  of  his  father's  assistance,  but  the  legal  obligation  of 
the  parent  to  save  the  child  from  becoming  an  object  of 
public  charity  gives  to  the  child  an  insurable  interest  in  the 
father.  The  same  legal  obligation  of  the  child  towards  the 
father  ought  to  give  the  father  the  like  interest  in  the  life  of 
the  child. 

§  106.  And  to  this  extent  the  following  case  in  Massa- 
chusetts would  seem  to  go,  though  it  was  not  necessary  so  to 
decide  upon  the  facts  in  the  case,  which  were  as  follows :  — 

On  the  2d  day  of  February,  1849,  the  plaintiff's  intestate 
insured  for  seven  years  the  amount  of  f^TOO  on  the  life  of  a 
minor  son  who  was  about  to  proceed  to  California,  and  who 
would  become  of  age  on  the  6th  day  of  the  following  Janu- 
ary. The  wages  of  the  son  had  been  taken  by  the  father  and 
appropriated  to  the  support  of  the  family.  It  was  agreed 
between  the  son  and  a  third  person  who  had  advanced  him 
money  with  which  to  prosecute  the  enterprise  that  that  third 
person  should  receive  one-half  his  net  earnings.  To  this 
agreement  the  father  assented ;  he  also  provided  an  outfit 
for  the  son.  The  son  died  on  board  ship  on  the  1st  day  of 
December,  1849,  soon  after  his  arrival  in  California.  It 
was  held  that  the  father  had  an  insurable  interest  at  the 
time  of  such  minor  son's  death. ^  And  the  same  doctrine 
was  more  recently  directly  asserted  in  Pennsylvania. ^ 

1  "  We  understand,"  said  the  court,  "that  the  law  of  Connecticut,  where  the 
parties  resided,  is  similar  to  that  of  Slassaclmsetts,  and  that  by  the  law  of  both 
States  a  father  who  supports,  maintains,  and  educates  a  son  under  twenty-one 
years  of  age,  and  not  emancipated,  is  entitled  to  the  earnings  of  such  son,  and 
^niay  maintain  an  action  for  them.  Here,  where  the  father  had  in  terms  relin- 
quished his  right  to  a  share  in  the  son's  earnings  for  a  valuable  stipulation  on  the 
other  side,  designed  and  intended  to  increase  those  earnings,  by  a  necessary  im- 
plication he  reserved  his  right  to  the  other  share  of  those  earnings.  According  to 
any,  the  strictest,  rule  of  construction,  the  assured,  we  think,  had  a  direct  and 
pecuniary  interest  in  the  life  of  the  cestui  que  vie,  his  sou.     It  is  argued  that  the 


2  Reserve  Life  Ins.  Co.  v.  Kane,  81   Pa.  St.  154.     See  also  Connecticut  JIut. 
Life  Ins.  Co.  v.  Schaefer,  94  U.  S.  457. 

187 


§  107']         insurance:  fire,  life,  accident,  etc.        [ch.  vi. 

§  107.  Still  it  may  not  be  safe  to  advance  from  the  cases 
just  stated  to  the  general  propositions  that  a  father  may  in- 
sure the  life  of  any  minor  child,  and  that  a  sister  may  in- 
sure the  life  of  any  brother.     In  one  case,i  in  reply  to  the 

time  wliich  would  reniaiu  after  his  probable  arrival  in  California,  before  becoming 
of  age,  would  be  so  short  that  his  earnings,  if  anything,  would  be  very  small. 
Supposing  he  was  to  have  a  passage  of  three  or  five  months,  he  might  still  hav^ 
five  or  six  months  to  work  in  California  ;  and  this  being  a  contract  dealing  with 
chances  and  probabilities,  and  even  possibilities,  and  to  be  construed  as  such,  it 
may  well  be  supposed  that  the  parties  had  it  in  contemplation  that  by  working  a 
few  weeks  or  days  in  a  gold-mine,  or  by  a  lucky  hit  in  a  single  day,  he  might 
gain  gold  enough  to  make  his  share  exceed  the  whole  sum  insured.  But  nearness 
or  remoteness  of  this  chance  is  immaterial  ;  the  parties  regulate  this  matter  for 
themselves,  in  fixing  the  sum  to  be  insured  and  the  rate  of  premium.  It  seems 
to  us,  therefore,  that,  according  to  the  rale  relied  on  by  the  defendants,  the 
assured  in  the  present  case  had  a  direct  and  pecuniary  interest  in  the  life  of  the 
son,  sufficient  to  enable  him  to  maintain  this  action. 

"  But,  upon  broader  and  larger  grounds,  we  are  of  opinion  that,  indepen- 
dently of  the  fact  that  the  son  was  a  minor,  and  the  assured  had  a  pecuniary 
interest  in  his  earnings,  the  assured  had  an  insurable  interest  sufficient  to  main- 
tain this  action. 

"  The  case  in  this  State  must  be  governed  by  the  rules  and  principles  of  the 
common  law,  there  being  no  regulation  of  the  subject  by  statute  ;  and  the  stat- 
ute of  14  Geo.  III.  c.  48,  passed  about  the  time  of  the  commencement  of  the 
Revolution,  never  having  been  adopted  iii  this  State.  All,  therefore,  which  it 
seems  necessary  to  show,  in  order  to  take  the  case  out  of  the  objection  of  being  a 
wager  policy,  is  that  the  insured  has  some  interest  in  the  life  of  the  cestui  que  vie  ; 
that  his  temporal  affairs,  his  just  hopes,  and  well-grounded  expectations  of 
support,  of  patronage,  and  advantage  in  life  will  be  impaired  ;  so  that  the  real 
purpose  is  not  a  wager,  but  to  secure  such  advantages,  su]iposed  to  depend  upon 
the  life  of  another  ;  such,  we  suppose,  would  be  sufficient  to  prevent  it  from  being 
regarded  as  a  wager.  Whatever  may  be  the  nature  of  such  interest,  and  whatever 
the  amount  insured,  it  can  work  no  injury  to  the  insurers,  because  the  premium 
is  proportioned  to  the  amount ;  and  whether  the  insurance  be  to  a  large  or  small 
amount,  the  premium  is  computed  to  be  a  precise  equivalent  for  the  risk  taken. 
Perha[)S  it  would  be  difficult  to  lay  down  any  general  rule  as  to  the  nature  and 
amount  of  interests  which  the  assured  must  have.  One  thing  may  be  taken  as 
settled,  — that  every  man  has  an  interest  in  his  own  life  to  any  amount  at  which 
he  chooses  to  value  it,  and  may  insure  it  accordingly. 

"We  cannot  doubt  that  a  parent  has  an  interest  in  the  life  of  a  child,  and, 
vice  versa,  a  child  in  the  life  of  a  parent ;  not  merely  on  the  ground  of  a  ptovision 
of  law  that  parents  and  grandparents,  children  and  grandchildren,  are  bound  to 
support  their  lineal  kindred  when  they  stand  in  need  of  relief,  but  upon  con- 
siderations of  strong  morals  and  the  force  of  natural  afl"ection  between  near  kin- 
dred, operating  often  more  efficaciously  than  those  of  positive  law."  Loomis, 
Adm'r,  v.  Eagle  Life  &  Health  Ins.  Co.,  6  Gray  (Mass.),  396,  opinion  per  Shaw, 
C.  J.  ;  Hoyt  v.  New  York  Life  Ins.  Co.,  3  Bosw.  (N.  Y.  Superior  Ct.)  440  ; 
Miller  v.  Eagle  Life  &  Health  Ins.  Co.,  2  E.  D.  Smith  (N.  Y.  C.  P.),  268  ; 
Williams  v.  Wash.   Life  Ins.  Co.,  31  Iowa,  541. 

1  Mitchell  V.  Union  Life  Ins.  Co.,  45  Me.  104. 
1S8 


CH.  VI.]  SUBJECT-MATTER. — INSURABLE   INTEREST.         [§107 

objection  that  the  policy  was  unsupported  by  any  insurable 
interest,  evidence  was  offered  that  the  father  had  furnished 
supplies  and  money  to  his  son  who  was  about  to  proceed  to 
California,  and  the  fact  of  these  advances  seems  to  have 
been  regarded  by  the  court  as  a  matter  of  significance.  In 
another  case,^  substantially  the  same  facts  existed,  with  the 
additional  fact  that  the  father  had  usually  received  the  earn- 
ings of  his  son,  and  had  specially  reserved  a  portion  of  them 
during  the  currency  of  the  policy.  Upon  this  latter  fact  the 
court  laid  considerable  stress,  and  held  only  that  in  that 
case  the  plaintiff  had  an  insurable  interest.  In  the  third 
case, 2  the  court  emphasize  the  fact  that  the  sister  had  been 
supported  and  educated  by  the  brother,  and  add,  that  no  one 
would  hesitate  to  say  that  in  the  life  of  such  a  brother  the 
sister  had  an  interest.  And  afterwards,^  in  speaking  of 
Lord  V.  Dall,  the  same  court  say  that  that  case  held  that  the 
insurable  interest  might  be  inferred  from  particular  circum- 
stances. So  that  it  is  by  no  means  certain  that  were  the 
circumstances  different,  —  as,  for  instance,  if  the  father 
were  to  insure  for  one  year  the  life  of  an  infant  son,  or  if 
the  son  were  to  insure  the  life  of  a  decrepit  and  pauper 
father,  or  a  sister  were  to  insure  the  life  of  a  brother  incap- 
able or  indisposed  to  assist  her,  there  being  in  either  case 
no  well-founded  expectation  of  pecuniary  advantage  from  the 
continuance  of  the  lives,  or  risk  of  loss  from  their  termina- 
tion, —  the  courts  would  see  in  such  circumstances  any  in- 
terest which  would  support  a  policy.  The  relationship, 
therefore,  seems  to  be  of  little  importance,  except  as  tend- 
ing to  give  rise  to  the  circumstances  which  justify  the 
expectation.  Indeed,  the  doctrine  of  the  latest  of  the  Mas- 
sachusetts cases  before  cited  is  broad  enough  to  cover  a  case 
where  there  is  no  relationship  at  all,  save  one  perhaps  of 
mere  friendship,  if  the  circumstances  are  such  as  to  show 
that  the  loss  of  the  insured  life  will  probably  result  in 
pecuniary  disadvantage  to  the  person  procuring  the  insur- 

1  Loomis,  Adm'r,  v.  Eagle  Life  &  Health  Ins.  Co.,  6  Gray  (Mass.),  396. 

2  Lord  V.  Dall,  12  Mass.  115. 

3  Loomis,  Adm'r,  v.  Eagle  Life  &  Health  Ins.  Co.,  ubi  supra. 

189 


§  107]         insurance:  fire,  life,  accident,  etc.        [ch.  vi. 

ance.  Upon  the  whole,  however,  it  yet  remains  to  be  de- 
cided whether  mere  relationship,  with  its  attendant  rights 
and  obligations,  as  between  father  and  son  reciprocally,  is  a 
sufficient  foundation  upon  which  to  rest  an  insurable  interest. 

(s)  The  cases  decided  since  the  first  edition  of  this  work 
was  published  are  not  perhaps  in  entire  accordance  with 
each  other.  On  the  one  hand,  it  has  been  distinctly  hold 
that  mere  relationship  of  father  and  son  did  not  give  the 
son  an  insurable  interest,  "  where  both  parties  are  of  mature 
years,  and  live  apart,  in  independent  pecuniary  circum- 
stances, and  mutually  entirely  independent  of  each  other, 
and  having  no  business  relations  with  each  other."  ^  So  one 
brother  has  been  held  to  have  no  insurable  interest  in  the 
life  of  another  on  the  mere  ground  of  relationship. ^  Per- 
haps both  cases  may  fairly  be  considered  as  deciding  only 
that  such  a  relationship  does  not  give  an  insurable  interest 
when  the  other  facts  and  circumstances  show  that  the  policy 
was  a  mere  speculation. ^  The  case  of  Insurance  Company 
V.  Bailey*  is  not  regarded  by  the  Supreme  Court  of  Illinois 
as  going  any  further  than  this.  In  Singleton  v.  St.  Louis 
Mutual  Life  Insurance  Company,^  a  nephew  was  held  to  have 
no  insurable  interest,  by  mere  relationship,  in  the  life  of  an 
uncle. 

(t)  On  the  other  hand,  mere  relationship  seems  to  have 
been  held  sufficient  to  support  a  policy  on  the  life  of  a  son 
in  favor  of  the  mother,  in  Reif  v.  Union  Mutual  Life  Insur- 
ance Company; 6  and  on  the  life  of  a  brother  in  favor  of  a 
sister.^  So  it  was  held  in  Kane  v.  Reserve  Mutual  Life  In- 
surance Company.^     A  sister  who  is  also  a  creditor  has  an 

1  Guardian  Mut.  Life  Ins.  Co.  v.  Hogan,  80  111.  35. 

2  Lewis  V.  Phoenix  Mut.  Life  Ins.  Co.,  39  Conn.  100. 

3  See  also  Cammack  v.  Lewis,  15  Wall.  (U.  S.)  643. 
<  13  Wall.  (U.  S.)  fil6,  619. 

6  66  Mo.  63. 

'  Superior  Court,  Cincinnati,  at  Nisi  Prius,  17  Ins.  Chronicle,  p.  3. 

7  .Etna  Life  Ins.  Co.  v.  France,  94  U.  S.  561.  See  also  Conn.  Mut.  Life  Ins. 
Co.  V.  Schaefer,  94  U.  S.  457. 

8  9  Phila.  234.  But  see  same  case  in  Supreme  Court,  81  Pa.  St.  151,  where 
it  is  said  that  the  relationship  prevents  the  policy  from  being  a  mere  wager,  as 
under  the  poor-laws  the  son  may  have  to  support  the  father. 

190 


CH.  VI.]  SUBJECT-MATTER.  —  INSURABLE   INTEREST.       [§107  6 

insurable    interest  in  the   life   of   her    brother  beyond   the 
debt.i 

§  107  a.  Loss  ;  Feme  Sole  under  Contract  of  Marriage,  — 
In  Chisholm  v.  National  Capital  Life  Insurance'  Company, 
the  plaintiff,  who  was  the  betrothed  of  one  Clark,  and  for 
whom  he  had  taken  out  a  policy  on  his  life,  payable  to  her, 
was  allowed  to  recover.  The  insurable  interest  at  the  incep- 
tion of  the  contract  was  sufficient,  if  any  were  necessary,  of 
which  the  court  intimated  a  doubt,  in  the  absence  of  evidence 
tending  to  show  the  contract  was  a  wagering  one,  or  against 
public  policy.  The  plaintiff  had  an  interest  in  the  life  of  Clark, 
as  a  valid  contract  of  marriage  was  subsisting  between  them. 
Had  he  lived  and  violated  the  contract,  she  would  have  had 
her  action  for  damages ;  had  he  observed  and  kept  the  contract, 
thpn  as  his  wife  she  would  have  been  entitled  to  support.  ^ 

The  question,  what  is  such  an  interest  in  the  life  of  an- 
other as  will  support  a  contract  of  insurance  upon  the  life, 
is  one  to  which  a  complete  and  satisfactory  answer,  resting 
upon  sound  principles,  can  hardly  yet  be  said  to  have  been 
given.  As  the  premium  is  intended  to  be  a  precise  equiva- 
lent for  the  risk  taken,  it  would  seem  that  the  contract  is  a 
just  and  equitable  one,  whether  any  interest  in  the  life 
exists  or  not;  and  that  the  only  essential  inquiry  is,  whether 
the  object  of  the  contract  is  such  as  to  obviate  the  objections 
to  a  mere  wager  upon  the  chances  of  human  life.^ 

§  107  h.  Wife  in  Husband.  —  Of  course,  and  for  similar 
reasons,  the  wife  has  an  insurable  interest  in  the  life  of  her 
husband.*  And  it  has  been  held  that  a  divorce  obtained  at 
the  instance  of  the  wife,  for  whose  benefit  the  life  of  the 
husband  has  been  insured,  will  not  deprive  the  wife,  who 
has  children  and  supports  them,  of  a  right  to  recover.     The 

1  Goodwin  v.  Mass.  Mut.  Life  Ins.  Co.,  73  N.  Y.  480. 

'■^  52  Mo.  213.  But  see  this  case  commented  upon  and  limited  in  Singleton  v. 
St.  Louis  Mut.  Life  Ins.  Co.,  QQ  Mo,  63. 

8  Forbes  v.  American  Mut.  Life  Ins.  Co.,  15  Gray  (Mass.),  249.  Substan- 
tially the  same  observation  was  made  in  Anderson  v.  Morice,  25  W.  R.  14,  as 
to  insurable  interests  generally. 

*  Baker  v.  Union  Mut.  Life  Ins.  Co.,  43  N.  Y.  283  ;  St.  John  v.  American 
Mut,  Life  Ins.  Co.,  2  Duer  (N,  Y.),  419  ;  Gambs  v.  Covenant  Life  Ins.  Co.,  50 
Mo.  44.     See  also  Reed  v.  Royal  Ex.  Ass.  Co.,  Peake's  Ad,  Cas,  70, 

191 


§  108]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,    ETC.  [CH.  VI. 

insurable  interest  remains  sufficient  to  support  the  policy. 
Altliou"h  divorced,  the  children  whom  she  is  supporting 
may  look  to  the  father  for  support.  That  the  care  and  cus- 
tody of  the  children  are  decreed  to  her  does  not  extinguish 
the  obligation  of  the  father  to  provide  for  them.  And  he 
also  may  be  required  by  the  court  to  contribute  by  way  of 
alimony,  or  otherwise,  to  the  support  of  his  former  wife.^ 
And  it  seems  that  a  woman  living  unlawfully  with  a  man  as 
his  wife,  and  treated  and  supported  by  him  as  such,  has  an 
insurable  interest  in  his  life.^ 

[§  107  C.  Husband  in  Wife's  Life.  —  The  presumption  is 
that  a  husband  has  an  insurable  interest  in  the  life  of  his 
wife.  He  is  entitled  to  her  service  and  companionship. 
She  may  be  a  burden,  as,  if  she  is  a  hopeless  maniac  or  in- 
valid, and  such  facts  when  shown  may  require  a  different 
rule,  but  in  the  absence  of  such  evidence  the  husband  as 
such  has  an  insurable  interest.  ^  The  objection  that  the 
plaintiff  had  no  insurable  interest  comes  with  very  bad  grace 
from  a  company  that  has  received  two  or  three  thousand  dol- 
lars of  the  plaintiff's  money  on  a  policy  issued  with  knowl- 
edge of  the  very  facts  which  it  objects  to  now  as  insufficient 
to  create  an  insurable  interest.*] 

§  108.  Creditor  in  Debtor.  —  That  a  creditor  has  an  insur- 
able interest  in  the  life  of  his  debtor  was  adjudged  in  a  very 
early  case.  The  means  by  which  the  debt  is  to  be  satisfied 
may  very  materially  depend  upon  the  continuance  of  the  life 
of  the  debtor,  and  at  all  events  the  death  of  the  debtor  must 
in  all  cases  in  some  degree  lessen  the  chances  of  payment.  ^ 
The  point  was  made  also  in  a  very  early  case  that,  if  the 
debtor  was  an  infant  who  might  interpose  as  against  his 
creditor  the  plea  of  infancy,  this  contingency  took  the  debt 
out  of  the  category  of  insurable  interests.     But  though  the 

1  McKee  v.  Phoenix  Ins.  Co.,  28  Mo.  383.     See  also  post,  §  391. 

2  E(iuitable  Life  Assurance  Soc.  v.  Paterson,  41  Ga.  338.     And  see  post,  §  305. 
8  [Currier  v.  Continental  Lite  Ins.  Co.,  57  Vt.  496,  500.] 

*  Ibid. 

5  Anderson  v.  Edie,  Park,  Ins.  432.  [A  creditor  has  an  insurable  interest  also 
in  the  life  of  his  debtor.  Amick  v.  Butler,  111  Ind.  578;  Parks  v.  Conn.  Ins. 
Co.,  26  Mo.  App.  511.] 

192 


CH.  yi.]  SUBJECT-MATTER.  —  INSURABLE   INTEREST.         [§108 

point  was  not  decided,  it  was  strongly  intimated  that  the 
debt,  till  avoided,  must  be  taken  as  the  debt  of  an  adult,  as 
against  a  third  person,  since  the  debtor  only  could  take  the 
objection.  1  The  debt  is  not  void,  but  only  voidable,  and  if 
for  necessaries  not  even  that.^  Upon  the  same  principles, 
if  the  debt  be  one  to  which  the  Statute  of  Limitations  might 
be  pleaded  at  the  time  of  the  death  of  the  debtor,  it  never- 
theless constitutes  an  interest  which  will  support  a  policy. 
A  debt  still  exists.  It  is  not  extinguished  by  the  currency 
of  the  statute,  as  in  the  case  of  payment.  It  may  be  revived 
by  a  new  promise,  and  indeed  without  such  promise  be  en- 
forced by  action,  unless  the  defence  of  the  statute  be  inter- 
posed. The  law  does  not  presume  that  a  new  promise  will 
be  refused  or  the  defence  of  the  statute  interposed.  ^  And 
there  can  be  no  doubt  that  the  same  would  be  the  case, 
though  the  statute  had  run  against  the  debt  at  the  time  of 
the  insurance,  and  for  the  same  reasons.  So  has  an  execu- 
tor an  insurable  interest  in  the  life  of  his  testator's  debtor.^ 

But  though  the  law  will  allow  a  creditor  to  protect  him- 
self by  insuring  the  life  of  the  debtor,  the  insurance  will  not 
be  supported,  if  it  appears  from  the  great  disparity  between 
the  debt  and  the  amount  insured,  or  otherwise,  that  the 
transaction  is  rather  one  of  speculation  than  of  protection.^ 

[The  creditor  is  only  entitled  to  indemnity.  If  the  debt 
and  all  premiums  and  expenses  are  paid  to  him,  the  insur- 
ance inures  to  the  benefit  of  the  debtor  or  his  sureties.^ 

1  Dwyer  v.  Edie,  Park,  Ins.  432.     See  also  ante,  §  80. 

2  Rivers,  Adm'r,  v.  Gregg,  5  Rich.  Eq.  (S.  C.)  274. 

3  Rawls  V.  American  Mut.  Life  Ins.  Co.,  27  N.  Y.  (13  Smith)  282,  affirming 
s.  c.  36  Barb.  (N.  Y.)  357.     And  see  post,  §  117,  n, 

*  Garner  v.  Moore,  3  Drewry,  277. 

6  Fox  V.  Pennsylvania  Mut.  Life  Ins.  Co.,  Dist.  Ct.  of  Phila.  ;  s.  c.  4  Big.  L. 
&  A.  Ins.  Cas.  458.  The  verdict  in  the  case  for  the  plaintiff  was  set  aside.  [A 
creditor  for  $300  who  had  paid  about  §500  on  abandoned  policies  on  the  life  ot 
his  debtor,  insured  it  again  for  §3000  and  received  the  whole  amount,  which  the 
courts  allowed  him  to  hold  against  the  representatives  of  the  debtor,  on  the 
gi'ound  that  the  evidence  did  not  show  the  insurance  to  be  merely  collateral,  that 
the  disproportion  did  not  render  the  policy  a  wager,  and  that  it  was  neither 
illegal  nor  immoral  for  the  creditor  to  assure  the  sums  he  had  fruitlessly  paid  on 
other  policies  on  the  same  life,  as  well  as  the  debt.  Grant's  Adm'rs  v.  Kline,  115 
Pa.  St.  618.] 

6  [See  100  A,  117,  and  ch.  24.] 

VOL.  I. —  13  •  193 


§  109]  INSURANCE  :    FIRE,    LIFE,   ACCIDENT,   ETC.  [CH.  VI 

Wlien  a  debtor  and  a  surety  entered  into  a  bond  to  secure 
payment  by  instalments  of  a  debt,  and  the  expenses  of  effect- 
ing a  policy  on  the  debtor's  life  as  a  collateral  security,  and 
when  after  a  time  the  creditor  was  obliged  to  pay  the  pre- 
miums, as  neither  debtor  nor  surety  would  do  so,  it  was  held 
on  the  death  of  the  debtor  that  it  still  accrued  to  the  benefit 
of  the  surety  on  repayment  of  the  amounts  paid  by  the  cred- 
itor.^ But  a  creditor  who,  acting  for  himself  and  not  under 
agreement  with  or  as  agent  of  the  debtor,  insures  the  life  of 
his  debtor,  will  not  have  his  right  to  recover  affected  by  a 
subsequent  payment  of  the  debt.^  The  premium  as  well  as 
the  debt  must  be  paid  to  destroy  his  claim,  and  that  cannot 
be  done  by  the  company.  It  has  received  payment  for  the 
risk  and  cannot  escape  it. 

No  only  one  who  is  a  creditor,  but  one  who  has  entered  into 
an  obligation  which  may  inake  him  a  creditor  on  a  certain  con- 
tingency has  an  insurable  interest.  A  surety  on  an  official 
bond  has  an  insurable  interest  in  the  life  of  the  obligor. ^J 

§  109.  Modes  of  Insurance  on  Debtor's  Life.  —  The  life 
of  a  debtor  may  be  insured  in  two  ways.  The  debtor  may 
insure  to  an  amount  beyond  the  debt  for  the  benefit  of  his 
creditor,  and  payable  in  case  of  loss  to  the  creditor,  in  trust, 
first  to  pay  the  debt,  and  then  to  pay  the  balance  to  such 
parties  as  the  debtor  may  designate;*  or  the  creditor  may 
insure  the  life  of  his  debtor  to  the  amount  of  the  debt,  pay- 
able to  himself  in  case  of  loss.  And  if  a  creditor  without 
fraud,  and  in  ignorance  of  the  law,  insures  the  life  of  his 
debtor  for  a  larger  amount  than  the  debt,  he  may  recover 
back  the  excess  of  premium.^  The  creditor  may  also  insure 
the  life  of  one  of  two  joint  makers  of  a  note,  although  the 
other  be  entirely  able  to  pay  the  debt,  and  the  estate  of  the 
insured  be  solvent;  and  he  may  recover  the  whole  amount 
insured.^     And  if  the  creditor  be  a  firm  and  the  debtor  be  a 

1  [Drysdale  v.  Pigot,  8  De  G.  M.  &  G.  546.] 

"  [Ferguson  v.  Mass.  Mut.  Life  Ins.  Co.,  32  Hnn,  306.] 

«  [Scott  V.  Dickson,  108  Pa.  St.  6.] 

*  American  Life  &  Health  Ins.  Co.  v.  Robertshaw,  26  Pa.  (2  Casey)  189. 

6  London,  &c.  Life  Ins.  Co.  v.  Lapierre,  Q.  B.  (L.  C.)  1878,  8  Ins.  L.  J.  79. 

6  Morrell  v.  Trenton  Mut.  Life  &  Fire  Ins.  Co.,  10  Gush.  (Mass.)  282. 
194 


CH.  VI.]  SUBJECT-MATTEE.  —  INSURABLE    INTEREST.        [§109  5 

firm,  each  member  of  the  creditor  firm  has  an  insurable  in- 
terest in  the  life  of  each  member  of  the  debtor  firm.^ 

§  109  a.  Partner  in  Copartners.  —  A  case  of  some  novelty 
in  its  facts  has  been  before  the  courts  of  New  York,  recog- 
nizing an  insurable  interest  in  services  agreed  to  be  ren- 
dered. Three  persons  entered  into  a  copartnership,  two  of 
them  putting  in  the  cash  capital,  and  the  third,  who  und<  i- 
stood  the  business,  putting  in  his  skill  as  against  the  capi- 
tal of  the  other  two.  And  it  was  held  that  the  two  putting 
in  their  capital  had  an  insurable  interest  in  the  life  of  the 
other,  as  his  death  would  deprive  them  of  his  skill  and  ser- 
vices contributed  to  the  common  stock  in  lieu  of  cash  capi- 
tal. ^  {a)  [Where  A.  and  B.  went  into  partnership  with  a 
capital  of  810,000,  and  A.  furnished  B. 's  half,  A.  was  held 
to  have  an  insurable  interest  in  B.  's  life  to  the  extent  of  the 
moiety  of  the  capital,  without  respect  to  the  state  of  partner- 
ship accounts  and  profits,  unless  the  estimate  of  his  interest 
at  the  time  of  the  application  was  made  in  bad  faith. ^] 

§  109  h.  Interest  in  Future  Earnings  of  the  Insured  under  a 
Contract.  —  Somewhat  analogous  to  the  relation  of  debtor 
and  creditor  is  that  of  a  party  who  advances  funds  to  an- 
other to  enable  him  to  prosecute  an  enterprise,  under  the 
agreement  that  the  party  so  advancing  the  funds  shall  be 
entitled,  in  consideration  therefor,  to  a  portion  of  the  profits 

1  Rawls  V.  American  Life  Ins.  Co.,  36  Barb.  (N.  Y.)  347  ;  s.  c.  27  N.  Y.  (13 
Smith)  282. 

2  Valton  V.  National  Loan  Fund  Life  Assurance  Soc,  22  Barb.  (ISr.  Y.)  9. 
The  case  subsequently  went  to  the  Court  of  Appeals  (20  N.  Y.  32),  where  the 
judgment  of  the  court  below  was  affirmed. 

3  [Conn.  Mut.  Life  Ins.  Co.  v.  Luchs,  108  U.  S.  498,  505,  508.] 

(a)  A  partner  has  no  necessary  in-  v.  Anders,  87  Texas,  287.     See  Powell 

surable  interest  in  the  life  of  his   co-  v.    Dewey,   123    N.    C.   103.      Where  a 

partner  :    Powell  v.  Dewey,   123  N.  C.  partner  misappropriated  money   of  the 

103  ;  or  in  the  latter's  houseliold  furni-  firm  and  applied  it  to  the  purchase  of 

ture.     Georgia  Home  Ins.  Co.  v.   Hall,  policies  on  his  life  for  the  benefit  of  his 

94  Ga.  630.      A  partnership's  insurable  wife,  the  firm  was  held  entitled,  on  the 

interest  in  the  life  of  one  of  its  members,  death  of  the  partner,  to  recover  the  en- 

who  is  not  indebted  to  it,  is  limited  to  tire  amount  of  insurance,  it  having  been 

such  premiums  on  his  policy  as  are  paid  purchased  exclusively  witli  their  money, 

out  of  the  firm  assets  and  interest  there-  and   not   merely   the   premiums    paid, 

on,   his   heirs   or   legal   representatives  Holmes  v.  Gilman,  138  N.  Y.  369. 
being  entitled  to  the  residue.     Cheeves 

195 


llOg?*]         insurance:    FIRE,  LIFE,   ACCIDENT,   ETC.  [CH.  VI. 

of  the  enterprise  accruing  within  a  certain  time.  Here  there 
is  no  debt,  but  only  an  obligation  to  pay  over  a  portion  of 
.the  profits  earned  within  a  certain  period,  if  any  shall  be 
earned.  This  kind  of  contract  was  frequent  in  the  early 
days  of  the  Californian  gold  excitement,  and  it  has  been 
frequently  held  that  such  a  contract  gave  the  party  furnish- 
iu'T  the  advance  and  outfit  an  insurable  interest  in  the  life 
of  the  person  who  was  to  prosecute  the  enterprise.^  The 
amount  of  the  insurable  interest  in  such  cases  must  be  left 
to  the  determination  of  the  parties.  It  does  not  depend  at 
all  upon  the  amount  of  advances  and  the  cost  of  outfit.  Of 
course  the  amount  of  earnings  or  profits  which  may  be 
acquired  in  such  cases  is  wholly  conjectural,  and  whatever 
the  amount  agreed  upon  by  the  parties  in  good  faith  may  be, 
this  will  be  taken  to  he  the  value  of  the  interest  in  case  of 
loss,  as  upon  a  valued  policy,  which  the  plaintiff  will  be 
entitled  to  recover.  There  seems  to  be  no  limit  to  the 
amount  which  may  be  fixed  as  the  value  of  the  loss.  If  the 
party  effecting  the  insurance,  under  the  influence  of  exag- 
gerated expectations,  is  desirous  to  fix  the  prospective 
profits  at  a  large  sum,  and  is  willing  to  pay  proportionably 
in  the  shape  of  premiums,  there  seems  to  be  no  reason  why 
the  insurers  should  not  accept  the  obligation.  It  is  the 
same  thing  to  them,  so  far  as  the  risk  is  concerned,  whether 
they  take  a  small  risk  or  a  large  one,  except  that,  if  there  is 
a  profit  on  the  small  one,  there  will  be  a  proportionably 
greater  profit  on  the  larger  one.^  It  may  be  presumed, 
however,  that,  if  the  valuation  should  be  fixed  at  so  large  a 
sum  as  to  warrant  the  belief  that  the  transaction  was  merely 
a  cover  and  with  intent  to  evade  the  law,  the  courts  would 
hold  such  a  policy  void  as  a  wager. ^  If  it  be  objected  that 
such  an  interest  is  analogous  to  the  case  of  expected  profits, 

1  Bevin  v.  Connecticut  Mut.  Life  Ins.  Co.,  23  Conn.  244;  Morrell  v.  Trenton 
Mut.  Life  &  Fire  Ins.  Co.,  10  Cush.  (Mass.)  282  ;  Hoyt  v.  New  York  Life  Ins. 
Co.,  3B0.SW.  (N.  Y.  Sup.  Ct.)  440  ;  Miller  v.  Eagle  Life  &  Health  Ins.  Co., 
2  E.  D.  Smith  (N.  Y.  C.  P.),  268  ;  Trenton  Mut.  Life  &  Fire  Ins.  Co.  v.  Johnson, 
4Zab.  (N.  J.)  576,  577. 

2  Ibid. 

3  Miller  v.  Eagle,  &c.  Ins.  Co.,  vbi  supra.  See  also  Wainewright  v.  Bland,  1 
Moody  &  Kob.  481  ;  Fo.x  v.  Penn.,  &c.  Ins.  Co.,  ante,  §  108. 

196 


CH.  VI.]  SUBJECT-MATTER.  —  INSURABLE   INTEREST,       [§  109  0 

and  that  such  are  not  insurable  unless  insured  specifically, 
it  is  to  be  replied  that  an  insurance  upon  a  life  is  not  an 
insurance  of  the  life ;  it  is  rather  an  insurance  of  the  bene- 
fits to  result  to  the  insured  from  the  continuance  of  the  life. 
These  are  all  that  render  the  life  valuable  to  him.  No 
pecuniary  value  can  be  set  upon  the  life  as  upon  property. 
Life  cannot  be  the  subject  of  valuation  and  sale.  Labor  and 
services,  or  the  proceeds  thereof,  may  be.  A  wife  recovers 
upon  an  insurance  on  her  husband's  life,  in  view  of  the 
benefits  to  result  to  her  from  the  continuance  of  his  life ;  not 
because  the  life  is  of  any  value,  irrespective  of  its  devotion 
to  her  support  and  maintenance.  A  creditor  recovers  upon 
the  death  of  his  debtor,  not  because  the  life  of  the  deceased 
was  worth  the  amount  of  the  debt,  but  because  the  expecta- 
tion of  payment  of  the  debt  is  destroyed  or  impaired  by  the 
death.  The  insurance  upon  a  life  is  in  itself  in  the  nature 
of  an  insurance  upon  profits.  The  very  idea  of  a  pecuniary 
interest  in  the  life  of  another  involves  a  claim,  not  to  the 
life  itself,  but  to  some  benefit  resulting  from  or  growing  out 
of  that  life,  and  —  except  in  the  case  of  an  annuity,  deriv- 
able from  some  other  source,  but  to  endure  only  while  the 
life  shall  continue  —  it  involves  also  a  claim  upon  the  profits 
or  proceeds  accruing  from  the  employment  and  efforts  of  the 
person  whose  life  is  the  subject  of  the  insurance.  An  insur- 
ance, therefore,  upon  the  profits  of  a  life  specifically,  would 
involve  no  idea  that  is  not,  from  the  necessity  of  the  case, 
embraced  in  an  insurance  in  terms  upon  the  life  itself,^ 

§  109  e.  Employe  in  Employer  ;  Master  and  Servant.  —  It 
is  a  very  common  thing  in  England  for  a  clerk  to  insure  the 
life  of  his  master.  If  the  clerk  has  a  contract  for  service 
for  a  number  of  years  at  an  annual  salary,  he  has  nn  insur- 
able interest  in  the  life  of  his  employers  to  the  amount 
which  will  be  payable  to  him  for  the  unexpired  portion  of 
his  term,  provided  he  continue  in  the  service. ^     So  a  master 

1  Per  Woodruff,  J.,  Miller  v.  Eagle  Life  &  Health  Ins.  Co.,  2  E.  D'.  Smith 
(N.  Y.  C.  P.),  268. 

'^  Hehdon  v.  West,  3  Best  &  Smith,  578.  This  case  was  that  of  a  clerk  who, 
standing  in  the  relation  of  a  debtor  to  his  employer,  his  employer  having  prom- 
ised that  while  he  lived  the  clerk  should  not  be  called  upon  to  pay,  took  out  a 

197 


§110]         insurance:  fire,  life,  accident,  etc.        [ch.  vi. 

has  an  insurable  interest  in  the  life  of  a  servant,  to  whose 
services  he  has  a  legal  claim.  ^ 

§  110.  Interest  of  Assignee.  — The  general  rule  recognized 
by  the  courts  is,  that  no  one  can  have  an  insurance  upon  the 
life  of  another  unless  he  has  an  interest  in  the  continuance 
of  the  life,  (a)  To  hold  otherwise  would  be  contrary  to  the 
general  policy  of  the  law  respecting  insurance,  in  that  it 
may  lead  to  gambling  or  speculating  contracts  upon  the 
chances  of  human  life.  And  although  when  the  contract 
between  the  insured  and  the  insurers  is  expressed  to  be  for 
the  benefit  of  another, ^  or  is  made  payable  to  another  than 
the  representative  of  the  insured,^  or  when  an  assignment  to 
such  other  person  is  assented  to  by  the  insurers,  the  contract 
may  be  sustained ;  yet,  if  the  assignee  has  no  interest  in  the 
life  of  the  subject  of  the  insurance  which  would  sustain  a 
policy  to  himself,  the  assignment  would  only  take  effect  as 
a  designation,  by  mutual  agreement  of  the  contracting  par- 
ties, of  the  person  who  should  be  entitled  to  receive  the  pro- 
ceeds, when  due,  instead  of  the  personal  representatives  of 
the  insured.  And  if  it  should  appear  that  the  arrangement 
was  a  cover  for  a  speculating  risk,  contravening  the  general 
policy  of  the  law,  it  would  not  be  sustained.  The  purpose  of 
the  clause  in  the  policy,  forbidding  assignments  without  the 

policy  of  insurance  on  the  life  of  the  creditor  to  the  amount  of  the  debt.  But  the 
court  said  that  this  interest  in  the  life  of  the  creditor  was  only  an  expectation  that 
he  would  not  call  for  the  debt.  It  was  a  possibility  of  forbearance,  an  attempt  to 
embrace  the  chance  that  the  creditor  would  not  do  what  he  might  do  the  day  after 
the  engagement  was  made,  presenting  a  contingency  not  easily  susceptible  of 
pecuniary  estimation,  and  they  did  not  think  that  such  a  promise,  without  any 
consideration,  or  any  circumstances  to  make  it  in  any  way  binding,  could  be  con- 
sidered a  pecuniary,  or  even  an  appreciable,  interest. 

1  Miller  v.  Eagle  Life  &  Health  Ins.  Co.,  2  E.  D.  Smith  (N,  Y.  C.  P.),  268. 

2  See  §  112. 

{a)  An  assignee  of  a  policy,  who  has  mercial  Building  Ass'n,  97  Va.  74.  In 
no  insurable  interest  in  the  insured's  New  York,  an  insurable  interest  in  the 
life,  can  only  retain  so  much  of  the  payee  is  necessary,  in  the  first  instance, 
proceeds,  where  the  insurance  was  law-  to  the  validity  of  the  contract,  but  such 
fully  effected,  as  is  necessary  to  reim-  interest  need  not  continue,  as  in  the 
burse  him  for  premiums  paid,  expenses  case  of  a  wife  divorced  frpm  her  bus- 
incurred,  and  interest  thereon.  Beaty  band  ;  and  the  assignee  of  a  valid  policy 
V.  Downing,  96  Va.  451  ;  New  York  L.  may  recover  its  full  value.  Steinback 
Ins.  Co.  V.  Davis,  id.  737  ;  Tate  r.  Com-  v.  Diepenbrock,  158  N.  Y.  24. 

198 


CH.  VI.]  SUBJECT-MATTER.  —  INSURABLE   INTEREST.         [§111 

assent  of  the  company,  in  concurrence  with  the  policy  of  the 
law,  is  undoubtedly  to  guard  against  the  increased  risks  of 
speculating  insurance.  The  insurers  are  entitled  to  the  full 
benefit  of  such  a  provision,  as  a  matter  of  contract ;  and,  as 
the  policy  of  the  law  accords  with  its  purpose,  the  court 
will  not  regard  with  favor  any  rights  sought  to  be  acquired 
in  contravention  of  the  provision.^ 

§  111.  Trustee.  — A  peculiar  case,  involving  the  question 
of  what  constitutes  an  insurable  interest,  arose  under  the 
following   circumstances:   A.,    upon   his   marriage,    gave   a 

1  Stevens,  Adm'r,  v.  "Warren,  Adm'r,  101  Mass.  564,  566.  The  question  in 
this  case  was  whether  the  assignee  of  a  policj',  a  stranger  without  interest,  not- 
withstanding assignment  without  the  consent  of  the  insurer,  had  any  interest  in 
the  proceeds  ;  and  it  was  held  that  he  had  not,  both  upon  the  ground  of  the  pro- 
hibition and  upon  the  ground  that  such  a  transaction  would  be  against  public 
policy,  as  a  mere  speculation.  But  see  Swick  v.  Home  Ins.  Co.,  2  Dillon,  C.  Ct. 
(U.  S.)  160,  and  post,  §§  112,  398.  [Any  one  may  insure  his  own  life  and  assign 
the  policy  to  whom  he  will  if  the  transaction  is  not  a  mere  cover  for  a  wager. 
Langdon  v.  Union  Mut.  Life  Ins.  Co.,  14  Fed.  Rep.  272  ;  12  Ins.  L.J.  548  Mich. 
(1882)  ;  Mtua.  Life  Ins.  Co.  v.  France,  94  U.  S.  561  ;  Conn.  Mut.  Life  Ins.  Co.  v. 
Schaefer,  94  U.  S.  457  (1876).  A  person  has  an  insurable  interest  in  his  own 
life,  and  no  use  he  may  afterward  make  of  the  policy  can  convert  it  into  a  wager 
policy.  Valton  v.  Nat.  Loan  Fund  L.  Ass.  Soc,  22  Barb.  9.  But  if  one  having 
an  insurable  interest  takes  out  a  policy /or  the  purpose  of  assigning  it  to  one  with- 
out interest,  and  the  purpose  is  effected,  the  policy  is  a  wager  in  the  hands  of  the 
assignees.  Keystone  Mut.  Ben.  Ass.  v.  Norris,  115  Pa.  St.  446.  It  was  held  in  a 
Canada  Court  that  if  the  applicant  is  unable  to  pay  the  premium,  and  a  stranger 
steps  up  and  pays  it  and  takes  an  assignment  of  the  life  policy,  prepared  in  the 
name  of  the  applicant,  the  contract  is  void  in  his  hands.  Vezina  v.  N.  Y.  Life 
Ins.  Co.,  25  L.  C.  Jur.  232.  But  the  Supreme  Court  reversed  this,  and  held  that 
if  G.  applies  for  insurance  honnjide,  and  because  he  is  unable  to  pay  the  premium 
L.  pays  it,  and  the  policy  is  assigned  to  him,  the  payment  relates  back  to  the 
inception  of  the  contract,  the  date  of  the  policy,  and  there  being  no  collusion 
between  G.  &  L.  the  conti-act  is  not  a  wagering  one.  Vezina  v.  N.  Y.  Life  Ins. 
Co.,  6  Can.  Supr.  Ct.  30,  Gwynne,  J.,  dissenting.  Contra,  it  has  been  held  that 
one  without  insurable  interest  can  acquire  no  title  by  assignment  or  otherwise  to 
the  sum  payable  on  the  death  of  tlie  insured,  and  if  the  company  pay  it  to  such  a 
person,  the  administrator  of  the  insured  may  recover  it  from  him  less  the  assess- 
ments paid  by  him.  Gilbert  v.  Moose,  104  Pa.  St.  74.  A  policy  on  the  life  of 
one  in  which  the  insured  has  no  interest,  is  void,  and  if  a  policy  taken  out  bj'  one 
on  his  own  life  is  assigned  to  one  without  insurable  interest,  the  case  comes  within 
the  reason  of  the  rule,  and  the  policy  is  valid  in  the  hands  of  the  assignee  only  to 
the  extent  of  his  insurable  interest.  Helmetag's  Adm'r  v.  Miller,  76  Ala.  183, 
186.  An  assignment  to  one  without  interest  can  put  him  in  no  better  position 
than  he  could  be  by  taking  out  an  original  policy.  The  assignee  will  not  be  pro- 
tected beyond  the  extent  of  his  insurable  interest.  Warnock  v.  Davis,  104  U.  S. 
775.] 

199 


§  112]  INSURANCE  :    FIRE,    LIFE,    ACCIDENT,   ETC.  [CII.  VI. 

bond  to  secure  X5,000  to  his  intended  wife.  Several  years 
after  the  marriage,  A.  being  in  difficulties  and  unable  to 
perform  his  bond,  it  was  arranged  that  his  wife  should,  out 
of  her  private  income,  keep  up  certain  policies  to  be  effected 
on  A.'s  life,  in  which  he  was  to  have  no  further  interest 
than  to  carry  out  his  bond.  In  pursuance  of  this  arrange- 
ment A.  insured  his  life  by  a  policy,  one  of  the  conditions 
of  which  provided  that  policies  effected  by  persons  on  their 
own  lives,  who  should  die  by  their  own  hands,  should  be 
void  so  far  as  regards  the  executors  or  administrators  of  the 
person  so  dying,  but  should  remain  in  force  only  to  the  ex- 
tent of  any  bona  fide  interest  acquired  by  any  other  person 
under  an  actual  assignment  by  deed  for  a  valuable  consider- 
ation in  money,  or  by  virtue  of  any  legal  or  equitable  lien  as 
a  security  for  money,  upon  proof  of  the  extent  of  such  inter- 
est being  given  to  the  directors  to  their  satisfaction.  The 
policy,  together  with  the  bond  for  £5,000,  was,  immediately 
on  its  being  effected,  handed  over  to  T.,  as  a  trustee  for  A.'s 
wife,  in  whose  hands  they  always  remained.  A.  's  wife  paid 
the  premiums  upon  the  policy  in  pursuance  of  the  arrange- 
ment. A.  died  by  his  own  hands,  and  a  claim  was  made 
upon  the  insurance  office  by  his  executors  for  the  amount  of 
the  policy,  which  was  resisted.  But  it  was  held  that  T.  had 
a  bona  fide  interest  in  the  policy  by  virtue  of  an  equitable 
lien  as  a  security  for  money  within  the  meaning  of  the  con- 
dition, and  that  the  executors  of  A.  were  therefore  entitled 
to  recover.^  (a) 

§  112.    Interest  of  Payee  or  Beneficiary.  —  Whether,  where 

1  Moore  v.  ^yoolaey,  28  Eng.  L.  &  Eq.  248.  "  Proof  ...  to  their  satisfac- 
tion "  was  held  to  be  such  proof  as  they  ought  to  be  satisfied  with. 

(a)  See  Cross  v.  National  F.  Ins.  Co.,  Brown  v.  Cotton  &  Woolen  Manuf.  Ins. 
132  N.  Y.  133.  An  assignee  for  creditors  Co.,  156  Mass.  587  ;  see  Weed  v.  Ham- 
may  insure  the  property  held  by  him  burg-Bremen  F.  Ins.  Co.,  133  N.  Y. 
under  the  assignment.  Sibley  v.  Pres-  394.  A  judgment  creditor,  whose  at- 
cott  Ins.  Co.,  54  Mich.  14.  A  creditor  tachment  has  been  followed  by  the  levy 
has  an  insurable  interest  in  the  estate  of  execution,  begun  but  not  completed, 
of  his  debtor  when  conveyed  to  an  may  insure  the  attached  property  and 
assignee  in  insolvency,  but  his  interest  collect  on  the  policy  without  accounting 
is  not  a  continuation  of  his  former  in-  to  the  debtor.  International  Trust  Ca 
terest  as  owner  of  the  insured  property,  v.  Boardman,  149  Mass.  158. 

200 


CH.  VI.]  SUBJECT-MATTER. — INSURABLE   INTEREST.  [§100 


a  party  effects  an  insurance  on  his  own  life,  for  the  benefit 
of  another  who  pays  the  premiums,  the  policy  is  a  valid  one 
has  been  doubted,  but  the  weight  of  authority  seems  to  be  in 
favor  of  the  validity;  it  being  in  substance  a  contract  with 
the  beneficiary,  who  is  the  "  assured. "  ^  (a)     If  the  person 

1  Wainewright  v.  Bland,  1  Moo.  &  Rob.  481  ;  s.  c.  1  Jlees.  &  Wels.  32  ;  Val- 
ton  V.  National  Loan  Fund  Life  Assurance  Soc,  22  Barb.  (N.  Y.)  9  ;  s.  c.  on 
appeal,  20  N.  Y.  32  ;  Rawls  v.  Amer.  Mat.  Life  Ins.  Co.,  27  N.  Y.  282.  [If  the 
policy  on  its  face  runs  to  the  "  life  "  though  payable  to  another  who  was  active 
in  the  procurement  of  it,  it  will  be  presumed  after  verdict  that  it  did  constitute  an 
insurance  taken  out  by  the  "  life  "  for  the  benefit  of  the  other,  and  will  not  be 
invalid  as  a  wager.     Fairchild  v.  North  Eastern  Mut.  Life  Ass.,  51  Vt.  613.] 


(a)  Every  person  has  an  insurable 
interest  in  his  own  life  to  an  unlimited 
extent  ;  and  he  may  insure  it  for  the 
benefit  either  of  his  personal  representa- 
tives or  of  a  third  person.  Nye  v. 
Grand  Lodge,  9  Ind.  App.  131,  143  ; 
Stuart  V.  Sutcliffe,  46  La.  An.  240  ; 
Hurd  V.  Doty,  86  Wis.  1  ;  see  35  Am. 
L.  Reg.  N.  s.  65.  In  Wisconsin,  such 
an  assured  may  change  the  beneficiary 
named.  Breitung's  Estate,  78  Wis.  33. 
In  general,  the  beneficiary  named  in  a 
life  policy  need  not  have  an  insurable 
interest.  Robinson  v.  U.  S.  Mut.  Ace. 
Ass'n,  68  Fed.  Rep.  825  ;  American 
Employers'  L.  Ins.  Co.  v.  Barr,  id.  873  ; 
Donnell  v.  Donnell,  86  Maine,  518. 
The  weight  of  authority  now  seems 
clearly  to  be  that  the  taking  out  of  a 
policy  on  one's  own  life  for  the  benefit 
of  another,  who  has  no  insurable  interest 
therein,  the  former  paying  the  premium, 
so  far  differs  from  an  assignment  that 
the  beneficiary  in  the  former  case  may 
recover  on  the  policy,  when  the  transac- 
tion is  not  a  mere  cloak  for  a  wager. 
See  Heinlein  v.  Imperial  L.  Ins.  Co., 
101  Mich.  250  ;  25  L.  R.  Ann.  627, 
and  note  ;  Souder  v.  Home  Friendly 
Society,  72  Md.  511 ;  Steinback  v. 
Diepenbrock,  158  N.  Y,  24  ;  Albert  v. 
Mutual  L.  Ins.  Co.,  122  N.  C.  92  ;  Ken- 
tucky Life  &  Ace.  Ins.  Co.  v.  Hamilton, 
63  Fed.  Rep.  93;  Prudential  Ins.  Co. 
V.  Hunn,  21  Ind.  App.  525  ;  Same  v. 
Liersh  (Mich.),  29  Ins.  L.  J.  470.  The 
fact  that  such  beneficiary's  claims  are 


not  yet  fully  due  is  not  material  as  to 
the  insurer.  Hale  v.  Life  Indemnity 
Co.,  65  Minn.  548.  An  assignment  to 
one  having  no  insurable  interest,  which 
is  merely  a  colorable  evasion  of  the  law 
against  wagers,  cannot  be  enforced. 
Clement  v.  New  York  L.  Ins.  Co. 
(Teun.),  42  L.  R.  A.  247,  and  note.  It  is 
against  public  policy  for  one  to  procure 
insurance  on  another's  life  without  his 
knowledge  and  consent ;  and  even  if  a 
wife  procures  insurance  on  her  husband's 
life  without  his  knowledge  or  consent, 
paying  his  money  therefor,  he  is  entitled 
to  recover  it  back  from  the  insurer. 
Met'n  L.  Ins.  Co.  v.  Monahon  (Ky.), 
42  S.  W.  924  ;  Met'n  L.  Ins.  Co.  v. 
Trende  (Ky.),  53  id.  412.  In  Pennsyl- 
vania it  is  held  that  an  absolute  assign- 
ment, and  surrender  of  control  over  the 
policy,  to  one  having  no  interest  in  the 
insured's  life,  makes  the  policy  void  in 
the  assignee's  hands  ;  but  that  insur- 
ance taken  out  by  an  elderly  person 
and  assigned  by  him  to  a  poor  child 
whom  he  befriends  and  educates,  gives 
the  child  an  insurable  interest  in  his 
life.  Gilbert  v.  Moose,  104  Penn.  St. 
74  ;  Vanormer  v.  Hornberger,  142  id. 
575  ;  Burke  v.  Prudential  Ins.  Co.,  155 
Penn.  St.  295  ;  McHale  v.  McDonnell, 
175  id.  632  ;  Carpenter  v.  U.  S.  L.  In.s. 
Co.,  161  id.  9.  In  North  Carolina, 
where  a  church  member,  on  whom  the 
church  in  part  depended  for  support, 
but  without  any  contract  on  his  part 
therefor,   applied  for  insurance  on  his 

201 


§113]  insurance:    fire,   life,   accident,   etc.  [CH.  VI. 

whose  life  is  insured  pays  the  premiums,  there  can  be  no 
doubt,  even  if  the  beneficiary  has  no  interest,  since  his  own 
interest  supports  the  policy.  ^  In  Forbes  v.  American  Mut- 
ual Life  Insurance  Company,^  the  insured  took  out  a  policy 
upon  his  own  life  payable  to  his  sister's  husband,  paying  the 
first  premium  himself,  and  the  subsequent  ones  through  the 
husband  as  his  agent.  The  policy  stipulated  that  "policies 
made  payable  to  creditors  or  persons  not  belonging  to  the 
family  of  the  person  whose  life  is  insured  are  subject  to 
proof  of  interest."  The  court  were  inclined  to  the  opinion 
that  even  under  these  conditions  the  plaintiff  would  be  en- 
titled to  recover,  though  the  point  was  not  decided,  since  it 
was  not  raised  by  the  pleadings.  It  was  only  held  that 
there  was  an  interest  to  support  the  policy.^ 

§  113.  Beneficiary's  Name  must  appear. — So  in  England, 
under  statute  14  Geo.  III.  c.  48,  the  name  of  the  beneficiary 
must  appear  in  the  policy,  as  affirmed  by  the  following  case : 
The  plaintiff  married  a  wife  who  was  a  minor,  and  who  was 
entitled  to  a  legacy  on  ai-riving  at  her  majority.  The  plain- 
tiff asked  the  trustees  to  advance  money  in  anticipation,  to 
which  they  consented  if  A.  would  become  surety.  This  A. 
consented  to  do  if  the  plaintiff  would  insure  his  wife's  life. 

1  Campbell  v.  N.  E.  Mut.  Life  Ins.  Co.,  98  Mass.  381  ;  Hogle  v.  Guardian 
Life  Ins.  Co.,  6  Robt.  (Superior  Ct.  N.  Y.)  567.  The  case  of  Holabird  v.  Atlan- 
tic Mut.  Life  Ins.  Co.,  2  Dillon,  C.  Ct.  (U.  S.)  166,  is  apparently  to  the  contrar)'. 
[A  man  may  insure  his  own  life,  himself  paying  the  premiums  for  the  benefit  of 
another,  who  has  no  insurable  interest.  Scott  v.  Dickson,  108  Pa.  St.  6.  A  son 
may  insure  for  the  benefit  of  his  father.  Tucker  v.  Mut.  Ben.  Life  Co.,  50 
Hun,  54.] 

2  15  Gray  (Mass.),  249. 
8  See  ante,  §  110. 

life  for  its  benefit,  and,  the  policy  being  Ins.  Co.  v.  Blodgett,  8  Tex.    Civ.  App. 

issued   to   the   church,    the    premiums  812.     A  general  creditor,  having  no  in- 

were  paid  by  hiin,  it  was  held  that  the  surable  interest  in  any  specific  property 

church  had  no  insurable  interest  in  his  of  his  debtor,  cannot  insure  it,  but  the 

life,  and  that  the  policy  was  void  as  a  debtor  may  with  the  insurer's  consent, 

wager.      Trinity   College   v.   Travelers'  for  the  creditor's  benefit,  so   far  as  the 

Ins.  Co.,  113  N.  C.  244.     A  beneficiary  latter's  interest   may  appear,  as,  e.  g., 

who  is  named  by  the  insured,  but  is  when   security   is   thus    given    for   ad- 

without  insurable  interest,  becomes,  if  vances.     Gniterman  v.  German-Ameii- 

he  pays  the  premium,  a  trustee  for  the  can  Ins.  Co.,  Ill  Mich.  626. 
parties  letjally  entitled.      Mutual  Life 

202 


CH.  VI.]  SUBJECT-MATTER. — INSURABLE   INTEREST.  [§115 

At  plaintiff's  suggestion  the  wife  insured  her  life  in  her  own 
name,  without  mention  that  any  one  else  had  an  interest  in 
the  policy.  This  was  lield  void  under  the  statute  14  Geo. 
III.  c.  48,  which  requires  the  name  of  the  person  interested 
in  the  policy,  or  for  whose  use  or  benefit,  or  on  whose  ac- 
count the  policy  is  taken  out,  as  the  purpose  of  the  policy 
was  to  protect  the  surety.  Although  the  wif«  might  have  an 
ultimate  interest,  the  interest  of  the  surety  at  the  time  of 
the  insurance  Avas  clear,  and  it  should  have  been  so  stated. 
And  so  also  should  the  husband's  name  have  appeared  as  a 
beneficiary.^ 

§  114.  Life  Policy  generally  a  Valued  Policy.  —  A  life  pol- 
icy is  almost  always  a  valued  policy, ^  but  not  necessarily  so. 
Thus,  Bruce  v.  Garden  ^  was  the  case  of  an  insurance  by  a 
creditor  who  had  a  running  and  constantly  varying  account 
with  his  debtor,  to  secure  himself  against  loss  of  the  balance 
which  might  at  any  time  be  due  him.  Of  course  in  such  a 
case  the  measure  of  damages  is  the  amount  which  may  be 
found  to  be  due  at  the  death  of  the  debtor,  a  loss  which  is 
to  be  determined  by  proof  as  in  other  cases  of  open  policies. 
There  were  several  policies  in  this  case  amounting  to  much 
more  than  the  offices  paid.  What  was  paid  was  the  actual 
amount  of  the  balance  found  due  at  the  time  of  the  decease. 

§  115.  Interest  in  the  Life  need  not  continue  till  Death ; 
English  Cases.  —  We  have  said  that  the  general  doctrine 
was,  that  in  life  as  well  as  in  fire  and  marine  insurance 
there  must  be  an  interest  at  the  time  of  the  loss  as  well  as 
at  the  time  of  insurance  in  order  to  support  the  policy.^ 
This  subject  has  received  a  very  careful  consideration  in 
the.  Exchequer  Chamber,  resulting  in  the  conclusion  that  the 
doctrine  for  which  Godsall  w.  Boldero°has  been  constantly 
referred  to  as  an  authority  —  that  there  must  be  an  insur- 

1  Evans,  Adm'r,  v.  Bignold,  20  L.  T.  E.  n.  s.  659. 

2  St.  John  V.  Amer.  Mut.  Life  Ins.  Co.,  2  Duer  (N.  Y.  Superior  Ct.),  419. 
[A  life  policy,  unlike  fire  and  marine  insurance,  is  not  a  contract  of  indemnity, 
but  an  agreement  to  pay  a  specific  sum.     Scott  v.  Dickson,  108  Pa.  St.  6.] 

3  20  L.  T.  R.  N.  s.  1002  ;  s.  c.  on  appeal  to  the  Lord  Chancellor,  22  id.  59.5. 
*  Ante,  §  29. 

6  9  East,  72. 

203 


§  115]         insurance:  fire,  life,  accident,  etc.         [ch.  vi. 

able  interest  in  the  holder  of  the  policy  at  the  time  of  the 
loss  as  well  as  at  the  time  of  effecting  the  insurance  —  is 
not  sound  law,  as  applicable  to  life  policies.  ^  The  question 
in  this  case,  it  being  admitted  that  the  plaintiff  had  no  in- 
terest at  the  time  of  the  death,  was  upon  the  construction  of 
the  statute  14  Geo.  III.  c.  48 ;  as,  independently  of  the  stat- 
ute, there  could  be  no  doubt  that  a  life  policy,  without  any 
interest  to  support  it,  was  a  perfectly  legal  contract. ^  And 
so  it  is  to  this  day  in  Ireland,  where  the  statute  14  Geo.  III. 
c.  48,  has  remained  in  force. ^ 


1  Dalby  v.  India  &  London  Life  Ass.  Co.,  15  C.  B.  365. 

2  Cousins  V.  Nautes,  3  Taunt.  513  ;  Lucena  v.  Craufurd,  2  Bos.  &  Pul.  N.  E. 
269. 

8  British  Ins.  Co.  v.  Magee,  Cooke  &  Alcock,  182.  "  This  contract,"  said  the 
court,  ])er  Parke,  B.,  after  holding  the  case  under  advisement,  "  is  good  at  com- 
mon law,  and  certainly  not  avoided  by  the  first  section  of  the  14  Geo.  III.  c.  48. 
This  section,  it  is  to  be  observed,  does  not  provide  for  any  particular  amount  of 
interest.  According  to  it,  if  there  was  any  interest,  however  small,  the  policy 
would  not  be  avoided.  The  question  arises  on  the  third  clause.  It  is  as  follows  : 
•  And  be  it  further  enacted,  that,  in  all  cases  where  the  insured  hath  interest  in 
the  life  or  lives,  event  or  events,  no  greater  sum  shall  be  recovered  or  received 
from  the  insurer  or  insurers,  than  the  amount  or  value  of  the  interest  of  the 
assured  in  such  life  or  lives,  or  other  event  or  events.'  Now  what  is  the  meaning 
of  this  provision  ?  On  the  part  of  the  plaintiff  it  is  said  it  means  only  that,  iu 
all  cases  in  which  the  party  insuring  has  an  interest  when  he  effects  the  policy, 
his  right  to  recover  and  receive  is  to  be  limited  to  that  amount  ;  otherwise,  under 
color  of  a  small  interest,  a  wagering  policy  might  be  made  to  a  large  amount,  — 
as  it  might  if  the  first  clause  stood  alone.  The  right  to  recover,  therefore,  is 
limited  to  the  amount  of  the  interest  at  the  time  of  effecting  the  policy.  Upon 
that  value,  the  assured  must  have  the  amount  of  premium  calculated ;  if  he 
states  it  truly,  no  difficulty  can  occur  ;  he  pays  in  the  annuity  for  life  the  fair 
value  of  the  sum  payable  at  death.  If  he  misrepresents,  by  overstating  the  value 
of  the  interest,  it  is  his  own  fault  in  paying  more  in  the  way  of  annuity  than  he 
ought  ;  and  he  can  recover  only  the  true  value  of  the  interest  in  respect  of  which 
he  effected  the  policy ;  but  that  value  he  can  recover.  Thus,  the  liability  of  the 
assurer  becomes  constant  and  uniform,  to  pay  an  unvarying  sum  on  the  death  of 
the  cestui  que  vie,  in  consideration  of  an  unvarying  and  uniform  premium  paid  by 
the  assured.     The  bargain  is  fixed,  as  to  the  amount,  on  both  sides. 

"This  construction  is  effected  by  reading  the  word  '  hath,'  as  referring  to  the 
time  of  effecting  the  policy.  By  the  first  section  the  assured  is  prohibited  from 
effecting  an  insurance  on  a  life  or  on  an  event  wherein  he  '  shall  have  '  no  inter- 
est; that  is,  at  the  time  of  assuring.  And  then  the  third  section  requires  that 
he  .shall  cover  only  the  interest  that  he  'hath.'  If  he  has  an  interest  when  the 
policy  is  made,  he  is  not  wagering  or  gaming,  and  the  prohibition  of  the  statute 
does  not  apply  to  his  case.  Had  the  third  section  provided  that  no  more  than 
the  amount  or  value  of  the  interest  should  be  insured,  a  question  might  have 
been  raised,  whether,  if  the  insurance  had  been  for  a  larger  amount,  the  whole 

204 


CH.  VI.]  SUBJECT-MATTER.  —  INSVEABLE  INTEREST.  [§116 

§  116.  The  injustice  of  the  decision  in  Godsall  v,  Bolderoi 
was  so  manifest,  that  it  is  not  to  be  wondered  at  that  the 

would  not  have  been  void  ;  but  the  prohibition  to  recover  or  receive  more  than 
that  amount  obviates  any  difficulty  on  that  head. 

"  On  the  other  hand,  the  defendants  contend  that  the  meaning  of  this  claim  is, 
that  the  assured  shall  recover  no  more  than  the  value  of  the  interest  which  he 
has  at  the  time  of  the  recovery,  or  receive  more  than  its  value  at  the  time  of  the 
receipt. 

"  The  words  must  be  altered  materially,  to  limit  the  sum  to  be  recovered  to 
the  value  at  the  time  of  the  death,  or  (if  payable  at  a  time  after  death)  when  the 
cause  of  action  accrues.  But  there  is  the  most  serious  objection  to  any  of  these 
constructions.  It  is,  that  the  written  contract,  which,  for  the  reasons  given  be- 
fore, is  not  a  wagering  contract,  but  a  valid  one,  permitted  by  the  statute,  and 
very  clear  in  its  language,  is  by  this  mode  of  construction  completely  altered  in 
its  terms  and  effect.  It  is  no  longer  a  contract  to  pay  a  certain  sum  as  the  value 
of  the  then  existing  interest,  in  the  event  of  death,  in  consideration  of  a  fixed 
annuity  calculated  with  reference  to  that  sum  ;  but  a  contract  to  pay  —  contrary 
to  its  express  words  —  a  varying  sum,  according  to  the  alteration  of  the  value  of 
that  interest  at  the  time  of  the  death,  or  the  accrual  of  the  cause  of  action,  or  the 
terms  of  the  verdict  or  execution  ;  and  yet  the  price  or  the  premium  to  be  paid 
is  fixed,  calculated  on  the  original  fixed  value,  and  is  unvarying ;  so  that  the 
assured  is  obliged  to  pay  a  certain  premium  every  year,  calculated  on  the  value 
of  his  interest  at  the  time  of  the  policy,  in  order  to  have  a  right  to  recover  an 
uncertain  sum  ;  viz.,  that  which  happens  to  be  the  value  of  the  interest  at  the 
time  of  the  death,  or  afterwards,  or  at  the  time  of  the  verdict.  He  has  not  there- 
fore a  sum  certain  which  he  stipulated  for  and  bought  with  a  certain  annuity  ; 
but  it  may  be  a  much  less  sum,  or  even  none  at  all. 

"  This  seems  to  us  so  contrary  to  justice  and  fair  dealing  and  common  honesty, 
that  this  construction  cannot,  we  think,  be  put  upon  this  section.  We  should 
therefore  have  no  hesitation  if  the  question  were  res  integra,  in  putting  the  much 
more  reasonable  construction  on  the  statute,  that  if  there  is  an  .interest  at  the 
time  of  the  policy  it  is  not  a  wagering  policy,  and  that  the  true  value  of  that 
interest  may  be  recovered  in  exact  conformity  with  the  words  of  the  contract  itself. 

"  The  only  efi'ect  of  the  statute  is  to  make  the  assured  value  his  interest  at  its 
true  amount  when  he  makes  the  contract." 

The  court  then  proceed  to  say  that  Godsall  v.  Boldero  was  founded  upon  a 
mistaken  analogy,  the  language  of  Lord  Mansfield  in  Hamilton  v.  Mendes,  2  Burr. 
1198,  upon  which  Lord  Ellenborough  relied,  having  reference  to  a  marine  policy 
which  is  in  its  terms  a  contract  of  indemnity  only;  that  while  it  had  been 
referred  to  in  divers  cases  without  calling  it  in  question,  and  sometimes  with 
approbation  ( Fide  Barber  v.  Morris,  1  Moody  &  R.  62 ;  Humphrey  v.  Arabin, 
2  Lloyd  &  G.  Ch.  318  ;  Henson  v.  Blackwell,  4  Hare,  434,  cor.  Sir  J.  \\'igram, 
V.  C.  ;  Phillips  v.  Eastwood,  1  Lloyd  &  G.  Ch.  (Cas.  temp.  Sugden,  290)  321),  yet 
in  none  of  these  cases  was  it  material  to  controvert  the  point  in  question  ;  that  in 
point  of  fact,  in  practice,  it  had  been  uniformly  disregarded  ;  and  that  therefore 
they  ought  not  to  be  bound  by  the  authority  of  that  case.  The  law  is  otherwise 
in  this  country.  See  Ruse  v.  Mut.  Benefit  Life  Ins.  Co.,  23  N.  Y.  (9  Smith)  516. 
As  this  statute  is  frequeutly  referred  to  in  the  reports,  it  may  be  convenient  to 

1  9  East,  72. 

205 


§116]  insurance:    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  VI 

insurance  companies  refused  to  avail  themselves  of  its  prof- 
fered shelter,  and  that  it  became  practically  a  dead  letter. 
But  the  error  was  not  that  it  proceeded  on  a  mistaken  anal- 
ogy, and  treated  the  contract  under  consideration,  like  con- 
tracts in  marine  and  fire  insurance,  as  a  contract  of  indem- 
nity, but  rather  in  a  mistaken  application  of  the  principle. 
The  court  erroneously  assumed  that  if  the  debt  which  consti 
tuted  the  insurable  interest  was  paid  after  the  death  of  the 
debtor  and  before  action  brought,  the  creditor  was  indemni- 
fied.  He  was  indeed  paid  so  far  as  the  original  debt  was 
concerned;  but  he  was  not  at  all  indemnified  so  far  as  the 

have  it  in  full.  It  is  accordingly  here  subjoined.  Statute  14  Geo.  III.  c.  48, 
enacts  :  — 

First,  "  That  no  insurance  shall  be  made  by  any  person  or  persons,  bodies 
politic  or  corporate,  on  the  life  or  lives  of  any  person  or  persons  or  on  any 
other  event  or  events  whatever,  wherein  the  person  or  persons,  for  whose  use  or 
benefit  or  on  whose  account  such  policy  or  policies  shall  be  made,  shall  have  no 
interest,  or  by  way  of  gaming  or  wagering  ;  and  that  every  insurance  made  con- 
trary to  the  true  intent  and  meaning  of  this  act  shall  be  null  and  void  to  all 
intents  and  purposes  whatsoever." 

Second,  "  That  it  shall  not  be  lawful  to  make  any  policy  or  policies  on  the 
life  or  lives  of  any  person  or  persons,  or  other  event  or  events,  M'ithout  inserting 
in  such  policy  or  policies  the  name  or  names  of  the  person  or  persons  interested 
therein,  or  for  what  use,  benefit,  or  on  whose  account  such  policy  is  so  made  or 
underwrote." 

Third,  "  That  in  all  cases  where  the  insured  hath  an  interest  in  such  life  or 
lives,  event  or  events,  no  greater  sum  shall  be  recovered  or  received  from  the 
insurer  or  insurers,  than  the  amount  or  value  of  the  interest  of  the  insured  in 
such  life  or  lives,  or  other  event  or  events." 

The  fourth  section  contains  a  proviso  that  this  act  shall  not  extend  to  insur- 
ances bona  fide  made  on  ships  or  goods. 

Professor  De  Morgan  also  (Essay  on  Probabilities,  p.  244  et  seq.  ;  and  see  note 
appended  to  the  case  of  Dalby  v.  India  &  London  Life  Assurance  Co.,  lit  sup.) 
criticises  the  doctrine  of  Godsall  v.  Boldero  with  much  force  and  piquancy, 
observing  amongst  other  things  that  "the  several  principles  on  which  the  deci- 
sion was  founded,  well  carried  out,  as  they  say  in  Parliament,  would  require  that 
tlie  previous  contracts  of  a  man  who  becomes  insane  should  be  null  and  void  ; 
that  the  meat  which  a  man  buys  for  his  dinner  should  be  returnable  to  his  butcher 
under  the  cost,  if  his  friend  should  invite  him  in  the  mean  time  ;  and  in  the  case 
before  us,  supposing  that  C.  (the  creditor)  should  have  outlived  the  term,  and  his 
debt  were  paid  as  before,  then  B.  (the  assured)  might  have  brought  his  action 
against  the  office  for  the  return  of  the  premiums  ;  alleging  that,  as  it  turned  out, 
the  office  would  have  been  indemnified,  and  thei'efore  should  have  been  considered 
as  having  run  no  risk."  See  also  Law  v.  Indisputable  Life  Policy  Co.,  1  Jurist, 
N.  s.  178,  where  Wood,  V.  C,  accepts  and  applies  the  doctrine  of  Dalby  v.  India 
&  London  Life  Assurance  Co.  ;  Whiting  v.  Sun  Mut.  Ins.  Co.,  15  Md.  297,  326  ; 
McKenty  v.  Universal  Life  Ins.  Co.,  C.  Ct.  (Minn.),  6  Ch.  Legal  News,  199. 

206 


--^  i>   lU  \U,jLJu  V 


CH.  VI.]  SUBJECT-MATTER.  —  INSURABLE   INTEREST.         [§116 

new  debt  contracted  by  the  insurers  to  the  insured  was  con- 
cerned. In  contemplation  of  law,  and  by  the  understanding 
of  the  parties,  the  annual  payments  which  the  insured  agreed 
to  make  were  the  equivalent,  and  a  profit  beside,  of  the  total 
sum  which  the  insurers  agreed  to  pay  at  the  death  of  the 
debtor.  So  that,  although  subsequently  to  that  time,  and 
before  suit  brought,  the  original  debt  was  paid  by  the 
debtor's  executor,  yet,  as  the  creditor  had,  in  contemplation 
of  law,  and  according  to  the  understanding  of  the  parties, 
and  possibly  in  point  of  fact,  in  the  mean  time  paid  to  the 
insurers  sums  of  money  which  in  the  aggregate  amounted  to 
a  sum  equal  to  that  which  he  received  from  the  debtor,  he 
would  suffer  a  total  loss  unless  the  insurers  should  pay  him 
the  amount  of  the  policy.  In  fact,  upon  the  doctrine  of  in- 
demnity merely,  correctly  applied,  the  insurers  should  have 
been  held  to  pay.  The  effect  of  the  decision  was,  moreover, 
to  make  a  new  contract ;  to  wit,  that  the  insurers  would  pay 
the  insured  the  amount  of  the  debt,  if  some  one  else  did  not, 
—  obviously  a  totally  different  contract  from  that  which  was 
actually  made,  and  one,  too,  in  which  the  creditor  must 
either  lose  the  original  debt,  or  if  that  was  paid,  then  he 
must  lose  the  amount  which  he  had  paid  by  way  of  pre- 
miums. Thus  by  the  decision  of  the  court  the  creditor 
could  in  no  case  be  indemnified,  but,  on  the  contrary,  in 
every  case  must  be  the  loser.  The  contract  was  certainly 
for  an  indemnity  in  the  beginning,  and  had  it  been  enforced 
according  to  its  terms  it  would  have  proved  to  be  an  indem- 
nity in  the  end.  This  contract  of  insurance  on  the  life  of 
the  debtor  to  protect  the  creditor  is  closely  analogous  to  the 
mortgagee's  insurance  on  the  house  of  the  debtor  to  protect 
his  mortgage.  In  one  case  the  creditor  insures  on  the  life, 
in  the  other  on  the  property,  of  the  debtor.  In  each  case 
the  contract  is  a  separate  and  distinct  collateral  contract 
which  the  insured  has  a  right  to  make  for  his  own  benefit, 
and  there  seems  to  be  no  doubt  that  the  mortgagee,  whether 
he  insures  as  general  owner  or  as  mortgagee,  may  recover 
the  full  amount  insured,  without  prejudice  to  his  mortgage 
debt,  which,  whether  it  be  paid  or  unpaid,  is  a  matter  of  no 

207 


§116]         insurance;  fire,  life,  accident,  etc.         [CH.  VI. 

concern  to  the  insurers.  ^  If  a  mortgagee  insure  for  a  year 
tlic  house  of  his  debtor  to  sccnro  a  mortgage  note  payable  in 
a  year,  and  there  happens  a  total  loss  within  the  period,  he 
recovers  his  insurance  and  still  holds  his  note.  So  if  a 
creditor  insures  the  life  of  his  debtor  for  a  year  to  secure  a 
note  payable  in  a  year,  and  the  death  happens  within  the 
period,  he  gets  his  insurance  and  still  holds  the  note.  In 
each  case  there  is  indemnity  as  between  the  insurers  and  the 
mortgagee  and  creditor,  though  by  reason  of  their  relations 
with  strangers  to  the  insurers  the  mortgagee  and  creditor 
may  make  an  actual  profit  in  the  end  by  collecting  their 
respective  notes.  If  the  insurer  contracts  to  indemnify  in 
one  case,  so  he  does  in  the  other ;  and  neither  is  the  less  a 
contract  of  indemnity  because  the  insured  by  his  relations 
with  others  may  make  the  double  transaction  a  profitable 
investment  or  speculation.  A  man  insures  his  house  for  a 
term  of  years  to  protect  his  estate ;  and  he  insures  his  life 
for  a  term  of  years  for  the  same  reason.  If  the  house  be 
burned  the  estate  is  indemnified  for  the  loss  of  property; 
and  if  the  life  be  lost  the  estate  is  indemnified  for  the  loss 
of  faculties  which  produce  property.  In  either  case  there  is 
indemnity  simply.  In  one  case  the  amount  of  loss  may  or 
may  not  be  open  to  proof.     In  the  other  the  amount  of  loss 


1  King!'.  State  Mut.  Fire  Ins,  Co.,  7  Gush.  (Mass.)  1  ;  Suffolk  Fire  Ins.  Co. 
V.  Boyden,  9  Allen  (Mass.),  123  ;  Concord  Mut.  Fire  Ins.  Co.  v.  Woodbury,  45  Me. 
447  ;  Clark  v.  Wilson,  103  Mass.  219,  221  ;  People's  Ins.  Co.  v.  Straehle,  2  Cin. 
Superior  Ct.  Reptr.  186  ;  post,  §  456.  And  so  the  mortgagee  may  recover  the 
whole  amount  of  his  insurance  if  the  loss  amounts  to  so  much,  although  the 
property  remaining  after  the  iire  is  ample  security  for  the  debt,  or  be  restored 
to  its  original  value.  Rex  v.  Insurance  Cos.,  2  Phila.  Rep.  -357  ;  Kernochan  v. 
New  York  Bowery  Fire  Ins.  Co.,  5  Duer  (N.  Y.  Superior  Ct.),  1 ;  s.  c.  affirmed 
17  N.  Y.  428  ;  Motley  v.  Manufacturers'  Ins.  Co.,  29  Me.  337;  Foster  et  al.  v. 
Equitable  Mut.  Fire  Ins.  Co.,  2  Gray  (Mass.),  216.  But  a  mortgagee  who  so 
insures  without  the  authority  of  the  mortgagor  cannot  charge  the  premium 
against  the  mortgagor.  Dobson  v.  Land,  8  Hare,  216.  See  also  s.  c.  and  note, 
3  Bennett's  Fire  Ins.  Cases,  197  ;  Excelsior  Fire  Ins.  Co.  v.  Royal  Ins.  Co.,  55 
N.  Y.  343,  affirming  s.  c.  7  Lans.  (N.  Y.)  138  ;  Armitage  v.  Winterbottom,  30 
E.  C.  L.  379.  So  the  insured  who  has  contracted  to  sell  before  the  loss  may 
recover  the  full  amount  of  the  loss  although  after  the  loss  and  before  suit  he 
receives  the  contract  price,  there  being  a  parol  agreement  to  assign  the  policy 
with  the  consignee  of  the  property.  Fire  &  Mar.  Ins.  Co.  v.  Morrison,  11  Leigh 
(Va.),  354.     And  see  also  Washington  Fire  Ins.  Co.  v.  Kelly,  32  Md.  421. 

208 


CH.  VI.]  SUBJECT-MATTER. — INSURABLE   INTEREST.  [§117 

is  fixed  by  the  valuation  in  the  policy  and  the  agreement  of 
the  parties.  But  it  is  none  the  less  an  indemnity  because  it 
is  agreed  on.^  Mortgagees  and  creditors  may  claim  indem- 
nity of  the  insurers  with  whom  they  directly  contract,  though 
they  may  have  chances  to  get  something  beyond  that  from 
others,  and  in  this  sense  their  contracts  may,  though  not 
with  strict  accuracy,  be  said  to  be  not  contracts  of  indem- 
nity merely.  This,  it  is  apprehended,  is  all  that  is  intended 
by  the  court  in  the  case  of  Dalby  v.  India  and  London  Life 
Assurance  Company. ^  That  case  decides  only  that  as  at 
common  law  the  contract  of  life  insurance  may  be  supported 
without  any  insurable  interest  in  the  insured  either  at  the 
inception  of  the  contract  or  at  the  death  of  the  life,  and  as 
under  statute  14  Geo.  IIL  c.  48,  only  an  insurable  interest 
is  requisite  at  the  inception  of  the  contract,  it  is  not  neces- 
sary that  the  insured  should  have  an  insurable  interest  at 
the  time  of  the  death.  In  other  words,  under  that  statute 
the  contract  is  one  of  indemnity  at  its  incipiency,  but  by  the 
common  law,  which  is  not  affected  by  the  statute,  it  need 
not  be  one  of  indemnity,  —  that  is,  supported  by  an  interest, 
at  the  time  of  the  death. 

§  117.  Continuation  of  Interest  in  the  "  Life  ;  "  United  States 
cases.  —  The  courts  of  this  country  have,  however,  as  we 
have  seen,^  almost  without  exception*  refused  to  adopt  the 
doctrine  of  the  English  common  law  in  support  of  policies 
without  interest,  and  it  remains  to  be  seen  whether  they  will 
so  far  modify  the  rule  as  to  uphold  a  policy  where  the  insured 
has  an  interest  when  the  contract  is  made,  but  has  none  when 
the  event  happens  upon  which  the  policy  becomes  payable. 
That  the  insurable  interest  need  not  have  uninterrupted 
continuity,  but  may  revive  after  suspension,  has  before  been 
adverted  to.^     In  the  Supreme  Court  of  the  United  States^ 

1  St.  John  V.  American  Mut.  Life  Ins.  Co.,  2  Duer  (N.  Y.  Superior  Ct.),  419; 
ante,  §  7. 

2  Ubi  supra. 

3  Ante,  §  75. 

*  [This  can  hardly  be  said  now.     See  cases  below.] 

6  Jntc,  §  101. 

6  Phcenix  Mut.  Life  lus.  Co.  of  Hartford  v.  Bailey,  13  Wall.  (U.  S.)  616. 

VOL.  I.  — 14  ,  209 


^117]         insurance:  fike,  life,  accident,  etc.        [ch.  vl 

it  lias  been  said  that  the  contract  of  life  insurance  was 
not  one  of  mere  indemnity,  and  that  an  insurable  inter- 
est was  only  necessary  at  the  inception  of  the  contract. 
But  the  point  decided  was  simply  that  that  court  would 
not  exercise  its  equity  power  when  there  was  an  adequate 
remedy  at  law;  and  the  cases  referred  to  as  supporting 
the  dictum,^  with  the  exception  of  the  English  case,  are 
not  authorities,  since  in  all  of  them,  in  point  of  fact,  the 
interest  existed  at  the  time  of  the  death  as  well  as  at  the 
inception  of  the  contract.  There  are  dicta,  however,  in 
the  New  York  and  New  Jersey  cases  referred  to,  as  also  in 
other  cases, 2  which  would  seem  to  support  the  view  that  a 
continuing  interest  in  a  life  policy  is  not  necessary.  ^  (a)  Upon 
the  whole,  it  is  not  improbable  that,  when  the  point  is  dis- 
tinctly taken,  it  will  be  held  that  when  the  contract  at  its 
inception  is  based  upon  a  substantial  interest,  and  is  in  good 
faith  entered  into  for  the  protection  of  that  interest,  it  is 
not  objectionable  as  a  wager  contract,  and  may  be  enforced 
though  the  interest  may  have  ceased  at  the  time  of  the  death. 

1  Dalby  v.  India  &  London  Life  Assurance  Co.,  15  C.  B.  365  ;  Loomis  v. 
Eagle  Life  &  Health  Ins.  Co.,  6  Gray  (Mass),  396  ;  Lord  v.  Dall,  12  Mass. 
114;  Trenton  Life  &  Fire  Ins.  Co.  v.  Johnson,  4  Zab.  (N.  J.)  576;  Kawls  r. 
American  Life  Ins.  Co.,  36  Barb.  (N.  Y.)  357 ;  s.  c.  27  N.  Y.  282.  Emmet,  J., 
dissenting,  on  the  ground  that,  before  the  death  of  the  debtor  whose  life  was 
insured,  the  Statute  of  Limitations  having  run  against  the  note  which  constituted 
the  basis  of  insurable  interest  at  the  inception  of  the  contract,  the  interest  had 
ceased,  and  so  the  action  could  not  be  supported.  But  this  ground  of  dissent  is 
not  well  founded.  See  ante,  §  108.  See  also  Porter  y.  ^tna  Ins.  Co.,  6  Ins.  L. 
J.  928,  contra,  which,  however,  is  doubtful  law.  An  absolute  though  defective 
title  is  good  as  a  basis  of  interest  till  set  aside.     Ante,  §§  86,  89. 

2  Valton  V.  National  Loan  Fund  Life  Assurance  Co.,  22  Barb.  (N.  Y.)  9  ;  St. 
John  V.  American  Mut.  Life  Ins.  Co.,  13  N.  Y.  31. 

8  But  see  contra,  Mut.  Life  Ins.  Co.  v.  Wager,  27  Barb.  354  ;  Kennedy  v.  New 
York  Life  Ins.  Co.,  10  Ea.  An.  809,  dissenting  opinion  of  Mr.  Justice  Lee  ; 
Leonard  v.  Eagle  Life  &  Health  Ins.  Co.,  4  Liv.  Law  Mag.,  per  Ch.  Walworth 
as  arbitrator. 

(a)    In  New  Jersej',  it  has  recently  loss.     Sun  Ins.  Office  v.  Merz  (N.  J.  L.), 

been  held  that  though  the  insured  had  45  Atl.  785. 

no  insurable  interest  when  the  policy  The   objection    that    the    plaintiffs 

was  issued  to  him,  yet  the  policy  will  pleadings  do  not  set  out  an  insurable 

be  supported  if  there  is  such  an  interest  interest   comes   too   late  after   verdict, 

during  the  risk  and  at  the  time  of  the  Kentucky  L.  &  Ace.  Ins.  Co.  v,  Hamil- 


210 


ton,  63  Fed.  Rep.  93,  102. 


CH.  VI.]  SUBJECT-MATTER.  —  INSUEABLE   INTEREST.  [§117 

And  this  is  the  more  probable,  as,  while  such  a  rule  will 
keep  the  door  shut  against  mere  gambling  and  speculation, 
it  will  tend  to  encourage  what  is  now  almost  universally 
regarded  as  a  provident  contract,  securing  not  only  an  in- 
demnity in  case  of  loss,  but  the  means  of  presently  increas- 
ing capital,  and  a  not  disadvantageous  mode  of  investment. 
So  it  has  now  been  distinctly  held  in  the  Supreme  Court  of 
the  United  States  ;i  [and  later  cases  in  Pennsylvania  and 
the  United  States  courts  make  the  authority  to  this  point 
very  emphatic."]  The  conclusion  is,  upon  all  the  authori- 
ties, that  life  insurance,  like  all  other  kinds  of  insurance, 
is  a  contract  of  indemnity ;  but  that  that  form  of  the  con- 
tract, in  some  of  its  phases,  is  not  merely  a  contract  of  in- 
demnity, but  includes  that  with  a  possibility  of  something 
more.  It  can  never  therefore  properly  be  entered  into  ex- 
cept for  the  purpose  of  security  or  indemnity  ;3  though  the 
fact  that  the  contract  may,  under  certain  circumstances, 
result  as  a  profitable  investment,  does  not  vitiate  it,  if  en- 
tered into  in  conformity  to  the  principles  which  underlie  it.* 
But  so  far  as  it  seeks  any  other  object  than  indemnity  for 
loss,  it  departs  from  the  legitimate  field  of  insurance,  and 
engrafts  upon  that  contract  a  purpose  foreign  to  its  nature. 

1  Connecticut  Mut.  Life  Ins.  Co.  v.  Scheafer,  94  U.  S.  457. 

2  [See  §  100,  A.] 
8  Ante,  §  2. 

*  [True  justice  would  give  the  balance  of  the  funds  beyond  the  debt,  pre- 
miums, interest,  and  expenses,  to  the  debtor's  representatives,  and  there  is  some 
good  authority  to  this  effect.  Seegrist  v.  Schmoltz,  113  Pa.  St.  826,  and  see 
ch.  24.] 


211 


insurance:  fire,  life,  accident,  etc.       [ch.  vil 


CHAPTER  YII. 

agents.  —  their  powers  and  duties. 

Analysis. 

1.  Of  the  General  Principles  of  Agency,  and    specially  of  Agents  , 

OF  Stock  Insurance  Companies. 
An  agent  must  not  be  interested  adversely  to  his  principal,  if  same  per- 
son acts  for  both  parties  either  may  avoid  the  contract,  §§  125,  137. 
cannot  insure  property  of  which  he  is  owner  or  part-owner  unless  the 
company  is  fully  aware  of  the  facts,  and  constructive  knowledge  by 
putting  the  papers  on  file  in  home  office  is  not  enough.     Id. 
cannot  consent  to  assignment  of  his  own  policy,  §  137. 
» 

POWER   TO    BIND   THE    COMPANY. 

An  agent's  authority  is  governed  by  the  nature  of  his  business.  Acts, 
waivers,  representations,  &c.,  in  the  lisual  course  of  business  will 
bind  the  principal  in  spite  of  private  instructions,  unless  the  other 
party  had  notice  of  them.  The  authority  of  an  agent  is  what  it  ap- 
pears to  be ;  as  between  the  company  and  third  persons  the  question  is 
not  what  power  the  agent  did  have,  but  what  the  company  held  him 
out  as  having.  Out  of  the  usual  course  of  business,  the  assured  must 
be  sure  the  agent  has  express  authority.  Authority  to  two  persons 
terminates  with  the  death  of  either,  §§  126,  126  A,  154. 

Difficult  to  determine  the  scope  of  an  insurance  agent's  powers,  §  118. 

May  solicit  risks,  and  make  statements  concerning  the  character  and 
standing  of  the  various  companies,  §§  119,  133. 

He  has  incidental  power  to  decide  upon  the  proper  description  of  prop- 
erty, the  meaning  of  words  in  the  questions,  and  the  application  of 
answers  to  the  subject-matter,  so  far  as  may  be  necessary  to  render  the 
instrument  fit  for  its  purposes  and  make  the  agency  an  efficient 
one,  §§  120,  123,  144  E,  144  G. 
the  agent's  discretion  may  vary  with  his  remoteness  from  the  home 
office,  §  120. 

Agent  of  stock  company  intrusted  with  policies  signed  in  blank  has  full 
discretion  as  to  amount  and  nature  of  risk,  terms,  conditions,  &c., 
even  to  the  modification  of  the  policy,  §  129  and  note. 

Within  the  powers  of  the  corporation  its  agents  may  bind  it  by  parol, 
§§  128,  129,  141-145,  151  ;  see  also,  §§  14-25. 

May  insure  in  respect  to  property  beyond  his  district,  §  130. 

2.  Authority  AS  to  Premiums  (§§  121,  129,  134-136). 

Discretion  about  the  mode  in  which  premiums  shall  be  paid,  limited  by 
usual  course  of  business.  Agent  may  by  his  interpretation  fix  the 
date  the  premium  is  due,  §  134. 

212 


CH.    VII.]         AGENTS.  —  THEIR   POWEES   AND   DUTIES. 

Neglect  of  agent  to  forward  precuium  will  not  prejudice  the  insured. 
Where  the  agent  is  a  broker.  A  receipt  for  the  premium  stating 
that  the  contract  takes  etiect  from  its  date  binds  the  company,  though 
the  premium  is  not  actually  paid  till  after  the  tire,  §  135. 

If  an  agent  receives  premiums  upon  a  life  policy  knowing  of  a  change 
of  residence  in  violation  of  the  policy,  which  the  agent  said  would 
not  affect  it  if  the  premiums  were  paid,  the  company  may  be  held,  on 
the  principle  of  constructive  notice,  since  it  was  the  duty  of  the 
agent  to  inform  the  home  office  of  the  conditions  under  which  the 
premiums  were  paid,  §  136. 

Agent  may  waive  forfeiture  for  non-payment  of  premium  before  or 
after  it  is  due,  §  136. 

An  agent  may  perhaps  employ  a  detective,  but  cannot  institute  criminal 
proceedings  so  that  his  acts  will  bind  the  company,  unless  specially 
authorized,  §  133  F. 

3.  Error,  Neglect  or  Misrepresentation  by  the  Agent. 

Mistakes,  omissions,  even  in  some  cas'es  representations  or  opinions  of  a 
matter  of  law,  on  the  part  of  an  agent  within  the  scope  of  his  business, 
will  bind  the  company,  §§  131,  135,  142. 
A  corporation  cannot  saddle  the  blunders  of  its  agents  on  its  customers. 
If,  however,  the  insured  combines  with  agent  to  cheat  the  company 
the  latter  will  be  protected,  §  131. 
(See  4,  5,  and  6.) 
Misrepresentati(m,s  and  torts  of  agent.     Same  rules  apply  as  in  the  case 
of  other  contracts.      Mere  opinion,  embellishment  or  chaffer, 
will  not  bind  the  company,  nor  statements  upon  which  a  man  of 
ordinary  prudence  would  not  rely,  §§  133,  133  C. 
Representation  that  the  company  takes  risks  in  a  place  where  it 

does  not,  will  not  prejudice  the  company,  §  133. 
Unauthorized  representation  of  agent  that  neglect  to  pay  premium 
■would  only  convert  the  policy  into  a  paid-up  policy,    binds 
company  so  far  as  to  prevent  forfeiture  because  insured  has 
acted  on  it,  §  133. 
Misrepresentation  that  non-occupancy  avoided  policy,  whereby  in- 
sured settled  for  one-fourth,  is  not  actionable,  §  133.    " 
Misrepresentation  as  to  rival  company  not  release  insured  from  duty 

to  pay  premium,  §  133. 
Misrepresentation  that  policy  is  not  subject  to  assessment,  entitles 

the  insured  to  such  a  policy,  §  133. 
Where  full  printed  information  is  given  to  the  insured  he  must  not 
rely  on  the  agent's  remarks,  §  133. 
nor  without  inqtiiry  on  the  remarks  of  a  stranger  though 
in  presence  of  an  officer,  §  133. 
Representations  not  to  bind  company,  unless  reduced  to  writing  and 
sent  to  home  office,  §  133. 

4.  Notice. 

Notice  to  agent  in  the  scope  of  his  business  is  notice  to  his  principal, 
§§  132,^  152. 

An  agent  appointed  to  receive  and  transmit  the  kind  of  notice  in  question, 
receiving  it  as  such  agent,  binds  the  principal,  and  one  acting  in  the 
principal's  business  to  which  the  notice  relates,  with  the  knowledge 

213 


INSURANCE :  FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  VII. 

in  his  mind,  or  so  recently  acquired  as  to  be  presumably  present  in 
his  mind,  binds  his  principal  by  his  knowledge,  no  matter  when,  how, 
or  where  he  received  the  knowledge  (§  133  D),  unless  there  is  collu- 
sion, or  the  third  party  knows  or  has  reason  to  know  that  the  agent 
does  not  inform  the  principal. 

Where  the  agent  does  not  act  in  the  matter  to  affect  the  validity  of 
which  the  notice  is  pleaded,  nor  is  appointed  to  forward  such  notice 
in  respect  to  the  use  in  question,  his  knowledge  is  not  that  of  the 
principal  as  affects  said  matter,  §§  122,  n,  133  E. 

Grounds  of  holding  the  company  are  communication  and  identity.  The 
agent  while  acting  for  the  company  within  the  scope  of  his  authority 
is  identified  with  the  company ;  and  notice  coming  to  him  during 
such  business  and  relating  to  it  binds  the  company.  Notice  coming 
to  the  agent  at  some  time  while  not  acting  for  the  company  in  the 
business  to  which  it  relates,  may  bind  the  company,  on  the  ground 
that  it  was  the  agent's  duty  to  communicate  facts  known  to  him 
and  affecting  his  principal. 

5.  Facts  hioivn  to  agent  at  time  of  insurance  or  at  delivery  of  policy 

bind  the  company,  §§  133,  133  A-133  G. 
condition  of  health,  §  133  A. 
prohibited  articles  kept,  §  133  A. 
gasolene  kept  on  premises,  §  133  A, 
buildings  not  all  on  plaintiff's  ground,  §  133  A. 
interest  of  assured  known  to  agent,  §  133  A. 
agent  knew  of  incumbrance,  §  133  A. 

other  insurance,  §  133  A. 
even  though  falsely  stated  by  assured  ?  §  133  A. 
agent's  notice  of  inaccuracy  in  the  application  binds  the  com- 
pany, §  142  F. 
an  agent's  acts  in  procuring  insurance,  making  out  applications, 
&c.,  and  his  knowledge  obtained  in  such  business  bind 
the  company.     Such  an  application  is  not  the  instru- 
ment of  the  person  whose  name  is  signed  to  it.     The 
circumstances  under  which  it  was  obtained  estop  the 
company,  §§133,  133  A,  133  B,  144. 
if,  in  filling  the  application,  by  mistake  or  intent  he  omits  or 
misstates  matters  correctly  told  him  or  known  to  him, 
and  the  assured  signs  the  statement  without  reading 
and  in  ignorance  of  the  omission  or  mistake,  the  com- 
pany is  bound,  §§ 141,  144  A. 
there  being  no  collusion  to  cheat  the  company  or  its 

equivalent,  §§  144  B,  137. 
as  where  the  assured  has  reason  to  know  that  the  com- 
pany is  being  imposed  on,  §§  133  B,  137. 
even  though  the   policy  makes  the  statements  warran- 
ties, §§  144  A,  133  A. 
(Contra,  even  knowledge  of  company  itself  will 
not  save  the  assured  in  case  a  warranty  is 
broken,  §§  145,  156.) 
and  the  agent's  knowledge  was  obtained  in  another 
transaction,  §  144  B. 

214 


CH.  VII.]         AGENTS.  —  THEIR   POWERS   AND   DUTIES. 

and  the  policy  provides  tliat  the  agent  acts  for  the  as- 
sured, §§  124  A,  144  B,  140,  144  E,  144  G. 
and  that  no  agent  shall  waive  any  condition,  §  144  C. 
and  a  copy  of  the  application  is  attached  to  the  policy, 
§  144  C. 
an  application  made  by  agent  with  knowledge  of  facts  is 
conclusive  on  company  by  statute  in  some  States, 
§145B. 
so  where  the  agent  causes  the  assured  to  make  a  misstate- 
ment or  omission,  the  latter  acting  in  good  faith, 
§  144  E.  , 

or  where  both  are  ignorant  of  the  truth  and  the  agent  makes 

a  misstatement,  §  144  E. 
but  statements  to  agent  at  a  fruitless  interview  prior  to  the 
one  at  which  the  insurance  is  made  do  not  bind  com- 
pany, §  144. 
and  if  the  policy  describes  the  wrong  building  though  by 

agent's  error,  it  is  void,  §  144  F. 
limitations  by  tenns  of  policy,  §  137. 
usage  may  overcome,  §  137. 

premiums  only  payable  on  company's  receipt,  §  137. 
excluding  saloon  lisk,  knowledge  of  agent  not  bind 

company,  §  137  A. 
prohibited  article  avoids  policy  though  agent  knew  it 
was  kept,  §  144  F. 

6  Massachusetts,  Khode  Island,  New  Jersey,  Pennsylvania  Canada, 

and  Nova  Scotia,  however,  regard  the  admission  of  parol  to 
show  that  the  insurers  knew  the  contrary  of  that  which  is 
stated  in  the  application  as  a  violation  of  the  rule  against 
varying  a  written  document  by  parol,  and  refuse  to  receive 
such  evidence,  although  the  application  was  made  by  the 
a<^ent ;  Massachusetts  going  to  the  same  length  even  where 
the  insurer  himself  or  a  general  agent  making  contracts 
knew  the  truth,  §  145.  . 

The  true  rule  seems  to  lie  between  the  Massachusetts  doctrine  and 
that  of  the  majority  of  the  States.     It  surely  cannot  preju- 
dice the  company  to  hold  that  it  knew  what  it  did  know, 
nor  is  it  fair  to  relieve  the  assured,  where  the  company  has 
been  really  misled,  simply  because  he  was  too  careless  to 
read  the  application  he  signed,  although  he  was  able  to  do 
so,  and  knew  or  ought  to  have  known  that  the  agent  was 
only  a  solicitor,  the  contract  being  made  at  the  home  ottice. 
(Discussion  of  whole  subject,  §  144  G. ) 
The  company  should  be  held,  if  it  knows  the  truth,  or  con- 
nives at  the  agent's  wrong,  or  the  agent  having  knowl- 
edge of  the  facts  is  a  general  agent  making  contracts 
himself,  §  144  G. 
or  a  verbal   application   is   accepted,  and  afterwards  the 
agent  makes  a  written  one  without  authority  from 
the  assured,  §§  144  D,  145. 
(unless  it  is  afterwards  adopted,  §  141.) 
^  215 


INSURANCE  :   FIRE,   LIFE,   ACCIDENT,    ETC.         [CH.  VII. 

or  there  is  a  usage  or  other  evidence,  to  show  that  some  or 
all  of  the  statements  may  be  made  by  the  agent  on 
his  own  authority  and  are  so  understood,  although 
the  assured  signs  the  paper,  he  being  innocent  of 
intended  wrong,  §§132,  144  G. 
or  reading  the  papers  and  other  proper  acts  of  care  would 
not  enable  the  insured  to  discover  the  error  or 
fraud,  as  where  the  agent  substitutes  a  forged  appli- 
cation for  the  true  one  signed  by  the  assured, 
§§  144  D,  144  G.  (Iowa  case.) 
or  where  the  assured  with  good  faith  and  prudence  is  led 

by  the  agent's  advice  into  a  mistake,  §  144  E. 
as  to  make  an  omission,  §  133  A,  n. 

or  the  agent  takes  advantage   of   an   ignorant   applicant, 
§§  144  B,  144  E. 
(it  is  doubtful  if  even  the  delivery  of  a  policy  to 
one  who  cannot  read  is  notice,  §  144  E  ;  see 
§  144  G.) 
If  the  company  is  innocent  and  the  assured  agrees  with  the  agent 
to  cheat  the  company,  §§  133  B,  143. 
or  knows  that  a  wrong  statement  is  being  made,  §  144  F. 
or  has  good  reason  to  know  that  the  agent  is  not  acting  fairly 
and  for  the  company's  interest  in  the  matter,  §§  133  B, 
137,  143,  144  B,  144  F,  144  G. 
or  signs  to  an  untruth  that  he  could  correct  if  he  took  pains 
to  read  the  paper  he  signs,  in  dealing  with  a  soliciting 
agent,  §§  143,  144  E,  144  G,  145  A. 
or  contents  himself  with  telling  such  an  agent  material  facts 

without  putting  them  in  the  application,  §  144  F. 
he  should  recover  nothing  if  he  acted  in  bad  faith,  and  only 
his  premiums  and  interest  if  merely  careless.     The  fact 
that  his  signature  is  required  is  sufficient  notice  to  him 
that  the  company  does  not  rely  on  the  agent  to  state  the 
facts  to  them,  §  144  G. 
the  applicant  is  presumed  to  read  the  statements  he  signs, 
and   the   burden   is    on    him    to    show   the    contrary, 
§§  144  E,   159. 
If  the  policy  provides  that  the  assured  adopts  and  warrants  the 
application,  or  that  the  company  will  not  be  responsible 
for  any  statements  the  agent  did  not  put  in  the  applica- 
tion, the  assured  is  bound,  in   the  absence  of  fraud  or 
fault    in    the   home  office,   §§  137  A,    140,    141,   144  F, 
145  A. 
even  though  the  application  was  originally  unauthorized, 
§141. 
if  the  agent  making  the  application  is  not  the  agent  of  the  com- 
pany, or  in  any  case  where  the  assured  makes  him  his 
agent  to  get  the  facts,  he  is  bound,  §§  144  G,  145  A. 
neglect  of  agent  to  get  insured  to  sign  the  application,  company 
estopped,  §  133  C. 
or  to  transmit,  till  after  loss,  company  estopped,  §  133  C. 
agent  destroying  policy,  company  bound,  §  133  C. 

216 


CH.  VII.]  AGENTS. — THEIR   TOWERS   AND    DUTIES. 

notice  to  an  agent  of  subsequent  insurance  or  alienation  held  not 
to  bind  company  in  Pennsylvania  and  Massachusetts, 
§  153. 

but  notice  of  increase  of  risk  was  held  binding  in  a  Pennsylva- 
nia case,  §  150. 

7.  Authority  after  Negotiations  are  completed. 

Once  the  contract  is  complete  the  agent's  discretion  for  the  company  as 

to  matters  subsequently  arising  is  much  less  than  his  discretion 

during  the  negotiations,  §§  129,  138. 

it  behooves  the  insured  therefore  to  inquire  carefully  as  to  the  agent's 

powers  in  subsequent  dealings,  §  138. 

We  have  seen  above  under  "Notice"  and  "Premiums,"  some  of  the 

law  of  this  topic. 
A  General  Agent  may  orally  extend  an  open  policy  over  other  property 
similar  to  that  which  it  already  insures,  may  correct  an  error  in 
policy  after  issue,    waive   proof    of    loss    (Massachusetts    contra, 
§  126),  prepayment  of  premium,  notice  of  other  insurance,  and 
conditions   as  to  countersigning,  bringing  suit,  making   repairs, 
leaving  property  vacant,  &c.,  §§  128,  129,  151.     See  also,  §§  14-25. 
may  adjust  loss,  cancel  policy,  §  138. 
receive  notice  of  increase  of  risk,  §  150. 

may  waive  change  of  residence  or  nonpayment  of  premium,  §  136. 
can  modify  or  cancel  any  contract  he  can  make,  §  129,  n. 
and  consent  to  further  insurance  or  change  of  title,  §  143.     Pennsyl- 
vania   and    Massachusetts    contra,    §   153.      (See    above    under 
"Notice.") 
the  tendency  of  the  courts  is  to  hold  the  company  to  the  acts  of  its 

agents,  in  favor  of  one  relying  on  them  without  fault,  §  143. 
Evidence  of  general  agency,  §  126. 

possession  of  blank  policies  and  receipts  are  evidences  of  general 

agency,  §  126. 
whether  an  agency  is  general  is  a  question  for  the  jury,  §  126. 
the  assured  bound  to  know  if  agent  is  general  or  special,  §  138. 

8.  Miscellaneous. 

Agent  of  foreign  company  to  receive  service,  §  126. 

authority  to  allow  change  of  risk  carries  power  to  waive  forfeiture  by 

change,  §  126. 
authoritv  to  settle  for  loss  carries  right  to  extend  time  for  settlement, 

§126. 
courts  tend  to  enlarge  powers  of  agents,  §  126. 
contract  by  officers  beyond  their  powers  under  the  charter  and  by-laws 

may  be  good,  §  126. 
agent  cannot  ratify  a  contract  void  by  fraud  ab  initio,  §  136  A. 
agent  cannot  reinsure  his  company's  risks  without  special  authority, 

§   126  A. 
mere  soliciting  agent  cannot  assent  to  assignment,  §  138. 

nor  waive  proofs,  §  129. 

nor  alter  policy  to  make  it  payable  to  another  than  the  assured, 
§  130  A. 

nor  assent  to  assignment,  §  138. 
an  alteration  of  a  policv  may  be  ratified,  §  130  A. 

217 


INSURANCE :    FIRE,   LIFE,   ACCIDENT,   ETC.       [CH.  VIL 

an  alteration  by  agent  without  authority  voids  policy,   but   company 

held  by  first  intention  of  parties,  §  130  A. 
provision  in   policy  is  notice   of  limitation  of  agent's  authority  as  to 

waiver  of  renewal  ])remiunis,  §  126. 
provision  on  back  of  policy  not  notice,  §  126. 

9.  Waiver. 

Receipt  of  premium  by  book-keeper  does  not  waive,  §  136  A. 

by  agent  authorized  to  take  premiums  after  knowledge  waives  a 
change  of  residence,  §  136. 
or  forfeiture  for  non-payment,  §  136. 
secretary  may  waive  breach,  §  136. 
by  usage,  §  137. 

by  usual  course  of  business,  of  condition  as  to  written  assent  to  assign- 
ment, §  139. 
No  waiver  — 

of  written  assent  to  increase  of  risk,  §  137  A. 

or  removal,  §  137  A. 
of  non-payment  when  policy  provides  that  agent  cannot  vary  it, 

§  137  A. 
if  policy  restricts  right  to  waive  to  home  office,  §  137  A. 
or  declares  that  the  agent  is  not  to  vary  the  policy,  §  137  A. 

such  provisions  valid  as  to  waivers  attempted   after  issue, 

§  137  A. 
not   as  to   those    before   issue  unless  brought  to  notice   of 

assured,  §  137  A. 
usage  may  overcome  the  provision  entirely,  §  137  A. 
of  proofs  of  forfeiture  by  adjuster,  §  138. 

10.  Company  v.  Agent. 

Company  may  recover  difference  between  premium  charged  and  what 
ought  to  have  been  charged  if  agent  had  disclosed  facts,  §  138  B. 
agent  no  claim  because  his  term  of  office  is  broken  by  insolvency  of 

company,  §  138  B. 
agent  exonerated  by  honestly  adopting  one  of  two  possible  interpreta- 
tions of  an  order  from  company,  §  138  B. 
Cessation  of  agency : 

when  company  goes  out  of  business,  §  138  C. 

proofs  sent  to  one  who  has  ceased  to  be  agent  good  if  assured  no 

notice,  §  138  C. 
promise  to  renew  by  such  agent  only  makes  him  personally  liable, 

§  138  C. 
annual  license  to  company  in  name  of  agent  gives  him  no  right  to 
hold  to  the  end  of  year,  §  138  C. 
Agent's  authority  may  be  limited  by  the  terms  of  the  application  and 
the  policy,  §  137.     See  §  140. 

11.  Age.vts  of  Mutual  Companies. 

Agents  of  mutual  companies  governed  by  much  the  same  principles 
as  agents  of  stock  companies.  Any  customary  exercise  of  au- 
thority known  to  the  principal  and  not  repudiated  will  bind  him, 
§139. 

218 


CH.  VII.]  AGENTS.  —  THEIR   POWERS   AND    DUTIES. 

The  agent  acts  in  the  negotiations  only  as  agent  of  the  company  and  not 
of  the  assured,  for  the  hitter  is  not  a  member  of  the  company  until 
the  contract  is  made,  §  131  ;  and  a  stipulation  in  the  policy  or  in 
the  by-laws  that  the  agent  of  the  company  is  also  the  agent  of  the 
insured  will  not  make  it  so  if  the  fact  is  otherwise.  Acts  done  on 
behalf  of  the  insurers  and  without  the  authority  of  the  insured  do 
not  bind  the  latter. 

An  agent's  overestimate  of  value  binds  the  company.  If  an  agent 
neglects  to  state  an  incumbrance  mentioned  by  the  insured,  com- 
pany cannot  set  up  his  negligence,  §  140. 

The  law  construes  the  powers  of  agents  of  mutual  companies  more  strictly 
than  those  of  stock  company  agents,  §  127,  and  in  Massachusetts 
the  decisions  are  very  strict,  it  being  held  that  such  agents  cannot 
bind  the  company  contrary  to  by-laws,  §§  145,  146.  Except  that 
by-laws  not  of  the  essence  of  the  contract,  such  as  those  that 
relate  merely  to  the  form  and  mode  of  proving  loss,  may  be  waived, 
§147. 
In    Pennsylvania  also   the   distinction    between   mutual   and   stock 

companies  is  emphasized,  §§  148,  149. 
See  on  this  subject  also  the  whole  text  from  §  139  to  §  151,  espe- 
cially the  decision  of  the  United  States  Supreme  Court  that  a 
mutual  company  is  bound  by  the  acts  and  knowledge  of  its  agent 
in  drawing  up  the  application  as  it  is  ordinarily  done,  just  as  a 
stock  company  is  liable  under  the  same  circumstances.  The  ap- 
plication rea/Uy  is  often  the  act  of  the  insurers,  §  144. 

secretary  as  agent  of  directors,  §  139. 

directors  may  appoint  president  to  indorse,  §  139. 

12.  Agents  of  Accident  Insurance  Companies,  §  155. 
Sub-agents. 

General  agent  may  appoint  sub-agents,  local  agent  cannot,  §§  126, 154  A. 

Any  sub-agent  or  clerk  appointed  by  an  agent  with  consent  or  recog- 
nition of  the  company  may  bind  it.  The  service  of  an  insurance 
agent  is  not  personal,  and  he  has  an  implied  power  of  delegation 
unless  restricted,  §  154. 

Knowledge  of,  binds  company,  §§  132,  140,  154  A. 

Agent's  responsibility  for,  question  for  jury,  §  154  A. 

13.  Agents  of  the  Insured. 

Principal  bound  by  acts  of  his  agent,  §  122. 
if  same  person  is  agent  of  insured  and  the  company,  notice  of  cancel- 
lation to  him  is  good,  §  122. 
One  recovering  insurance  money  may  show,  when  sued  for  it,  that  he 

was  the  agent  of  one  who  had  an  insurable  interest,  §  122. 
Persons  referred  to  by  the  applicant  become  his  agents  for  the  purposes 

covered  by  the  reference  doctors,  broker,  §  123. 
Responsible  for  ordinary  care.     One  having  general  authority  to  insure 
for  another  may  not  choose  a  mutual  company,  §  124. 
effecting  insurance  with  irresponsible  persons  is  negligence,  §  124. 
measure  of  damages  in  such  case,  §  1 24. 
that  agency  gratuitous  no  defence,  §  124. 

219 


§  118]  INSURANCE  :    FIRE,    LIFE,    ACCIDENT,   ETC.  [cil.  YII. 

assured  may  ratify  contracts  made  for  his  benefit  but  without  au- 
thority, §  122  A. 
full  knowledge  of  facts  necessary  to  valid  ratification,  §  122  A. 
constructive  knowledge  sometimes  held  sufficient,  §  122  A. 
acceptance  of  policy  ratifies  agent's  act  in  giving  a  premium  note, 
§  122  A. 
Agent  to  procure  insurance  no  power  to  cancel,  §  138. 

14.  Whose  Agent,  §§  124  A,  144  G. 

Medical  examiner  agent  of  company,  but  may  not  advise  as  to  filling  up 

application,  §  123. 
persons  referred  to,  how  far  insured  responsible  for  their   statements, 

§123. 
statements  of  the  "life,"  §  123. 
broker  employed  to  effect  insurance,  agent  of  one  who  employs  him, 

§§  123,  124  A. 
an  insurance  agent  who  goes  to  another,  to  place  part  of  risk  without 

insured's  knowledge,  does  not  bind  him  by  misrepresentations, 

§  124  A. 
but  if  he  acts  with  authority  of  insured  he  i&  his  agent,  §  124  A. 
clause  in  policy  declaring  company  not  bomid  by  acts  of  agent  will  not 

be  operative  ;  the  facts  must  determine  whose  agent  the  actor  is, 

§§  124  A,  140,  144  B,  144  E,  144  G. 
Iowa  statute,  soliciting  agent  to  be  deemed  agent  of  company  in  spite  of 

any  agreement  to  the  contrary,  §  124  A. 
agent  keeping  lists  of  policies  for  the  assured  acts  as  his  agent,  and  the 

memoranda  will  not  be  evidence  of  recognition  of  policy  by  the 

agent's  company,  §  124  A. 
if  assured  asks  the  agent  to  gather  facts  for  him  he  makes  him  his  own 

agent,  §  145  A. 

15.  Proof  of  agency  must  be  given  by  assured,  §  138  A. 

power  of  attorney  or  resolution  of  directors  good  evidence,  but  not 

necessary,  §  138  A. 
habit  of  paying  policies  issued  by  agent  sufficient,  §  138  A. 
receiving  application  and    premium,    and   issuing  policy   through 

agent,  sufficient,  §  13S  A. 
declaration  of  agent  no  evidence,  §  138  A. 
foreign  agents  must  have  certificate  of  auditor  (Illinois),  §  138  A. 

§118.  Agency. — The  Contract  of  insurance  is  in  many, 
perhaps,  more  recently,  in  most  cases  made  through  the  in- 
tervention of  agents.  This  gives  rise  to  a  multitude  of  ques- 
tions, the  solution  of  which  more  properly  belongs  to  a 
treatise  on  the  lavr  of  agency.  Some  of  these  questions, 
however,  are  so  intimately  connected  with  the  subject  of 
insurance,  having,  so  to  speak,  grown  out  of  its  peculiari- 
ties, as  to  require  special  notice  in  this  connection. 
220 


CH.  VII.]         AGENTS.  —  THEIR   POWERS   AND   DUTIES.  [§  119 

All  incorporated  companies  must  necessarily  act  tlirongh 
agents,  and  their  respective  officers  are  specially  appointed 
and  clothed  with  powers,  more  or  less  specific,  to  facilitate 
the  transaction  of  business.  To  these,  in  case  of  emergency, 
are  added  special  or  general  agents,  who  at  home  and  abroad 
exercise  very  extensive  powers.  What  is  the  fair  scope  of 
the  authority  of  these  agents,  now  so  numerous,  to  whom 
are  intrusted  the  duties,  partly  or  wholly,  of  soliciting  risks, 
receiving  and  forwarding  applications,  — being  supplied  with 
blanks  for  that  purpose,  —  receiving  premiums  and  deposit 
notes,  and  delivering  policies  ?  This  question  has  given 
rise  to  some  of  the  most  perplexing  difficulties,  and  to  a 
larger  proportion,  perhaps,  than  any  other,  of  the  contro- 
versies in  courts  of  law.  And  upon  a  superficial  examina- 
tion of  the  cases  there  would  seem  to  be  an  inextricable 
confusion,  if  not  an  irreconcilable  contradiction  of  opinion. 
But  upon  a  more  careful  examination  there  will  almost 
always  be  found  shades  of  difference  in  the  facts  and  cir- 
cumstances, upon  which  apparently  opposite  opinions  are 
founded,  sufficient  to  relieve  them  from  the  element  of  con- 
tradiction. Still,  for  the  very  reason  that  there  is  in  so 
many  cases  in  the  midst  of  a  general  similarity  a  particular 
dissimilarity  of  circumstances,  it  is  difficult,  not  to  say  im- 
possible, to  embrace  within  any  formula  of  words  rules  that 
would  be  sound  and  reliable.  It  will  doubtless  be  more 
satisfactory  to  state  the  questions  which  have  arisen,  and 
are  likely  to  arise,  with  their  judicial  solution,  under  each 
particular  head. 

§  119.  Authority  in  soliciting  Risks.  —  And,  first,  in  solic- 
iting risks,  with  what  powers  is  the  agent  clothed?  Of 
course  it  must  be  desired  and  expected  by  the  principal  that 
the  agent  in  this  particular  will  use  due  diligence  —  the 
greater  the  better,  if  not  unauthorized  —  in  procuring  risks 
and  extending  the  business.  This  implies  that  something 
is  to  be  said  of  the  character,  standing,  and  merits  of  the 
company,  and  of  its  desirability  as  a  means  and  protection. 
And  by  his  statements  of  fact  in  this  behalf  the  insurers 
will  be  bound. 

221 


§  120]  INSUKANCE:   fire,   life,   accident,   etc.         [oh.  VII. 

§  120.  Authority  as  to  Application.  —  But,  second,  and 
most  important  of  all,  what  is  the  extent  of  the  agent's 
power  with  reference  to  the  duty  of  receiving  and  forward- 
ing the  application?  Can  he  to  any  extent,  and  if  any,  to 
what,  bind  the  company  by  intervening  and  aiding  in  the 
filling  up  of  the  application?  That  he  can  so  do,  to  some 
extent,  there  can  be  no  reasonable  doubt. ^  He  is  appointed 
by  the  company  to  facilitate  and  promote  their  business.  To 
this  end  he  is  furnished  with  the  necessary  blanks,  which, 
after  they  are  filled  up,  he  is  to  forward  to  the  company's 
office.  Of  course  this  filling  up  must  be  in  such  manner  as 
to  make  the  application  fit  for  its  purpose,  and  valid  as  the 
basis  of  the  contract.  The  questions  propounded  therein 
are  those  upon  which  information  is  desired.  These  are 
often  very  numerous,  and  not  unfrequently  quite  general  and 
indefinite,  and  susceptible  of  being  answered  briefly  and 
substantially,  or  with  greater  or  less  minuteness  of  detail. 
How  briefly,  and  with  what  degree  of  minuteness,  the  appli- 
cant may  not  know.  The  agent  must  be  presumed  to  be 
clothed  with  the  power  to  say  when  the  question  is  satisfac- 
torily answered,  that  is,  with  sufficient  fulness.  Or  in  an- 
swering some  of  the  questions  it  may  not  be  easy  to  state 
exactly  what  the  true  answer  is  upon  the  facts.  Viewed  in 
different  lights,  or  from  different  stand-points,  the  same 
question  upon  the  given  facts  may  admit  of  different  an- 
swers. Cannot  the  agent  say  for  the  company  from  which 
stand-point  they  shall  be  regarded,  and,  having  become  pos- 
sessed of  all  the  facts,  may  he  not  say  which  answer  ought 
to  be  given  ?  Is  the  building  to  be  insured  a  shop  or  a 
store  ?  All  the  facts  being  made  known,  and  the  answer 
being  a  matter  of  doubt,  may  not  the  agent,  instead  of  in- 
cumbering the  papers  with  a  multitude  of  details,  agree  for 
the  company  that  it  is  either,  according  as  he  thinks  the 
facts  show  it  to  be  ?  His  experience  ought  to  enable  him  to 
judge  of  the  true  answer,  and  whether  the  details  ought  to 
be  set  out,  better  than  the  applicant,  who  wishes  only  to  an- 
swer truly,  and  is  indifferent  as  to  which  answer  shall  be 

1  [See  end  of  §  144  G.] 
222 


CH.  VII.]  AGENTS.  —  THEIR   POWEES   AND   DUTIES.  [§1-0 

given.  May  he  not  without  risk  accede  to  that  answer 
which  the  agent  assures  him  will  be  the  more  proper  and 
satisfactory  ?  There  must  be,  it  would  seem,  an  incidental 
power  lodged  in  the  agent,  adequate  to  the  explanation  of 
the  proper  description  of  the  property  or  interest  to  be  in- 
sured, the  meaning  of  the  words  and  phrases  used  in  the 
questions,  and  the  application  of  answers  to  the  subject- 
matter,  so  far  as  they  may  be  necessary  to  perfect  the  in- 
strument and  render  it  fit  for  its  purpose,  and  promote  the 
usefulness  and  efficiency  of  the  agency.  In  short,  the  agent 
may  do  in  this  behalf  what  could  be  done  at  the  home  office, 
if  the  application  were  filled  up  there  upon  conference  with 
the  officers;  and  that  the  agent  may  have  answered  some 
questions  differently  from  what  they  would  have  been  an- 
swered there,  does  not  make  his  act  the  less  binding  upon 
the  company.  The  fair  inference  from  the  fact  of  appoint- 
ment is,  that  the  agent  is  a  suitable  person  and  conversant 
with  his  business.  The  applicant  naturally  and  rightfully 
so  looks  upon  him.  It  cannot  be  supposed  that  he  is  so 
restricted  and  tied  down  as  to  destroy  his  usefulness  to  the 
company;  and  yet  if  agents  so  appointed  are  not  to  be  al- 
lowed to  say  a  word  by  way  of  information  or  explanation, 
when  fairly  and  honestly  attending  to  their  appropriate  busi- 
ness, which  shall  attach  to  the  contract  and  bind  the  com- 
pany, it  is  easy  to  see  that  dealing  with  an  agent  can  be 
neither  satisfactory  nor  safe ;  and  insurance  companies  would 
at  once  find  their  business  confined  to  the  limited  sphere  of 
negotiations  with  those  only  to  whom  the  home  office  is 
accessible,  —  a  result  which,  it  is  fair  to  assume  from  their 
history  and  mode  of  doing  business,  they  by  no  means 
desire.^ 

It  is,  moreover,  always  worth  while  in  considering  the 
question  of  the  extent  of  the  authority  of  an  agent  to  look  to 
his  relations  to  the  company  in  point  of  place.  If  he  is 
remote   from   his   principal,   and  so  situated  that  were  he 

1  Malleable  Iron  Works  v.  Phoenix  Ins.  Co.,  25  Conn.  46.5  ;  Insurance  Co.  v. 
Colt,  20  Wall.  (U.  S.)  560,  567;  Spring  Garden  Mut.  lus.  Co.  v.  Scott,  Leg.  Int. 
March,  1870. 

223 


§122]         insuuance:  fire,  life,  accident,  etc.        [ch.  yii. 

obliged  to  refer  questions  of  doubt  which  arise  within  the 
general  scope  of  the  duties  to  which  he  is  appointed,  his  use- 
fulness and  efficiency  would  be  materially  impaired  by  the 
consequent  delay ;  it  is  fair  to  presume  that  a  more  liberal 
exercise  of  discretion  is  permissible  to  him  than  to  an  agent 
having  the  same  general  powers,  but  residing  so  near  to  his 
principal  that  reference  may  be  practicable  and  consistent 
with  the  success  of  the  agency.  ^ 

§  121.  Authority  as  to  Premiums.  —  And,  in  the  third 
place,  what  is  the  extent  of  the  authority  of  such  agents  in 
the  matter  of  the  receipt  of  premiums,  whether  in  money  or 
in  notes,  &c. ;  and,  in  general,  in  binding  the  company  by 
terms  and  conditions  not  known  to  them,  except  construc- 
tively, and  by  waiving  terms  and  conditions  stated  in  the 
policy,  and  subject  to  which  alone,  as  a  general  rule,  they 
are  willing  to  assume,  and  do  assume,  the  responsibilities 
of  the  contract. 

With  these  few  general  observations,  designed  to  direct 
attention  to  the  various  questions  likely  to  arise,  and  per- 
haps to  indicate  to  some  extent  what  is  conceived  to  be  the 
spirit  and  drift  of  the  law,  we  shall  now  proceed  to  call 
attention  to  the  several  causes  which  may  serve  to  illustrate 
these  suggestions. 

§  122.  Agent  of  Insured.  —  The  agent  of  the  insured  to 
effect  insurance  is  to  all  intents  and  purposes  regarded  in 
the  same  light  as  the  principal,  and  whatever  he  does  per- 
taining to  the  matter  in  his  charge  will  be  deemed  the  act 
of  his  constituent.  His  concealment  or  his  representation, 
even  of  a  fact  not  known  to  his  principal,  is  imputable  to 
the  latter; 2  so  that  when  a  negligent  or  fraudulent  agent  of 

1  Insurance  Co.  v.  Wilkinson,  13  "Wall.  (U.  S. )  222  ;  Eames  v.  Home  Ins.  Co., 
94  U.  S.  621. 

2  [It  is  not  true  as  a  universal  rule  that  knowledge  of  an  agent  is  knowledge 
of  the  principal.  The  master  of  a  vessel  may  know  of  its  loss,  while  the  owner 
in  a  distant  land  is  insuring  it,  but  the  policy  is  not  thereby  affected,  even  though 
the  master  had  had  time  enough  to  communicate  the  loss,  but  refrained  on  pur- 
pose. So  the  knowledge  of  the  owner  himself  on  board  will  not  affect  a  policy 
taken  out  by  his  agent  at  home,  if  the  owner  could  not  communicate  in  time  to 
save  the  company.  Genl.  Interest  Ins.  Co.  v.  Ruggles,  12  Wheat.  411-412. 
Where  brokers  employed  to  insure  an  overdue  vessel,  receiving  word  that  it  was 

224 


CH.  VII.]         AGENTS.  —  THEIR    POWERS    AND    DUTIES.  [§  122 

one  who  applies  for  insurance  intervenes  between  him  and 
an  innocent  insurer,  the  party  who  employs  the  agent  must 
bear  the  consequences  of  the  neglect  or  fraud,  upon  the  prin- 
ciple, so  familiar  in  all  courts  of  justice,  that  when  one  of 
two  innocent  persons  must  suffer  by  the  fraud  or  negligence 
or  unauthorized  act  of  a  third,  he  who  clothed  the  third  with 
power  to  deceive  or  injure  must  be  the  one.  If  either  party 
must  suffer  by  the  act  of  the  agent,  it  must  be  the  party 
whose  agent  he  is.^  The  rule  seems  to  be  less  strict  in 
cases  of  other  contracts.^  ["When  the  insurer  in  issuing  a 
policy  deals  with  a  party  who  remains  in  possession  of  the 
instrument  after  execution,  and  is  alone  entitled  to  recover 
the  amount  thereof,  in  case  of  loss,  he  is  authorized  to  as- 
sume that  such  party  has  power  to  consent  to  such  changes 
in  it  before  breach  as  will  inure  to  the  benefit  of  the  in- 
sured, and  tend  to  perfect  the  validity  of  the  contract. "^ 
When  A.,  who  has  received  money  on  a  policy,  is  sued  by 
C,  who  claims  to  be  the  owner  of  the  property  that  was  in- 
sured, it  is  competent  for  him  to  prove  that  he  was  the  agent 
of  another  who  had  an  insurable  interest  in  the  subject- 
matter,  though  he  had  none  himself.^  Where  the  same  per- 
son is  at  once  agent  for  the  policy-holder  and  the  company, 
the  former  is  bound  by  a  notice  to  the  agent  of  the  cancella- 
tion of  his  policy.^] 

lost,  discontinued  their  negotiations  and  put  the  company  into  direct  communi- 
cation with  the  owners,  who  insured  in  that  company,  and  also  in  another  through 
other  brokers,  the  knowledge  of  the  brokers  affected  the  owners  as  to  the  first 
company,  for  the  negotiations  were  really  all  one,  but  did  not  affect  them  as  to 
the  other  company.  Blackburn  v.  Vigors,  12  App.  Cas.  531  ;  Blackburn  v.  Has- 
1am,  21  Q.  B.  D.  144.  Knowledge  of  the  loss  of  the  subject-matter  of  the  insur- 
ance, before  the  issuance  of  the  policy,  by  one  who  is  not  an  agent  of  the  assured 
for  any  purpose  connected  with  procuring  the  insurance,  will  not  affect  the  in- 
sured.    Clement  v.  Phojnix  Ins.  Co.,  6  Blatch.  481,  485.] 

1  Fitzherbert  v.  Mather,  1  T.  R.  12  ;  ISTicoU  v.  American  Ins.  Co. ,  3  "W.  &  M. 
(U.  S.  C.  C.)  529  ;  Carpenter  v.  American  Ins.  Co.,  1  Story  (U.  S.  C.  C),  57  ; 
Smith  V.  Empire  Ins.  Co.,  25  Barb.  (N.  Y.)  497  ;  Gladstone  v.  King,  1  M.  &  S. 
35  ;  Lynch  v.  Dunsford,  14  East,  494 ;  Draper  v.  Charter  Oak  Ins.  Co.,  2  Allen 
(Mass.),  569. 

2  Cornfoot  v.  Fowke,  6  Mees.  &  Wels.  358  ;  Lord  Abinger,  however,  dissent- 
ing, in  a  very  able  opinion. 

3  [Martin  v.  Tradesmen's  Ins.  Co.,  101  N.  Y.  502.] 
*  [Newson  v.  Douglass,  7  H.  &  J.  (Md.)  417,  449.] 

5  [Hartford  Fire  Ins.  Co.  v.  Eeynolds,  36  Mich.  502,  507.] 

VOL.  I. —  15  225 


§  123  insurance:  fire,  life,  accident/  etc.      [ch.  vii. 

[8  122  A.  Ratification  by  the  Assured.  One  may  insure 
in  his  own  name  the  property  of  another  without  his  prer 
vious  authority,  and  it  will  inure  to  the  party  intended  to  be 
insured  or  protected,  upon  his  subsequent  adoption  of  it, 
even  after  a  loss  has  occurred.^  An  insurance  effected  for 
the  benefit  of  a  third  person,  although  without  his  authority 
or  sanction,  may  be  adopted  by  the  cestui  que  insurance,^ 
even  after  the  loss,  if  within  a  reasonable  time,^  or  after 
payment  of  proceeds.*  One  of  five  trustees  can  insure  the 
trust  property,  and  the  others  may  subsequently  ratify  the 
contract.^  The  ratification  of  an  act  of  agency  to  be  bind- 
ing must  be  with  full  knowledge  of  all  material  facts. ^  The 
acceptance  by  the  assured  of  a  policy,  with  the  intent  of 
holding  it  as  binding  on  the  company,  binds  him  according 
to  the  terms  expressed,  and  he  cannot  be  permitted  to  plead 
ignorance  of  them.'^] 

§  123.  Referees  ;  Medical  Examiners  ;  Broker.  —  Persons  re- 
ferred to  for  information  are  agents  only  to  a  limited  extent. 
They  are  authorized  in  behalf  of  their  principal  to  answer 
interrogatories,  whether  verbal  or  written,  so  far  as  it  is 
agreed  that  they  shall  be  questioned,  and  the  principal  is 
responsible  if  such  referee  does  not  answer  correctly,  but  the 
referee  is  not  authorized  to  volunteer  information  not  asked 
for;  and  if  he  does  this  the  principal  is  not  responsible.^ 

Reference  to  the  surgeon's  report  for  answers  to  interroga- 
tories about  the  health  of  the  applicant  converts  the  report 

1  [Miltenberger  v.  Beacom,  9  Pa.  St.  198,  200.] 

2  [Durand  v.  Thouron,  1  Porter  (Ala.),  238,  247.] 
8  [Watkins  v.  Durand,  1  id.  251,  254.] 

*  [Snow  V.  Carr,  61  Ala.  363,  370.] 

6  [Insurance  Co.  v.  Chase,  5  Wall.  509,  514.  J 

6  [Owings  V.  Hull,  9  Pet.  607,  629.] 

''  [Monitor  Ins.  Co.  v.  Buffum,  115  Mass.  343,  345.  In  this  case  there  was  a 
recital  in  the  policy  that  the  agent  of  the  insured  had  given  a  deposit  note,  and 
it  was  held  that  acceptance  of  the  policy  was  a  ratification  of  the  agent's  act  iu 
giving  the  note,  although  the  insured  was  in  fact  ignorant  of  it.] 

•*  Swete  V.  Fairlie,  6  C.  &  P.  1,  per  Ld.  Denman,  C.  J.  ;  Huckman  v.  Fernie, 
3  M.  &  "W.  505  ;  Rawlins  v.  Desborough,  2  M.  &  Rob.  328;  Everett  v.  Desbor- 
ough,  5  Bing.  503  ;  Maynard  v.  Rhode,  1  C.  &  P.  360  ;  Rose  v.  Star  Ins.  Co.,  3 
Bigelow  Life  &  Ace.  Ins.  Gas.  346.  See  also  Rawls  v.  American  Mut.  Life  Ins. 
Co.,  27  N.  Y.  282,  294. 
226 


CH.  VII.]  AGENTS. — THEIE   POWEKS   AND    DUTIES.  [§  123 

into  answers  as  if  by  the  applicant,  and  any  misrepresenta- 
tion or  concealment  there  is  as  fatal  as,  if  by  the  applicant 
personally.^  It  behooves,  however,  all  referees,  so  far  as 
authorized,  to  answer  carefully  all  such  general  questions,  — ■ 
as,  for  instance,  whether  there  are  any  other  circumstances 
which  would  affect  the  risk,  or  are  important  for  the  com- 
pany to  know,  —  as  may  be  put  to  them ;  and  if  the  person 
interrogated  is  in  doubt  whether  a  particular  fact  known  to 
him  is  material  or  important,  it  is  safest  to  communicate  it, 
as  his  principal  will  be  responsible  for  whatever,  in  fact, 
may  be  found  by  the  jury  to  be  material,  without  regard  to 
his  judgment  npon  that  point. ^  But  in  Wheeltdn  v.  Hard- 
isty^  it  was  held  that,  when  the  policy  contains  no  express 
condition  that  the  insured  shall  be  held  responsible  for  the 
misrepresentations  or  concealments  of  the  "  life "  or  the 
referee,  and  is  made  on  a  declaration  that  the  insured  be- 
lieves the  statements  of  the  "  life "  and  the  referee  to  be 
true,  they  are  not  his  agents,  and  he  is  only  responsible  for 
the  truth  of  his  statement  as  to  his  belief,  and  not  for  their 
fraudulent  misstatements.  If  he  expressly  stipulate  for  their 
truth,  however,  the  assured  is  bound  by  the  statements  of  the 
"life."*  When  the  applicant  is  referred  by  the  insurers  to 
their  medical  examiner,  it  is  that  he  may  examine  and  report 
as  to  the  life.  His  duty  as  medical  examiner  does  not  carry 
with  it  authority  to  advise  the  applicant  how  he  should  fill 
up  his  application, so  as  to  bind  the  company.^  But  a  broker 
employed  to  effect  a  policy  of  insurance,  or  to  procure  its 
modification,  must  be  regarded  as  the  agent  of  the  party  who 
employs  him,  and  his  acts  in  that  behalf  bind  his  principal.^ 

1  Smith  V.  ^tna  Life  Ins.  Co.,  49  N.  Y.  211.     See  also  post,  §  214. 

2  Lindenau  v.  Desborough,  8  B.  &  C.  586  ;  s.  c.  3  M.  &  R.  45.  But  see  ■post, 
§§  201-203. 

3  8  E.  &  B.  232.  This  case  contains  a  very  careful  examination  of  the  prior 
cases  by  both  court  and  counsel,  which  it  will  be  well  to  refer  to.  Mutual  Life 
Ins.  Co.  V.  Wager,  27  Barb.  (N.  Y.)  354. 

*  Forbes  v.  Edinburgh  Life  Assurance  Co.,  10  Ct.  of  Sess.  Cas.,  First  Series, 
451. 

s  Flynn  v.  Equitable  Life  Ass.  Soc,  67  N.  Y.  500,  reversing  s.  c.  7  Hun 
(N.  Y.),  387. 

6  Standard  Oil  Co.  v.  Triumph  Ins.  Co.,  N.  Y.,  5  Ins.  L.  J.  594:  Union 
Ins.  Co.  V.  Chipp,  93  111.  96  ;  Continental  Life  Ins.  Co.  v.  Goodall,  Cin.  Superior 

227 


§  124  A]     insurance:  fire,  life,  accident,  etc.      [ch.  vii. 

§  124.  Duty  of  the  Agent  of  the  Insured.  —  An  agent  hav- 
ing general  authority  to  insure  the  property  of  his  principal 
has  no  authority  to  effect  an  insurance  in  a  mutual  company 
whereby  he  makes  his  principal  an  insurer  of  others. ^  The 
agent  employed  to  effect  insurance,  it  scarcely  need  be  said, 
is  responsible  to  his  principal  for  every  negligence  in  the 
performance  of  his  duties.  That  the  undertaking  was  gratu- 
itous is  no  defence,  if  it  was  actually  entered  upon;^  though 
perhaps  the  breach  of  a  mere  gratuitous  promise  to  under- 
take would  not  be  actionable.  So  is  he  for  neglect  to  make 
reasonable  efforts  to  insure  when  it  is  his  duty  to  obtain 
insurance  if  he  can ;  ^  and  effecting  insurance  with  irrespon- 
sible parties  has  been  held  to  be  negligence.^  The  measure 
of  damages  in  such  case  is  the  amount  which  the  irrespon- 
sible insurers  ought  to  have  paid.^ 

[§  124  A.  "Whose  Agent?  (Agent  of  Company.')  —  Where 
A.  goes  to  B.  to  get  insurance,  and  B.,  not  being  able  to 
place  the  whole  amount  in  the  companies  he  represents,  goes 
to  another  insurance  agent,  C,  B.  is  not  the  agent  of  the 
assured  in  this  negotiation,  without  his  knowledge,  so  as  to 
avoid  the  policy  by  his  false  statements.*^  But  when  the 
assured  filled  out  an  application  in  Company  A.,  and  gave 
it  to  A.^s  agent  to  procure  insurance  in  "any  good  company," 
and  the  agent  procured  the  same  in  Company  B.,  it  was 
held  that  he  was  in  this  transaction  the  assured's  agent 
solely. '^  The  insurance  agent  cannot  be  considered  in  any 
sense  as  the  agent  of  the  insured  in  anything  connected  with 
issuing  the  policy.^  A  clause  in  the  policy  declaring  that 
the  company  will  not  be  bound  by  the  act  of  any  agent,  does 
not  overcome  the  law  which  holds  the  company  for  the  acts 

Ct.,  5  Big.  Life  &  Ace.  Ins.  Cas.  422  ;  Marland  v.  Eoyal  Ins.  Co.,  71  Pa.  St. 
393. 

1  White  V.  Madison,  26  N.  Y.  117. 

2  Wallace  v.  Tellfair,  2  T.  R.  188,  n. ;  Wilkinson  v.  Coverdale,  1  Esp.  75. 

3  Smith  V.  Lascelles,  2  T.  R.  187  ;  Smith  v.  Cologan,  2  T.  R.  188,  n.  (a). 
*  Hurrell  v.  Bullard,  3  F.  &  F.  445. 

6  Smith  V.  Price,  2  F.  &  F.  748. 
6  [McGraw  v.  Germania  Fire  Ins.  Co.,  54  Mich.  146.] 
■^  [Fame  Ins.  Co.  v.  Mann,  4  111.  App.  485,  492.] 
8  [Commercial  Fire  Ins.  Co.  v.  Allen,  80  Ala.  571.] 

228 


CH.  VII.]         AGENTS.  —  THEIR   POWERS   AND   DUTIES.  [§  125 

of  agents  within  the  scope  of  their  anthority.^(a)  The  facts 
of  the  case  must  determine  for  whom  the  person  was  acting. ^ 
In  Iowa  it  is  provided  by  statute  that  one  soliciting  insur- 
ance or  procuring  applications  shall  be  deemed  the  agent  of 
the  company,  no  matter  what  the  policy  or  application  may 
say  to  the  contrary,  wherefore  no  agreement  can  convert  him 
into  the  agent  of  the  assured.^ 

(^Agent  of  Insured.')  —  A  broker  who  solicits  insurance,  and 
then  procures  a  policy  to  be  issued  by  the  insurer,  is  not  the 
agent  of  the  company  merely  by  such  facts.*  Where  A. 
obtains  a  policy  through  a  broker  B.,  who  acts  through  other 
brokers,  finally  in  the  chain  coming  to  an  insurance  agent, 
B.  is  the  agent  of  A.,  and  payment  of  the  premium  to  him 
or  to  any  of  the  line,  except  the  insurance  agent,  is  not  pay- 
ment to  the  company.^  An  insurance  agent  agreed  with  A. 
to  look  after  his  risks  in  the  company  he  represented,  and 
in  others,  and  reported  lists  to  him  showing  the  amount  of 
his  insurances  therein,  and  giving  him  a  receipt  for  money 
advanced  to  pay  premiums.  These  lists  were  held  inadmis- 
sible in  an  action  by  A.  against  the  agent's  company,  to 
show  any  recognition  of  the  policy.^] 

§  125.  Agent  must  be  disinterested.  —  It  is,  of  course, 
elementary  law  that  an  agent  must  not  be  personally  inter- 
ested adversely  to  his  principal,  so  that  an  agent  for  receiv- 

^  [Insurance  Co.  v.  Lee,  73  Tex.  641.] 

2  [Smith  V.  Home  Ins.  Co.,  47  Hun,  30,  37  ;  Deitz  v.  Ins.  Co.,  31  \V.  Va. 
851  ;  Pierce  y.  The  People,  106  111.  11  ;  North  liritish,  &c.  Ins.  Co.  j;.  Crutchfield, 
108  Ind.  518  ;  Sullivan  v.  Phenix  Ins.  Co.,  34  Kans.  170;  Kansal  v.  Minn.,  &c. 
Fire  Ass.,  31  Minn.  17.  In  Atlantic  Ins.  Co.  v.  Carlin,  58  Md.  336,  the  facts 
were  held  to  bring  the  case  within  the  true  scope  of  the  clause,  and  one  who  re- 
ceived an  application  for  renewal  and  remitted  the  premium,  was  held  the  agent 
of  the  insured.  Insurance  Co.  v.  Cusick,  109  Pa.  St.  157;  Nassauerw.  Insurance 
Co.,  id.  507.] 

8  [Continental  Life  Ins.  Co.  v.  Chamberlain,  132  U.  S.  304 ;  see  infra, 
§  125,  n.  (b)  adjiiiem.] 

*  [Kings  Co.  Fire  Ins.  Co.  v.  Swigert,  11  Brad.  590.] 

°  [Pottsville  Mat.  Fire  Ins.  Co.  v.  Minnequa  Springs  Imp_.  Co.,  100  Pa.  St.  137.] 

6  [Hartford  Fire  Ins.  Co,  v.  Reynolds,  36  Mich.  502,  506.] 

(a)  As  to  the  eflect  of  the  agency     the  insured,  see  Knights  of  Pythias  w. 
clause  in  the  policy,  making  the  person     Withers,  177  U.  S.  260. 
negotiating  the  insurance,  the  agent  of 

229 


§  125]  INSURANCE  :   FIRE,   LIFE,  ACCIDENT,   ETC.         [CH.  VII. 

inc  applications  ceases  to  be  an  agent  so  long  as  he  acts  in 
a  matter  in  which  his  personal  interest  is  concerned.  If  he 
applies  for  insurance  on  his  own  property,  as  to  that  prop- 
erty he  is  no  agent  of  the  company,  (a)  He  cannot,  by  the 
familiar  rule  of  law,  as  agent,  represent  antagonistic  inter- 
ests.^ He  cannot  be  the  agent  of  both  parties  in  the  same 
transaction.  If  he  so  act,  the  contract  may  be  avoided  by 
either  party.  ^  (6)     It  may  happen  that  during  the  negotia- 

1  Bentley  v.  Columbia  Ins.  Co.,  17  N.  Y.  421,  affirming  s.  c.  19  Barb.  (N.  Y.) 
595  ;  New  York  Central  Ins.  Co.  v.  National  Protection  Ins.  Co.,  4  Kern.  (N.  Y.) 
85,  reversing  s.  c.  20  Barb.  (N.  Y.)  468  ;  Utica  Ins.  Co.  v.  Toledo  Ins.  Co.,  17 
Barb.  (N.  Y.)  132.  [An  agent  making  an  application  on  his  own  property, 
directly  or  indirectly,  for  his  own  benefit  is  acting  for  himself,  and  is  not  the 
agent  of  the  company  in  the  transaction.  Spare  v.  Home  Mut.  Ins.  Co.,  19  Fed. 
Rep.  14  (Or.),  1884.  He  cannot  effect  insurance  in  his  company  on  property  of 
which  he  is  part  owner,  without  the  knowledge  of  the  company,  even  though  it 
could  be  shown  that  his  relation  thereto  was  not  material  to  the  risk.  The 
ground  of  the  rule  is  public  policy.  Ritt  v.  Washington  Mut.  &  Fire  Ins.  Co., 
41  Barb.  353,  357.  An  agent  cannot  bind  his  principal  in  a  contract  with  him- 
self. A  parol  contract  between  A.  and  B.  for  the  renewal  of  a  policy  on  partner- 
ship property  of  A.  and  B.,  A.  being  agent  of  the  company,  must  be  approved  by 
the  insurer,  before  it  will  bind  him.  Glens  Falls  Ins.  Co.  v.  Hopkins,  16  Brad. 
220.  The  secretary  of  a  company  cannot  issue  insurance  to  himself,  and  such  a 
contract  will  not  be  rendered  valid  by  constructive  notice  to  the  company  by 
reason  of  its  being  placed  upon  the  files.  Actual  knowledge  of  the  facts  is 
necessary  to  its  ratification.  Pratt  v.  Dwelling-House  Mut.  Fire  Ins.  Co.,  53 
Hun,  101.] 

2  Ibid.  [The  law  will  not  allow  a  person  to  act  as  agent  for  both  insurer  and 
insured,  and  if  he  does  so  act  either  party  may  avoid  the  contract.  People's  Ins. 
Co.  V.  Paddon,  8  Brad.  447.] 

{a)  See  infra,  §  137,  and  note.  an  agent,   not   being    limited    in    his 

(b)    An  insurance  agent  cannot  act  as  authority,  undertakes  to  prepare  appli- 

agent  for  both  the  insurer  and  the  in-  cations  and  take  down  answers,  he  is 

sured  without  the  former's  knowledge  deemed  to  be  acting   for   the   insurer, 

and  consent,  when  such  double  agency  New   York    Life  Ins'.   Co.  v.  Fletcher, 

will  give  rise  to  any  conflict  of  duties ;  117  U.  S.  519,  531  ;  U".  S.  Life  Ins.  Co. 

and  he  is  not  individually  liable  upon  v.    Smith,    92    Fed.    Rep.     503,    508 ; 

his  contract  "as  agent,"  to  keep  prop-  supra,  §  124  A  ;  Com'th   Mut.    F.  Ins. 

erty  insured  in  his  company.   Ramspeck  Co.  v.  Knabe  Co.,  171  Mass.  265.     As 

V.  Pattillo,  104  Ga.  772  ;   see  Teutonia  stated  infni,  §  500,  it  is  often  a  question 

Ins.  Co.  V.  Ewing,  90   Cal.  217.     Such  of  fact,  or  one  of  mixed  fact  and  law,  for 

an  agent,  when  directed  to  cancel,  or  to  the  jury  as  to  each  act  in  a  negotiation 

reinsure   part   of  a   risk,   cannot,  in  a  whether  the  agent  is  acting  for  the  Oora- 

matter   thus   involving  discretion,    act  pany  or  for  the  insured.     See  West  field 

for  both  companies  as  to  the  reinsurance.  Cigar  Co.  v.  Ins.  Cos.,  169  Mass.  382; 

Empire   State  Ins.  Co.  v.  Am.  Central  Firemen's   Ins.  Co.  v.  Horton,  170   111. 

Ins.  Co.,  138  N.  Y.  446.     When  such  258;    Lumbermen's   Mut.   Ins.   Co.  v. 

230 


CH.  VII.]         AGENTS.  —  THEIR   POWERS   AND   DUTIES.  [§  126 

tiuiis,  the  agent  of  the  insurers  in  certain  particulars  may, 
in  certain  other  particulars,  be  empowered  by  the  insured  to 
act  for  him,  so  that  the  same  person  becomes  now  the  agent 
of  one  and  now  the  agent  of  the  other  contracting  party. ^ 

§  126.  Agent's  Authority,  what  it  appears  to  be.  —  The 
authority  of  an  agent  must  be  determined  by  the  nature  of 
his  business,  and  is  prima  facie  co-extensive  with  its  re- 
quirements.2  [An  agent  authorized  to  issue  policies  binds 
the  company  by  all  waivers,  representations,  or  other  acts 
within  the  scope  of  his  business  unless  the  insured  has 
notice  of  a  limitation  of  his  powers. ^  The  question  always 
is,  not  what  power  the  agent  did  in  fact  possess,  but  what 
power  the  company  held  him  out  to  the  public  as  pos- 
sessing.^]    His  power  cannot  be  limited  by  special  private 

1  See  vost,  §  500. 

2  Post,  §  144  ;  Imperial  Fire  Ins.  Co.  v.  Murray,  73  Pa.  St.  13  ;  "Wass  v.  Maine 
Mut.  Mar.  Ins.  Co.,  61  Me.  537;  Lycoming  Ins.  Co.  v.  Woodworth,  83  Pa.  St. 
^iZ  ;  Mentz  v.  Lancaster  Fire  Ins.  Co.,  79  Pa.  St.  475  ;  Putnam  v.  Home  Ins. 
Co.,  123  Mass.  324  ;  Dayton  Ins.  Co.  v.  Kelly,  24  Ohio  St.  345. 

3  [Ins.  Co.  V.  Barnes,  41  Kans.  161  (agent  misstated  title  in  the  application, 
being  informed  of  the  facts)  ;  Insurance  Co.  v.  Hogue,  41  Kans.  524  (renewal  in 
unauthorized  manner)  ;  Phanix  Ins.  Co.  v.  Spiers,  87  Ky.  286.] 

•       1  [Eclectic  Life  Ins.  Co.  v.  Fahrenkrug,  68  111.  463,  467.] 

Bell,  166  111.  400.     When  an  insurance  Cooper,    6    Col.    App.    25 ;    Buick   v. 

broker  solicits  or  is  applied  to  for  insur-  Mechanics'    Ins.    Co.,    103   Mich.    75; 

ance,  he  acts  as  the  applicant's   agent  British  Ins.  Co.  v.  Lambert,  26  Oregon, 

in  selecting  the  insurers,  his  authority  198 ;  Sellers  v.  Commercial  F.  Ins.  Co., 

ceasing  when   the   policy  is  obtained ;  105  Ala.    282  ;    McGoiiigle  v.  Susque- 

and  if  asked  bythe  insured  to  obtain  a  hanna  Mut.  F.  Ins.  Co.,  168  Penn.  St. 

renewal,  and  the  insurer  sends  him  a  1  ;  Fromherz  v.   Yankton  F.  Ins.  Co., 

renewal  receipt,  expecting  him  to  col-  7  So.  Dak.   187 ;    Kansas   Fanners'  F. 

lect  the  premium  on  its  delivery  to  the  Ins.   Co.   v.   Saindon,  52   Kansas,  486  ; 

insured,  the  premium  is  paid  when  the  Davis  v.  ^tna  Mut.  F.  Ins.  Co.,  67  N. 

insured  pays  it  to  him,  though  the  in-  H.    335.      Upon   the   Iowa   statute   of 

surer  never  receives  it.    Ibid.  ;  American  March    31,    1880,    making    those   who 

Fire  Ins.    Co.  v.  Brooks,    83    Md.   22 ;  solicit  or  procure  insurance  the  solicit- 

Michigan  Pipe  Co.  v.  Michigan  F.  &  M.  ing  agent  of  the  company  which  issues 

Co.,  92  Mich.    482  ;    20   L.  R.  A.  277,  a    policy    on    such    application,    or    a 

and     note  ;     Improved-Match     Co.    v.  renewal  thereof,  anything  in  the  appli- 

Michigan   Mut.    F.    Ins.    Co.    (Mich.),  cation  or  policy  to  the   contrary  not- 

80  N.  W.  1088;  Croft  v.  Hanover  F.  withstanding,    see  Continental    L.  Ins. 

Ins.  Co.,   40  W.    Va.  .508  ;    Goldin    v.  Co.  v.  Chamberlain,  132  U.  S.  304,  309  ; 

Northern  Ass.  Co.,  46  Minn.  471  ;  East  Schoep  v.  Bankers'  Alliance  Ins.   Co., 

Texas  F.   Ins.  Co,  v.  Blum,  76  Texas,  104    Iowa,     354.      In    Wisconsin,    see 

653  ;    Phoenix   Ins.   v.   Spiers,   87    Ky.  Stehlick  v.  Milwaukee  Mechanics'  Ins. 

285,  297  ;  British  America  Ass.  Co,  v.  Co,,  87  Wis.  322. 

231 


§  126] 


insurance:     fire,   life,   accident,   etc.         [CH.  VII. 


instructions,  unless  the  insured  has  notice,  or  there  is 
something  in  the  nature  of  the  business,  or  the  circum- 
stances of  the  case,  to  indicate  that  the  agent  is  acting 
under  such   special   instructions.  ^  (a)      A  provision  in  the 

1  United  States  Life  Ins.  Co.  v.  Advance  Co.,  80  111.  549  ;  Miller  v.  Phcenix 
Ins.  Co.,  27  Iowa,  203  ^  Southern  Life  Ins.  Co.  v.  McCain,  96  U.  S.  84.  [Secret 
or  unknown  instructions  <lo  not  affect  a  person  dealing  with  an  agent  within 
the  apparent  scope  of  his  authority.  Rivara  v.  Queen's  Ins.  Co.,  62  Miss.  720 ; 
Commercial  Union  Ass.  Co.  v.  State,  113  Ind.  331  ;  Ruggles  v.  Am.  Cent.  Ins. 
Co.,  114  N.  Y.  415,  421,  1889  ;  Breckinridge  v.  Amer.  Cent.  Ins.  Co.,  87  Mo.  62. 
Instructions  to  the  agent  not  communicated  to  the  insured  do  not  affect  him. 
Queen  Ins.  Co.  v.  Yount,  86  Ala.  424.] 


(a)  A  limitation  upon  the  authority 
of  an  agent  of  an  insurance  compan)', 
by  private  instructions  given  to  him  by 
the  officers  of  the  company,  cannot  bind 
a  person  with  whom  he  makes  an  oral 
contract  of  insurance,  if  such  person  has 
no  knowledge  of  the  limitation.  Brown 
r.  Franklin  ilutual  Fire  Ins.  Co.,  165 
Mass.  565.  See  Parker  &  Young  Manuf. 
Co.  V.  Exchange  F.  Ins.  Co.,  166  Mass. 
484. 

The  authority  of  the  agent  to  make 
the  contract  of  insurance  enables  him, 
without  the  aid  of  the  courts,  to  coirect 
a  policy  by  inserting  afterwards  property 
intended  to  be  included,  but  omitted  by 
mistake:  Taylor  v.  State  Ins.  Co.,  98 
Iowa,  521  ;  or  to  assent  to  an  assign- 
ment of  the  policy  to  cover  a  mortgage. 
Herman  Ins.  Co.  v.  Penrod,  35  Neb. 
273.  With  respect  to  waiver  of  the 
breach  of  a  condition  in  a  policy  the 
most  liberal  view  is  that  the  agent's 
authority  is  co-extensive  with  the  busi- 
ness intrusted  to  his  care.  Weed  v. 
London  &  L  F.Ins.  Co.,  116  N.  Y.  106  ; 
German  Ins.  Co.  v.  Gray,  43  Kans. 
497.  If  the  agent  is  empowered  to  pre- 
pare, receive,  and  transmit  applications, 
and  to  receive  payment  of  the  premium, 
his  knowledge  acquired  in  so  doing,  and 
his  representations  then  made  to  the 
insured,  bind  the  insurer.  Home  F. 
Ins.  Co.  V.  Gurney,  56  Neb.  306  ;  Perry 
V.  Dwelling-House  Ins.  Co.,  67  N.  H. 
291  ;  McDonald  v.  Phila.  F.  Ass'n,  93 
Wis.   348  ;  Met'n  L.  Ins.   Co.  v.  Mul- 

232 


leady  (Ky.),  29  Ins.  L.  J.  164.  But  he 
cannot  insure,  or  waive  policy  stipula- 
tions, so  as  to  bind  the  company,  when 
it  is  clear  that  his  acts  exceed  the  power 
it  has  conferred  upon  him.  Farmers'  & 
M.  Ins.  Co.  V.  Graham,  50  Neb.  818  ; 
Rahr  v.  Manchester  F.  Ass.  Co.,  93 
Wis.  355  ;  Ward  v.  Met'n  L.  Ins.  Co., 
66  Conn.  227 ;  Sawyer  v.  Equitable 
Ace.  Ins.  Co.,  42  Fed.  Rep.  80.  The 
insured  is  bound,  in  the  absence  of  fraud, 
to  know  the  measure  of  an  agent's  au- 
thority. Conway  v.  Phoenix  M.  L.  Ins. 
Co.,  140  N.  Y.  79  ;  Murphy  v.  Royal 
Ins.  Co.  (La. ),  29  Ins.  L.J.  210.  As  to 
an  agent's  power  to  waive  premiums 
and  allow  credit,  see  Smith  v.  New  Eng- 
land Mut.  L.  Ins.  Co.,  63  Fed.  Rep. 
769  ;  Smith  v.  Provident  Sav.  L.  Ass. 
Society,  65  id.  765  ;  Moore  v.  Rockford 
Ins.  Co.,  90  Iowa,  636  ;  Arthurholt  v. 
Susquehanna  Mut.  F.  Ins.  Co.,  159 
Penn.  St.  1  ;  Wilkins  v.  State  Ins.  Co., 
43  Minn.  177.  As  to  the  authority  of 
insurance  agents,  see  also  Paine  v.  Pacific 
M.  L.  Ins.  Co.,  51  Fed.  Rep.  689  ;  Mu- 
tual B.  L.  Ins.  Co.  V.  Robison,  58  id. 
723  ;  Harrison  v.  Hartford  F.  Ins.  Co., 
59  id.  732  ;  Henderson  v.  Travelers'  Ins. 
Co.,  65  id.  438  ;  Potter  v.  Phenix  Ins. 
Co. ,  63  id.  382  ;  Parker  v.  Rochester 
G.  Ins.  Co.,  162  Mass.  479  ;  Porter  v. 
U.  S.  L.  Ins.  Co.,  160  Mass.  183 ;  Baker 
V.  Commercial  U.  Ass.  Co.,  id.  358  ; 
Croft  V.  Hanover  F.  Ins.  Co.,  40  W.  Va. 
508  ;  Commercial  Fire  Ins.  Co.  v.  Mor- 
ris, 105  Ala.  498  ;  Fidelity  &  C.   Ins. 


CH.  VII.]         AGENTS.  —  THEIR   POWERS   AND   DUTIES.  [§  126 

policy  that  agents  are  only  authorized  to  collect  renewal 
premiums  upon  receipts  furnished  and  signed  by  the  presi. 
dent  and  secretary,  is  notice  of  such  limitation  of  the  agents' 
powers.^  So  is  a  provision  in  the  policy  that  they  cannot 
waive  any  of  its  conditions. ^  But  notices  printed  on  the 
back  of  a  policy,  that  payment  to  an  agent  will  not  be  valid 
without  the  production  of  a  receipt,  is  not.^  The  agent's 
act  must  appear  to  be  an  act  in  furtherance  of  the  business 
of  his  principal.  If  he  is  known  to  have  charge  of  a  special 
branch  of  his  principal's  business,  his  powers  can  only  be 
exercised  in  the  prosecution  of  that  branch.  An  agent  to 
make  contracts  has  larger  powers  than  an  agent  to  receive 
applications  to  be  forwarded  to  his  principal.  Stock  com- 
panies have  larger  powers  than  mutual  companies.  So  with 
their  agents.  A  general  agent,*  in  the  strict  legal  sense,  is 
one  who  has  all  the  powers  of  his  principal  as  to  the  busi- 
ness in  which  he  is  engaged,  —  an  extent  of  authority  not 
often  conferred  in  insurance.  In  that  business  an  agent  is 
termed  a  general  agent  rather  with  reference  to  the  geo- 
graphical extent  of  his  authority,  in  contradistinction  to  a 
local  agent,  who  may  have  original  powers,  though  exercising 
them  within  more  restricted  limits  ;  and  the  general  agent  may 
appoint  local  and  sub-agents,  which  a  local  agent  cannot.^  (a) 

i  ilerserau  v.  Phoenix  Mut.  Life  Ins.  Co.,  66  N.  Y.  274 ;  Catoir  v.  Am.  Life 
Ins.,  &c.  Co.,  33  N.  J.  487  ;  post,  §  138. 

a  Greene  v.  Lycoming  Fire  Ins.  Co.  (Pa.),  9  Ins.  L.  J.  811  ;  Clevenger  f.  Mut. 
Life  lus.  Co.  (Dak.),    9  Ins.  L.  J.  129. 

3  McXeilly  v.  Continental  Life  Ins.  Co.,  66  N.  Y.  23. 

*  [An  indorsement  on  the  policies  "  D.  C.  Heminway,  agent,"  there  being  no 
intimation  of  restriction,  entitles  the  insured  to  regard  H.  as  a  general  agent. 
Fire  Ins.  Co.  v.  Building  As.s.,  43  N.  J.  652.  "Where  a  power  is  general,  the 
agent  may  do  anything  to  bind  his  principal  which  is  within  the  scope  of  his 
authority.  But  if  it  be  special,  everything  is  void  if  he  does  not  act  in  strict 
conformity  to  his  authority."     Allen  v.  Ogden,  1  Wash.  174,  176.] 

6  Rossiter  v.  Trafalgar  Ass.  Ass'n,  27  Beav.  377. 

Co.  V.  Teter,  136  Ind.  672  ;  Squire  v.  trout  (Berks  Co.,  Penn.),  21  Ins.  L.  J. 

Hanover  F.  Ins.  Co.,   162  N.  Y.  552  ;  1055. 

Hamm  Realty  Co.  v.  New  Hampshire  («)  A  local  or  special  agent,  who  has 
F.  Ins.  Co.  (Minn.),  83  N.  W.  41.  As  no  actual  authority  to  puter  into  a  con- 
to  the  liability  of  an  insurance  agent  tract  of  insurance,  cannot  delegate  such 
to  his  principal  for  failure  to  obey  in-  a  power  to  a  sub-agent :  Stewart  i-.  Hel- 
btructions,  see  Sun  Fire  Office  v.  Ermen-  vetia    Fire   Ins.    Co.,    102    Cal.    218  • 

233 


§126] 


INSURANCE  :    FIRE,   LIFE,    ACCIDENT,   ETC.  [CH.  VII. 


But  there  seems  to  be  no  very  well  defined  distinction 
between  the  powers  of  general  agents,  local  agents,  and 
sub -agents,  and  therefore  they  may  become,  in  any  case,  a 
question  of  fact  for  the  jury.^  A  general  agent  of  a  for- 
eign company,  appointed  under  a  statute,  to  receive  service 
of  process,  except  as  to  such  matters  as  facilitate  suits 
against  the  principal,  has  no  larger  powers  than  are  con- 
ferred by  the  common  law  of  agency.  ^  Nor  does  such  an 
agency  imply  the  authority  to  intervene  in  the  negotiations 
for  a  policy.* 

A  person  authorized  to  accept   risks,  to  agree  upon  and 

^  ilarkey  v.  Mut.  Benefit  Life  Ins.  Co.,  103  Mass.  78  ;  Kolgers  v.  Guard.  Life 
Ins.  Co.,  10  Abb.  Pr.  R.  N.  s.  176.  [When  an  agency  is  shown,  the  law  does  not 
presume  it  to  be  either  general  or  special ;  that  is  a  question  of  fact  for  the  jury. 
Dickinson  County  v.  Miss.  Valley  Ins.  Co.,  41  Iowa,  286,  290,  1875.] 

2  Ibid. 

3  Whitcomb  v.  Phoenix  Life  Ins.  Co.,  C.  Ct.  (Mass.),  8  Ins.  L.  J.  624.  But 
see  post,  §  151  ;  Queen's  Ins.  Co.  v.  Harris  (Pa.),  5  Ins.  L.  J.  558. 


O'Brien  v.  New  Zealand  Ins.  Co.,  108 
Cal.  227  ;  Home  F.  Ins.  Co.  v.  Garbacz, 
48  Neb.  827  ;  Teutonia  Ins.  Co.  v. 
Howell  (Ky.),  54  S.  W.  852  ;  or  bind 
the  insurer  by  his  conduct,  representa- 
tions, or  admissions.  Ibid.  ;  PhcEnix 
Ins.  Co.  V.  Copeland,  90  Ala.  386.  The 
clerk  of  such  an  agent  cannot  waive  for- 
feitures. German  American  Ins.  Co.  v. 
Humphrey,  62  Ark.  348.  See  Syndicate 
Ins.  Co.  V.  Catchings,  104  Ala.  176  ; 
Harding  v.  Norwich  Union  F.  Ins. 
Society,  10  So.  Dak.  64.  If  a  local  agent 
has  apparent  authority  by  custom,  or 
otherwise,  to  receive  proofs  of  loss,  a  de- 
livery to  him  constitutes  a  delivery  to  the 
company,  even  if  he  had  not  authority 
from  the  nature  of  his  agency  to  receive 
them,  or  if,  in  the  absence  of  custom,  a 
delivery  to  him  under  the  circumstances 
would  not  have  been  a  reasonable  mode 
of  sending  the  proofs  of  loss  to  the  com- 
pany. See  Bishop  v.  Eaton,  161  Mass. 
496,  500  ;  Wheeler  v.  Watertown  Ins. 
Co.,  131  Mass.  1  ;  Harnden  v.  Mil- 
waukee M.  Ins.  Co.,  164  Mass.  382;  Arfif 
V.  Star  Ins.  Co.,  125  N.  Y.  57;  Snyder 
V.  Dwelling-House  Ins.  Co.,  59  N.  J. 
L.  18,  544  ;  Nickell  v.  Phcenix  Ins.  Co., 

234 


144  Mo.  420  ;  Phenix  Ins.  Co.  v.  Ead 
Bila  Hora  Lodge,  41  Neb.  21  ;  Burling- 
ton Ins.  Co.  V.  Kennerly,  60  Ark.  532  ; 
Harrison  v.  Hartford  F.  Ins.  Co.,  59  Fed. 
Rep.  732 ;  Loeb  v.  American  Central 
Ins.  Co.,  99  Mo.  50.  He  may  also 
waive  a  condition  that  the  waiver  of 
proofs  of  loss  be  indorsed.  O'Leary  v. 
German-American  Ins.  Co.,  100  Iowa, 
390.  And  he  may  at  the  request  of  the 
insured  strike  out  the  iron-safe  clause. 
Parsons  v.  Knoxville  F.  Ins.  Co.,  132 
Mo.  583  ;  Georgia  Home  Ins.  Co.  v. 
Allen  (Ala.),  24  So.  399.  But  under  a 
standard  policy,  like  that  of  Michigan, 
which  provides  that  an  agent  can  only 
■waive  its  provisions  by  indorsement, 
the  agent  cannot  verbally  waive  proofs 
of  loss.  Wadhams  v.  Western  Ass.  Co., 
117  Mich.  514.  An  agent's  consent  not 
indorsed  on  the  ]iolicy,  when  such  in- 
dorsement is  required  thereby,  is  void. 
Quinlan  v.  Providence  Washington  Ins. 
Co.,  133  N.  Y.  356.  But  .see  Dowling 
V.  Lanca.shire  Ins.  Co.,  92  Wis.  63  ; 
Miller  v.  Scottish  Union  Ins.  Co.,  101 
Mich.  49 ;  German  Ins.  Co.  v.  Rounds, 
35  Neb.  752  ;  St.  Paul  F.  &  M.  Ins.  Co. 
V.  Parsons,  47  Minn.  352. 


CH.  YII.]         AGENTS.  —  THEIR   POWERS   AND   DUTIES.  [§  126 

settle  the  terms  of  insurance,  and  to  carry  them  into  effect 
by  issuing  and  renewing  policies,  must  be  regarded  as  the 
general  agent  of  the  company,  pending  negotiations.  ^  And 
if  he  has  an  appointment  as  "agent  and  surveyor,"  he  will 
be  presumed,  in  the  absence  of  restriction,  to  have  all  the 
powers  incident  to  both  capacities. ^  But  it  is  held  in  Mas- 
sachusetts that  such  an  agent  has  not  authority  to  waive 
proofs  of  loss. 3  And  the  possession  of  blank  policies  and 
renewal  receipts,  signed  by  the  president  and  secretary,  is 
evidence  of  such  general  agency.*  Authority  to  do  a  partic- 
ular act  cairies  with  it  the  authority  to  make  available  the 
ordinary  means  by  which  the  act  may  be  accomplished.  If 
the  president  of  an  insurance  company  be  authorized  by  the 
by-laws  to  "adjust  and  pay  losses,"  he  may  indorse  notes 
held  by  the  company  and  deliver  them  in  payment. °  And 
though  by  the  charter  or  by-laws  the  powei'S  of  officers  may 
be  restricted,  they  may  bind  the  company  though  they  ex- 
ceed their  powers,  especially  if  such  excess  is  known  and 
acquiesced  in.^ 

A  secretary,  authorized  to  answer  all  "communications  in 
behalf  of  the  company,"  may  bind  the  company  by  his  ad- 
missions in  such  correspondence  as  to  the  sufficiency  of  a 
notice  of  loss.'^  So  authority  to  settle  the  terms  upon  which 
a  change  in  the  risk  may  be  made  carries  with  it  the  right 
to  waive  a  forfeiture  by  reason  of  a  change  in  the  risk ;  ^  and 
special  authority  to  settle  for  a  loss  carries  with  it  the  right 

1  Post  V.  .Etua  Ins.  Co.,  43  Barb.  (N.  Y. )  351  ;  Pitney  r.  Glen's  Falls  Ins.  Co., 
65  N.  Y.  6,  affirming  s.  c.  61  Barb.  (N.  Y.)  335  ;  post,  §§  129,  138. 

2  Lycoming  Fire  Ins.  Co.  v.  Woodworth,  83  Pa.  St.  223. 
8  Lohmes  v.  Ins.  Co.  of  N.  A.,  121  Mass.  439. 

*  Carroll  v.  Charter  Oak  Ins.  Co.,  40  Barb.  (N.  Y.)  292.  [If  a  foreign  com- 
pany  appoints  A.  and  B.  as  local  agents,  and  supplies  them  with  blank  policies 
signed  by  the  company,  and  which  they  may  fill  up  and  eounter.sign,  they  are 
its  general  agents.     Continental  Ins.  Co.  v.  Ruckman,  127  111.  364.] 

5  Baker  v.  Cotter,  45  Me.  236. 

6  Ibid.  Agents  may  also  act  as  effectually  by  clerks  as  by  themselves  per- 
sonally. Bodine  v.  Exchange  Fire  Ins.  Co.,  51  N.  Y.  117  ;  Eclectic  Ins.  Co.  v. 
Fahrenkrug,  68  111.  463  ;  Continental  Life  Ins.  Co.  i\  Goodall,  Cincinnati  Supr 
Ct.,  5  Big.\ife  &  Ace.  Ins.  Cas.  422  ;  post,  §  155. 

"•  Troy  Fire  Ins.  Co.  v.  Carpenter,  4  Wis.  32. 

8  North  Berwick  Co.  v.  New  England  Fire  &  Mar.  Ins.  Co.,  52  IMe.  336. 

235 


§  126  A]        INSURANCE:    FIRE,    LIFE,   ACCIDENT,   ETC.        [CII.  VII. 

to  extend  the  time  limited  by  the  conditions  of  the  policy, 
within  which  the  statement  of  the  loss  is  to  be  made.^  But 
authority  to  take  applications  and  surveys,  to  receive  pre- 
miums and  give  certificates  of  insurance,  subject  to  the  ap- 
proval of  the  directors,  does  not  give  authority  to  make  a 
contract  not  subject  to  such  approval. ^  It  is  to  be  observed, 
howevei',  that  the  decided  inclination  of  the  courts  is  to  ex- 
tend, rather  than  restrict,  the  power  of  agents  as  to  all  that 
they  may  say  or  do  touching  the  contract.^ (a)  Authority, 
however,  to  two  persons  to  act  as  "agent"  terminates  with 
the  death  of  either.* 

[§  126  A.  Agents  authorized  to  take  applications  for  in- 
surance are  acting  within  the  scope  of  their  authority  in 
everything  which  they  do,  which  may  be  necessary  to  com- 
plete such  applications.^  An  agent  cannot  effect  insurance 
in  another  company  to  protect  his  own  company  on  property 
covered  by  it,  without  special  authority,  and  where  the  same 
person  is  agent  for  both  companies,  such  conduct  is  a  breach 
of  trust.  ^  One  who  has  authority  to  take  applications,  re- 
ceive and  receipt  for  premiums,  forward  them,  receive 
policies  from  the  company,  and  deliver  them  after  counter- 
signing them,  has  no  power  to  bind  the  company  by  a  con- 
tract of  insurance  in  any  other  way  than  by  delivery  of  a 
policy  issued  by  the  company.''] 


1  Lycoming  County  Mut.  Ins.  Co.  v.  Schollenberger,  44  Pa.  St.  259. 

2  Insurance  Co.  v.  Johnson,  23  Pa.  St.  72  ;  Morse  v.  St.  Paul's  Fire  &  Mar. 
Ins.  Co.,  21  Minn.  407. 

8  Union  Mut.  Ins.  Co.  v.  Wilkinson,  13  Wall.  (U.  S.)  222.  And  see  post, 
§  509. 

*  Hartford  Ins.  Co.  v.  Wilcox,  57  111.  180  ;  Martina  v.  International  Life  Ins. 
Co.,  62  Barb.  (N.  Y.)  181  ;  affirmed,  53  N.  Y.  339. 

6  [Combs  V.  Hannibal  Savings  &  Ins.  Co.,  43  Mo.  148,  152.] 

6  [London,  &c.  Fire  Ins.  Co.  v.  Turnbull,  86  Ky.  230.] 

'  [Armstrong  v.  State  Ins.  Co.,  61  Iowa,  212.] 

(«)  Neither  the  agency  nor  the  extent  Van    Sickle    v.    Keith,    88    Iowa,    9; 

of  its  powers  can  be  established  by  the  O'Leary  v.  German-American  Ins.  Co., 

declarations  of  the  supposed  agent  with-  100    id.   390;     Dickerman    v.    Quincy 

out  the  knowledge  of  his  principal  ;  but  Mut.  F.  Ins.  Co.,  67  Vt.  609  ;  Eaton  v. 

the  agent  may  prove   his  agency  and  Granite     State     Provident     Ass'n,     89 

powers  by  his  own  testimony  and  oath.  Maine,  58. 

236 


CH.  VII.]         AGENTS.  —  THEIR   POWERS   AND   DUTIES.  [§  128 

§127.  Agents  of  Stock  and  Mutual  Companies. — In  gen- 
eral, it  may  be  said  that  the  agents  and  officers  of  companies 
organized  with  a  capital  stock  divided  into  shares  have 
greater  powers  in  determining  what  shall  be  the  terms  of 
the  contract  and  in  waiving  a  compliance  with  its  stipula- 
tions, than  those  of  companies  organized  on  the  mutual  prin- 
ciple, in  which  the  by-laws  are  made  to  fix  and  regulate,  by 
the  same  stipulations  in  every  policy,  the  rights  of  all  the 
assured  alike.  ^  And  it  will  be  seen  as  we  proceed,  that 
while  some  courts,  as  those  of  Massachusetts  and  New  Jer- 
sey, with  a  view  to  promote  the  safety  and  efficiency  of  such 
companies,  have  confined  the  powers  of  the  agents  and  offi- 
cers of  mutual  insurance  companies  strictly  within  the  limits 
marked  out  by  their  charters  and  by-laws  as  interpreted  in 
the  light  of  the  purposes  for  which  such  companies  were 
established,  others,  looking  rather  to  the  protection  and 
safety  of  those  who  are  dealing  with  such  officers  and  agents, 
have  shown  a  perhaps  increasing  inclination  to  give  a  liberal 
construction  to  those  provisions  of  the  charters  and  by-laws 
which  tend  to  limit  such  powers. 

§  128.  May  bind  the  Company  by  Parol  Contract.  —  It  has 
been  at  length  settled  by  numerous  decisions,  as  we  have 
already  seen,^  that  the  officers  of  a  company  may  make  a 
valid  contract  of  insurance  even  by  parol,  and  may  bind  the 
company  which  they  represent  by  an  agreement  to  insure  as. 
effectually  as  by  a  policy  issued  in  due  form,  even  where  the 
charter  of  the  company  requires  that  every  contract,  bargain, 
policy,  or  other  agreement  shall  be  in  writing,  signed  by  the 
president,  and  sealed  with  the  corporate  seal.  But  the  ex- 
ercise of  such  powers  will  not  bind  the  company  unless 
clearly  within  the  scope  of  the  agent's  authority  and  of  the 
powers  of  the  company.  While  a  parol  agreement  to  issue 
a  policy  would  be  valid,  a  merely  collateral  promise  or  rep- 
resentation which  does  not  involve  the  execution  of  a  policy 
would  not  be ;  as  is  shown  by  the  following  case.  The  plain- 
tiff, though  a  broker,  applied  to  the  defendants  for  insurance 

1  Brewer  v.  Chelsea  Mat.  Fire  Ins.  Co.,  14  Gray  (Mass.),  203. 

2  Aiite,  §  14  c<  seq. 

237 


§  129]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,    ETC.         [CH.  VII. 

to  a  definite  amount,  and  was  informed  that  it  would  be 
taken.  The  defendants  subsequently  sent  to  the  broker 
their  own  policy  for  a  part,  and  the  policies  of  three  other 
companies  for  the  residue,  executed  by  an  agent  for  the  lat- 
ter companies.  The  broker  on  receiving  the  policies  wrote, 
in  the  absence  of  his  principals,  to  the  defendants,  to  say 
that  he  doubted  whether  the  three  latter  policies  would  be 
accepted,  alleging  as  a  reason  that  the  agent  had  not  a  good 
reputation  for  settling  losses,  and  adding,  "  I  don't  know 
whether  it  is  your  custom  to  guarantee  the  offices  you  insure 
in  or  not.  If  you  do,  I  may  prevail  on  "  the  plaintiff  "  to 
hold  the  policies."  The  secretary  of  the  defendants,  in 
reply,  wrote:  "In  handing  the  policies"  to  the  plaintiff, 
"you  can  say  that,  if  the  boat  is  not  insured  in  offices  satis- 
factory to  him,  we  will  have  them  cancelled;  but,  though 
they  are  not  reinsurances,  yet,  in  case  of  loss,  we  will  feel 
ourselves  bound  for  a  satisfactory  adjustment.  We  deem 
the  companies  good,  and  if  any  parties  can  settle  with  them, 
we  can."  On  the  faith  of  this  letter  the  transaction  was 
closed ;  and  one  of  the  substituted  companies  having  failed, 
and  a  loss  having  occurred,  a  special  action  was  brought 
against  the  defendants,  which  resulted  unfavorably  to  the 
plaintiff,  on  the  ground  that  such  a  contract  was  not  within 
the  scope  of  the  secretary's  authority,  because  not  strictly 
within  the  scope  of  the  powers  granted  to  the  corporation.^ 

§  129.  General  Agent  of  Stock  Company,  pending  Negotia- 
tions. —  The  power  of  an  agent  of  a  stock  company  held  out 
by  the  company  to  the  public  as  such,  and  intrusted  with 
policies  in  blank,  signed  by  the  president  and  secretary,  and 
to  be  filled  up,  indorsed,  countersigned,  and  issued  by  the 
agent,  is  plenary  as  to  the  amount  and  nature  of  the  risk, 
the  rate  of  premium,  and  generally  as  to  the  terms  and  con- 
ditions of  the  contract;  and  he  may  make  such  erasures,  ex- 
planations, memoranda,  and  indorsements,  and  give  such 
advice  and  information,  modifying  or  limiting  the  general 
provisions  of  the  policy,  and  even  inconsistent  therewith,  as 

1  Constant  v.  The  Allegheny  Ins.  Co.,  3  Wall.  Jr.  (U.  S.  C.  C.)  313  ;  s.  c. 
1  Am.  Law  Reg.  n.  s.  116. 

238 


en.  VII.]  AGENTS.  —  THEIR   POWERS   AND   DUTIES.  [§  129 

in  his  discretion  seems  proper,  before  the  policy  is  delivered 
and  accepted,  or  even  after,  if  this  be  his  habit  known  to 
the  office.  1  Having  the  authority  to  make  an  original  con- 
tract upon  terms  similar  to  those  contained  in  the  policies, 
signed  in  blank,  intrusted  to  him,  and  being  clothed  with 
such  general  powers,  he  may  before  the  delivery  modify  the 
terms  and  conditions  so  as  to  make  the  company  liable  for 
loss  by  special  cause,  from  liability  for  which  the  general 
printed  terms  of  the  policy  would  exempt  them,  and  allow 
the  insured  to  keep  articles,  use  modes  of  heating,  and  carry 
on  branches  of  manufacture  prohibited  by  the  printed  terms 
of  the  policy,  without  risk  of  forfeiture.  So  he  may  bind 
them  by  a  parol  contract  to  renew  from  time  to  time,^  and 
by  a  parol  contract  to  issue  a  policy.^  He  may  also  insert 
by  memorandum  or  indorsement  a  description  of  the  prop- 
erty insured  inconsistent  with  the  description  of  the  same 
contained  in  the  application,  and  such  change  will  be  effect- 
ual to  protect  the  insured,  although  the  policy  itself  provides 
that  all  the  conditions  named  in  the  survey  or  application 
are  to  be  fully  complied  with ;  and  such  survey  and  descrip- 
tion shall  be  deemed  to  be  a  part  of  the  policy,  and  a  war- 
ranty on  the  part  of  the  insured.^  These  acts  of  the  agent, 
it  is  to  be  observed,  are  such  as  are  done  in  the  process 
of  negotiation,^  and  while  the  contract  is  yet  incomplete. 
When  once  the  contract  is  perfected,  the  agent's  power  with 


1  Gloucester  Manuf.  Co.  v.  Howard  Fire  Ins.  Co.,  5  Gray  (Mass.),  498  ; 
Broo.kelbank  v.  Sugrue,  5  C.  &  P.  21 ;  Warner  v.  Peoria  Mar.  &  Fire  Ins.  Co., 
14  Wis.  318 :  Dayton  Ins.  Co.  v.  Kelly,  24  Ohio  St.  345  ;  ante,  §  126  ;  Rowley  v. 
Empire  Fire  Ins.  Co.,  36  N.  Y.  550;  Malleable  Iron  Works  v.  Phoenix  Ins.  Co., 
25  Conn.  465;  Combs  v.  Hannibal  Ins.  Co.,  43  Mo.  148;  Moliere  v.  Penn  Fire 
Ins.  Co.,  5  Rawle  (Pa.),  342;  Benson  v.  Ottawa  Agr.  Ins.  Co.,  42  U.  C.  (Q.  B.) 
282  ;  Marcus  v.  St.  Louis  Ins.  Co.,  68  N.  Y.  625.  But  see  Hartford  Fire  Ins. 
Co.  V.  Webster,  69  111.  392.  [A  general  agent  has  power  to  modify  or  cancel  a 
contract  which  he  has  the  power  to  make.  Anderson  v.  Coonley,  21  Wend.  279, 
280.  When  by  mistake  the  policy  was  made  payable  to  A.,  but  by  indorsement 
thereon,  the  secretary  changed  it  to  B.,  the  real  party  applicant,  it  was  held  a 
valid  contract  with  B.     Solmes  v.  Rutgers  Fire  Ins.  Co.,  3  Keyes,  416,  418.] 

2  Baubie  v.  ^tna  Ins.  Co.,  2  Dill.  C.  Ct.  156. 

8  Angell  V.  Hartford  Fire  Ins.  Co.,  59  N.  Y.  171. 
*  See  cases  cited,  n.  1,  p.  225. 
6  Post,  §  144. 

239 


§130]  insurance:    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  VII. 

reference  thereto  is  in  many  respects  exhausted;^  and  his 
power  to  deal  with  facts  and  circumstances  arising  after  the 
completion  of  the  contract  is  by  no  means  so  extensive. ^ 
An  ao-ent  authorized  to  take  risks  and  issue  policies  cannot, 
for  instance,  waive  preliminary  proofs. ^ 

§180.  Same  Subject;  Authority  to  insure  Property  located 
beyond  his  District.  —  And  such  a  general  agent,  authorized 
to  effect  insurance  "for  a  particular  city  and  its  vicinity," 
may  nevertheless  insure  property  located  beyond  the  geo- 
graphical limits  of  his  agency,  and  within  those  of  another 
agent.  Private  instructions  restricting  his  agency  cannot 
affect  the  relations  between  the  insured  and  the  insurers. 
Besides,  such  a  restriction  would  seem  to  apply  rather  to 
the  sphere  within  which  the  agent  should  act,  than  to  the 
property  which,  while  acting  within  prescribed  limits,  he 
might  insure,  although  located  beyond  those  limits.*  He 
may  also  bind  his  principal,  even  though  he  act  contrary  to 
his  instructions,  if  what  he  actually  does  is  fairly  deducible 
from  his  authority  as  general  agent,  the  instructions  which 
he  violated  not  being  known  to  the  insured.  If  such  agent 
fails  in  his  duty  to  his  principal  it  is  no  fault  of  the  in- 
sured.^ And  the  delivery  by  such  agent  of  a  policy  to  which 
the  insured  is  fairly  entitled  in  execution  of  a  subsisting 
agreement  is  good,  although  before  its  delivery  the  insurers 
notify  the  insured  that  they  will  not  be  bound  by  it,  and  that 
they  have  revoked  the  authority  of  the  agent  to  act  for  them.^ 
Notice  to  him  that  gunpowder  is  at  the  time  of  insurance, 
and  will  thereafter  be,  kept  on  the  premises  for  sale,  is  a 
notice  to  the  company ;  and  if  after  such  notice  a  policy  be 
issued  containing  a  condition  that  if  gunpowder  is  so  kept, 

1  Healey  v.  Imperial  Fire  Ins.  Co.,  5  Nev.  268. 

2  See  post,  §§131,  138. 

8  Lohnes  v.  Insmance  Co.,  121  Mass.  439.  See  also  Wilson  v.  Genesee 
Mut.  Ins.  Co.,  14  N.  Y.  418,  reversing  s.  c.  16  Barb.  (N.  Y.)  511  ;  Bush  v. 
Westchester  Fire  Ins.  Co.,  63  N.  Y.  531  ;  Reynolds  v.  Continental  Ins.  Co., 
36  Mich.  131. 

4  Lightbody  v.  North  American  Ins.  Co.,  23  Wend.  (N.  Y.)  18. 

6  Gloucester  Manuf.  Co.  v.  Howard  Fire  Ins.  Co.,  5  Gray  (Mass.),  497. 

«  Lightbody  i;.  North  American  Ins.  Co.,  23  Wend.  (N.  Y.)  18;  Woodbury 
Savings  Bank  v.  Charter  Oak  Ins.  Co.,  31  Conn.  517. 

240 


CH.  VII.]         AGENTS.  —  THEIR   POWERS  AND   DUTIES.  [§  131 

without  written  permission  in  the  policy,  the  policy  shall  be 
void,  the  condition  is  waived. ^ 

[§  130  A.  Alteration  of  PoUcy.  —  When  the  Original  policy 
was  rendered  void  by  an  act  of  the  agent,  who  with  good  in- 
tentions, but  without  authority,  altered  the  policy  to  make  it 
correspond  to  the  agreement,  and  a  loss  thereafter  occurred, 
the  company  were  held  bound  by  the  first  intentions  of  the 
parties. 2  An  agent  who  forwards  the  application  to  the 
company  and  whose  power  is  therefore  manifestly  limited  to 
delivery  of  the  policy  and  receipt  of  the  premium,  cannot 
rightly  be  supposed  to  have  power  to  alter  the  contract  by 
the  insertion  of  a  clause  agreeing  to  pay  the  loss  to  an- 
other than  the  assured.  An  agent  undertaking  to  procure  a 
change  in  a  policy  acts  for  the  insured.^  A  clause  inserted 
in  a  policy  without  authority  may  be  ratified  by  the  company.*] 

§  131.  Same  Subject;  Opinions.  — Mistakes  of  omission  or 
commission,  made  by  such  an  agent  in  the  description  of 
the  property  insured  or  otherwise,  he  knowing  or  having  the 
means  of  knowing  the  truth,  and  not  being  misled  by  the 
insured,  cannot  be  availed  of  by  the  company  to  the  preju- 
dice of  the  latter.^  Though  it  has  been  held  that  the  agent 
cannot  give  a  partner  who  insures  the  partnership  property 
in  his  own  name  only,  under  the  belief,  induced  by  the  ex- 
pressed opinion  of  the  agent  to  that  effect,  that  such  insur- 
ance would  cover  the  copartnership  interest,  a  claim  against 
the  company  for  more  than  his  own  interest,^  it  has  been 
distinctly  held  to  the  contrary  in  several  well-considered 
cases.''     And  where  one   party  who  owns  a  building  joins 

1  Peoria  Mar.  &  Fire  Ins.  Co.  v.  Hall,  12  Mich.  202  ;  post,  §132  ;  Manhattan 
Fire  Ins.  Co.  v.  Weill,  28  Grat.  (Va.)  389  ;  Mobile,  &c.  Ins.  Co.  v.  Miller,  58 
Ga.  420. 

2  [Biinten  v.  Orient  Mut.  Ins.  Co.,  2  Keyes,  667,  669.] 

s  [Duluth  National  Bank  v.  Knoxville  Fire  Ins.  Co.,  85  Tenn.  76,  85.] 

4  [Andrews  v.  ^tna  Life  Ins.  Co.,  92  N.  Y.  596.] 

5  Ayres  v.  Home  Ins.  Co.,  21  Iowa,  185;  Emery  v.  Piscataqua  Fire  &  Mar. 
Ins.  Co.,  52  Me.  322  ;  New  England  Fire  &  Mar.  Ins.  Co.  v.  Schettler,  38  111. 
166;  Mtna.  Live-Stock,  &c.  Ins.  Co.  r.  Olmstead,  21  Mich.  246. 

6  Peoria  Mar.  &  Fire  Ins.  Co.  v.  Hall,  12  Mich.  202. 

T  Manhattan  Ins.  Co.  v.  Webster,  9  P.  F.  Smith  (Pa.),  227;  Anson  v. 
Winnesheik  Ins.  Co.,  23  Iowa,  84.  See  also  Keith  v.  Globe  Ins.  Co.,  52  111.  508  ; 
Aurora  Fire  Ins.  Co.  v.  Eddy,  55  111.  213,  222. 

VOL.  I.  — 16  241 


§  131]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.        [CH.  VII. 

with  another  party  who  owns  the  personal  property  within 
the  building,  in  an  application,  which  is  filled  up  and  for- 
warded by  the  agent  of  the  company  to  whom  all  the  facts 
are  known,  and  a  policy  is  issued  purporting  to  insure  the 
parties  as  joint  owners  of  the  real  and  personal  estate,  the 
insurers  will  be  estopped  to  deny  that  the  title  is  a  joint 
one.i  So  if  the  general  agent  makes  a  mistake  as  to  the 
character  of  the  insurable  interest  of  the  applicant,  the  facts 
being  correctly  stated  to  him,  and  sets  it  down  as  an  abso- 
lute, instead  of  a  qualified,  interest,  which  it  really  is,  the 
company  is  estopped  to  deny  that  the  interest  is  truly 
stated. 2  So  if  the  agent  express  the  opinion  that  the  an- 
nual premium  will  fall  due  on  a  certain  day,^  or  that  it  is 
not  necessary  to  state  that  he  has  had  sunstroke,*  or  that 
certain  outstanding  judgments  do  not  amount  to  an  incum- 
brance, —  such  errors  of  opinion  will  be  imputable  to  the 
company ;  and  a  statement  that  there  is  no  incumbrance  will 
not  avoid  the  policy,  notwithstanding  the  policy  provides 
that  if  the  agent  of  the  company  assumes  to  violate  any  of 
its  conditions,  such  violation  shall  be  construed  to  be  the 
act  of  the  insured,  and  shall  render  void  the  policy.^    So,  if 

1  Peck  V.  New  London  Co.  Mut.  Fire  Ins.  Co.,  22  Conn.  575. 

2  Atlantic  Ins.  Co.  v.  Wright,  22  111.  462.  See  also  Ashford  v.  Victoria  Mut. 
Fire  Ins.  Co.,  20  U.  C.  (C.  P.)  434.  Though  the  agent's  authority  be  limited  to 
soliciting  and  forwarding  applications,  this  authority  implies  the  right  to  do 
whatever  may  be  necessary,  by  way  of  suggestion  in  matters  of  description  or 
otherwise,  to  perfect  it.     Combs  v.  Hannibal  Ins.  Co.,  43  Mo.  148. 

^  Campbell  v  International  Life  Ass.  Soc,  4  Bosw.  (N.  Y. )  Superior  Ct.  298  ; 
post,  §  134. 

*  Boos  V.  World  Mut.  Life  Ins.  Co.,  6  T.  &  C.  (N.  Y.)  364  ;  s.  c.  64  N.  Y. 
236. 

^  "  If,"  said  Mr.  Chief  Justice  Woodward,  in  Columbia  Ins.  Co.  v.  Cooper, 
50  Pa.  St.  331,  "the  agent  returned  that  there  were  no  incumbrances,  when  he 
had  been  informed  that  there  were  judgments  and  a  lease,  he  may  have  violated 
the  '  conditions  ; '  but  no  company  has  a  right  to  select  and  send  out  agents  to 
solicit  patronage  and  business  for  its  benefit,  and  then  to  saddle  their  blunders 
upon  its  customers.  If  the  assured  combine  with  the  agent  to  cheat  the  com- 
pany, we  protect  the  company  (referring  to  Smith  v.  Ins.  Co.,  post,  §  149)  ;  but 
if  the  assured  has  covenanted  for  nothing,  and  has  been  guilty  of  no  misrepresen- 
tation, concealment,  or  fraud,  the  company  had  better  pay  his  loss,  than  to 
attempt  to  make  him  responsible  for  the  blunders  of  their  agent."  And  to  the 
suggestion  that,  the  assured  being  a  member  of  a  mutual  insurance  company,  the 
agent  was  his  agent,  the  learned  judge  replied  :  "The  charters  of  these  mutual 

242 


CH.  VII.]         AGENTS. —  THEIR   POWERS    AND    DUTIES.  [§  132 

the  agent  express  the  opinion  that  an  accidental  omission  of 
which  he  is  informed  will  make  no  difference.' 

§  132.  Agent's  Knowledge,  Knowledge  of  Principal.  —  Facts 
material  to  the  risk,  made  known  to  the  agent  (or  a  sub- 
agent  ^  intrusted  with  the  business)  before  the  policy  is 
issued,  are  constructively  known  to  the  company,  and  can- 
not be  set  up  to  defeat  a  recovery  on  the  policy.^  If  the 
agent  proceeds  and  fills  out  the  application  upon  his  own 
knowledge,  the  principal  cannot  question  the  correctness  of 
his  statements.^  So  the  issue  of  a  policy,  after  verbal  notice 
to  the  agent  of  an  existing  incumbrance,  is  a  waiver  of  the 
written  notice  required  by  the  terms  of  the  contract.^  And 
it  has  even  been  held  that  the  knowledge  by  an  agent  of  the 
assignment  of  a  policy,  prior  to  the  declaration  of  bank- 
ruptcy, is  notice  to  the  company  sufficient  to  prevent  the 
policy  from  passing  to  the  assignee  in  bankrupcty.^  But 
consent  of  an  agent  for  securing  applications  to  an  assign- 
ment will  not  bind  the  company,  when  the  very  form  of  the 
assignment  on  the  policy  implies  that  it  requires  the  con- 
sent of  an  officer  of  the  company.'''  And  especially  will  the 
agent  bind  the  company,  if  the  applicant  be  compelled  by 
the  rules  of  the  company,  either  to  apply  to  the  agent  to 
make  the  survey,  or  to  make  it  himself,  strictly  in  accord- 
companies  do  make  the  assured  members,  but  I  take  it  membership  does  not  be- 
gin till  the  contract  is  complete  and  the  policy  issued.  As  to  all  preliminary- 
negotiations,  the  agent  acts  only  on  behalf  of  the  company." 

1  Farmers'  &  Merchants'  Ins.  Co.  v.  Chesnut,  50  111.  111. 

2  [The  knowledge  of  a  clerk  of  the  agent  sent  by  him  to  solicit  insurance  and 
take  an  application,  that  there  was  other  insurance,  binds  the  company  as  much 
as  if  the  agent,  master  of  the  clerk,  knew  of  it.  Bennett  v.  Council  IJluffs  Ins. 
Co.,  70  Iowa,  600.] 

3  People's  Ins.  Co.  v.  Spencer,  53  Pa.  St.  353  ;  Liddle  v.  Market  Fire  Ins. 
Co.,  4  Bosw.  (N.  Y.)  179  ;  Beal  v.  Park  Ins.  Co.,  16  Wis.  257  ;  Kelly  v.  Troy 
Fire  Ins.  Co.,  3  Wis.  229 ;  Hough  v.  City  Fire  Ins.  Co.,  29  Conn.  10  ;  Keenan  v. 
Mo.  State  Mut.  Ins.  Co.,  12  Iowa,  126  ;  Combs  v.  Hannibal  Savings  &  Ins.  Co., 
43  Mo.  148  ;  Plumb  v.  Cattaraugus  Mut.  Ins.  Co.,  18  N.  Y.  392  ;  Ashford  v. 
Victoria  Mut.  Ins.  Co.,  20  U.  C.  (C.  P.)  434  ;  ante,  §  130  ;  post,  §  152  ;  May  v. 
Buckeye  Mut.  Ins.  Co.,  25  Wis.  291. 

*  Commercial  Ins.  Co.  v.  Ives,  56  111.  402. 

6  Ames  V.  N.  Y.  Union  Ins.  Co.,  14  N.  Y.  (4  Kern.)  253. 
«  Gale  V.  Lewis,  16  L.  J.  N.  s.  (Q.B.)  119. 

7  Stringham  v.  St.  Nicholas  Ins.  Co.,  3  Keyes  (N.  Y.),  280.    But  see  Farmers 
Mut.  Fire  Ins.  Co.  v.  Taylor,  73  Pa.  St.  342. 

243 


§  133]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.         [CH.  VII. 

ance  with  certain  requirements,  and  the  agent  is  so  applied 
to ;  ^  or  if  the  company  depends  upon  its  own  knowledge  of 
the  facts  furnished  by  its  agent  after  a  personal  examina- 
tion. The  issue  of  a  policy  under  such  circumstances  is  an 
assertion  of  its  validity,  however  untrue  may  be  the  state- 
ments of  the  application,  which  the  insurers  cannot  be 
allowed  to  gainsay.  ^ 

§  133.  Misrepresentations  and  Torts  of  Agent.  —  The  agent 
of  a  stock  company,  appointed  under  its  by-laws  to  solicit 
risks,  receive  and  transmit  applications,  receive  back  and 
deliver  policies,  and  receive  notes  for  the  premiums  on 
marine  risks,  and  cash  for  those  on  fire  risks,  whose  ser- 
vices are  paid  for  by  the  company  by  a  commission  on  the 
premiums  received  by  him,  and  who  is  specially  authorized 
by  the  president  and  secretary  to  state  to  applicants  for  in- 
surance, who  inquire  upon  the  subject,  that  the  capital  of 
the  company  is  all  paid  in  and  invested  according  to  law, 
may  also  bind  the  company  by  his  representations  as  to  the 
condition  of  the  company  and  its  ability  to  fulfil  its  con- 
tracts.^ And  the  company  is  liable  to  third  persons  for  any 
injurious  statements  or  acts  in  the  course  of  his  employ- 
ment. *  [The  representation  of  an  insurance  agent  made  in 
good  faith,  but  without  authority,  that  neglect  to  pay  the 
premiums  would  not  work  a  forfeiture  but  would  simply  turn 
the  policy  into  a  paid-up  policy,  binds  the  company,  so  far 
that  neglect  to  pay  premiums  on  the  faith  of  the  statement 
will  not  avoid  the  policy.^  A  misrepresentation  of  the 
agent  that  non-occupancy  had  rendered  the  policy  void,  in 
consequence  of  which  false  statement  the  plaintiff  settled  for 
one -fourth  of  his  rightful  claim  against  the  company,  is  not 

1  Roth  V.  City  Ins.  Co.,  6  McLean  (U.  S.  C.  Ct.),  324. 

2  Cvimberland  Valley  Mut.  Prot.  Ins.  Co.  v.  Schell,  29  Pa.  31  ;  Com.  Ins.  Co. 
V.  Ives,  56  111.  402. 

8  Fogg  et  al.  V.  Griffin  et  al.,  2  Allen  (Mass.),  1  ;  Williams  et  al.  v.  Pew,  id.  ; 
Jones  V.  Dana,  24  Barb.  (N.  Y. )  395. 

*  New  York  Life  Ins.  Co.  v.  McGowan,  18  Kans.  300  ;  Martin  v.  Mtna.  Life 
Ins.  Co.  (Tenn.),  4  Ins.  L.  J.  899  ;  American  Ins.  Co.  v.  Capps,  4  Mo.  App.  Rep. 
571  ;  Eilenberger  v.  Protective  Mut.  lus.  Co.  (Pa.),  8  Ins.  L.  J.  822,  823  ;  89  Pa. 
St.  464. 

6  [Lovell  V.  St.  Louis  Mut.  Life  Ins.  Co.,  Ill  U.  S.  264.] 
244 


CH.  VII.]         AGENTS.  —  THEIR    POWERS   AND    DUTIES.  [§  133 

actionable,  whether  it  be  regarded  as  a  statement  of  the  law 
ol  insurance  or  of  opinion  in  regard  to  a  fact.^  A  misrepre- 
sentation by  a  soliciting  agent  in  regard  to  the  policies  of  a 
rival  company  is  not  such  fraud  as  to  avoid  the  contract  of 
the  assured  to  pay  the  premium.  It  induced  him  to  take  the 
policy ;  but  the  means  of  information  were  equally  open  to 
both  parties,  and  the  insured  should  not  have  relied  on  the 
"trade  talk  "  of  the  agent.^  Where  a  soliciting  agent  showed 
the  plaintiff  a  pamphlet  describing  the  tontine  system,  which 
plaintiff  read,  and  the  policy  provided  that  no  statements  of 
the  agent  should  bind  the  company  unless  reduced  to  writ- 
ing and  presented  to  the  officers  at  the  home  office,  it  was 
held  that  evidence  of  misrepresentations  made  by  the  solicit- 
ing agent  were  inadmissible.  In  view  of  the  full  description 
in  the  pamphlet  and  the  provisions  of  the  policy,  the  agent's 
remarks  were  mere  recommendations  and  expressions  of  his 
own  opinion  upon  which  the  plaintiff  had  no  right  to  rely.^ 
The  declarations  of  a  stranger,  though  made  in  the  presence 
of  an  officer  of  the  company,  must  not  be  relied  on  without 
inquiring  if  they  represent  the  intentions  of  the  company.^] 
And  it  seems  that  the  local  agent  of  a  mutual  company  is 
presumed  to  be  authorized  to  make  answers  to  inquiries  as 
to  the  standing,  pecuniary  or  otherwise,  of  the  company  he 
represents,^  though  not  as  to  the  territorial  limits  within 
which  the  company  takes  risks,  ^  unless  the  assured  has 
notice  that  the  company  will  not  be  bound  by  any  such 
statements,  or  other  statements  not  contained  in  the  appli- 
cation.^ But  not  every  such  statement  will  bind  the  com- 
pany. An  agent  appointed  to  "  transact  business  "  for  the 
insurers,  "and  for  those  who  are  insured  or  make  applica- 
tion to  be  insured  "  by  them,  has  no  authority  to  bind  the 

1  [Tliompson  v.  Phojnix  Ins.  Co.,  75  Me.  55.] 

2  [American,  &c.  Ins.  Co.  v.  Wilder,  39  Minn.  350,  Dickinson,  J.,  dissenting.] 

3  [Simons  v.  N.  Y.  Life  Ins.  Co.,  38  Hun,  309.] 

*  [East  Tex.  Fire  Ins.  Co.  v.  Coffee,  61  Tex.  287.] 
6  Devendorf  v.  Beardsley,  23  Barb.  (N.  Y.)  656.     And  see  post,  §  552. 
6  Hackney  v.  Alleghany  Co.  Mut.  Ins.  Co.,  4  Barr  (Pa.),  185 ;  post,  §  148. 
T  Shawmut  Mut.  Fire  Ins.   Co.  v.  Stevens,  9  Allen  (Mass.),  332  ;  Chase  v, 
Hamilton  Mut.  Ins.  Co.,  20  N.  Y.  52. 

245 


§  133]        insurance:  fire,  life,  accident,  etc.        [ch.  vii, 

company  by  a  promise  that  the  insured  shall  not  be  called 
upon  to  pay  any  assessment  on  his  premium  note ;  though  if 
the  agent  falsely  represent  that  the  delivered  policy  is  free 
from  assessment,  the  applicant  will  be  entitled  to  such  a 
one;^  nor  will  his  highly  colored  statements  as  to  the  actual 
pecuniary  condition  and  future  prospects  of  the  company,  not 
absolutely  and  materially  fraudulent,  but  allowable  within 
the  fair  range  of  embellishment  and  chaffer  in  the  matter 
of  bargain,  vitiate  the  policy  which  the  insured  has  been 
induced  to  accept  under  such  promises  and  representations, 
unless  calculated  in  the  opinion  of  the  jury  to  impose  upon 
a  careful  and  prudent  man.  If  the  representations  are  of 
such  a  character  that  they  would  vitiate  other  contracts, 
they  will  vitiate  the  contract  of  insurance,  not  otherwise. 
The  stringent  rules  applied  to  misrepresentations  by  the 
insured  in  obtaining  insurance,  apply  only  to  statements 
materially  affecting  the  risk,  £fnd  do  not  apply  to  the  mis- 
representations of  the  insurers  in  procuring  parties  to  in- 
sure.2  In  this  case  a  reluctant  and  hesitating  defendant 
was  told  by  the  agent  that  the  company  had  a  great  sum  of 
money  in  its  treasury,  enough  to  pay  all  the  losses  for  five 
years;  that  if  he  would  pay  five  dollars  that  would  be  all 
he  would  have  to  pay;  and  that  there  would  be  a  dividend 
among  those  insured  at  the  end  of  five  years.  He  was  thus 
induced  to  pay  the  five  dollars  and  take  the  policy.  Instead 
of  the  dividend  came  a  series  of  assessments,  which  he  un- 
successfully resisted,  on  the  ground  that  the  policy  was  void 
by  reason  of  the  misrepresentations  whereby  he  was  induced 
to  accept  it. 2     In  Pennsylvania  it  has  been  held  that  the 

1  Keller  v.  Equitable  Fire  Ins.  Co.,  28  Ind.  170. 

2  Fanners'  Mxit.  Fire  Ins.  Co.  v.  Marshall,  29  Vt.  23. 

^  Some  observations  of  Redfield,  C.  J.,  are  worthy  of  a  place  here  :  "  To  what 
extent  the  agent's  representations,  in  effecting  insurances,  will  bind  the  companj', 
is  a  question  of  more  difficulty.  For  although  he  is  undoubtedly  a  general  agent 
for  transacting  a  particular  department  of  the  business  of  the  company,  in  a 
limited  district,  still  his  power  to  bind  the  company  is  certainly  not  unlimited. 
The  authority  of  a  general  agent  is  restricted  to  the  range  of  his  employment  and 
the  acts  and  representations  which  a  prudent  and  ordinarily  sagacious  and  ex- 
perienced person  might  expect  him  to  do,  or  to  be  authorized  to  make  on  behalf 
of  his  princi[)al.     The  representation  claimed  in  the  present  case  was  a  remarkable 

246 


CH.  VII.]         AGENTS. — THEIR  POWERS  AND   DUTIES.         [§  133  A 

agents  of  a  mutual  insurance  company  cannot  prejudice  the 
rights  of  the  company  by  misrepresentations  as  to  the  places 
where  risks  were  located ;  as  that  the  company  did  not  take 
risks  in  cities.^ 

[§  133  A.  Facts  known  to  Agent  before  Issue.  — A  policy 
cannot  be  avoided  by  the  company  on  the  ground  of  facts 
known  to  the  agent  at  the  time  he  made  the  survey  and 
application,    or   at   any   time   before   issue   of    the   policy. ^ 

one,  ami  one  not  very  well  calculated  to  impose  upon  men  much  experienced  in 
the  manner  of  transacting  the  business  of  such  companies.  But  so  large  a  pro- 
portion of  the  people,  especially  in  the  remote  rural  districts  of  the  State,  are 
almost  wholly  ignorant  upon  these  points,  and  are,  in  consequence,  so  readily 
made  the  victims  of  interested  solicitors  on  behalf  of  the  numerous  insurance 
companies,  who  are  found,  I  believe,  always  ready  and  urgent  to  insure  one 
against  all  the  calamities  of  life,  that  courts  ought  not,  perhaps,  to  require  any 
very  rigid  rules  of  circumspection  in  these  matters  from  wholly  inexperienced  per- 
sons. It  seems  to  us  altogether  a  question  of  fact,  whether  a  given  representation 
was  really  calculated  to  impose  upon  a  careful  and  prudent  man.  And  in  a  case 
where  that  question  should  become  important  it  would  be  proper,  when  raised  by 
counsel,  to  submit  it  to  the  jury.  But  it  seems  to  us  that  the  representation  of 
the  agent  in  this  case  or  stipulation,  if  we  so  consider  it,  is  not  of  the  class  which 
will  avoid  the  policy,  if  it  would  not  equally  avoid  a  written  contract  upon  any 
other  subject.  It  is  undoubtedly  true  that,  in  regard  to  representations  and  con- 
cealments affecting  materially  the  risk,  both  in  marine  and  tire  insurance,  policies 
may  be  avoided,  when  in  other  contracts  such  representations  certainly  would  not 
have  that  effect.  The  law  of  insurance  has  been  regarded  as  specially  requiring 
the  utmost  good  faith.  Hence  all  representations  inserted  in  the  policy,  or  con- 
tained in  the  application,  and  expressly  referred  to  iu  the  policy,  as  part  of  it,  are 
denominated  warranties,  and  must  be  strictly  complied  with  or  the  policy  is 
avoided.  And  in  regard  to  representations  and  concealments  which  are  material, 
and  directly  affect  the  risk,  whether  on  the  part  of  the  assured  or  the  insurer, 
unless  the  representations  are  substantially  true,  the  policy  is  void,  although  such 
representations  are  merely  by  parol,  and  made  at  and  before  the  time  of  etfecting 
the  insurance,  and  not  inserted  in  the  policy  ;  they  being  regarded  as  substantial 
fraud  in  regard  to  a  policy  of  insurance,  while  in  regard  to  ordinary  contracts 
similar  representations  would  perhaps  be  held  as  within  the  fair  range  of  allow- 
able embellishment  and  chaffer  in  the  matter  of  bargain  ;  or,  if  in  the  nature  or 
express  warranties,  would  be  held  to  have  been  waived,  by  not  being  inserted  in 
the  written  contract." 

1  Hackney  v.  Allegheny  Mut.  Ins.  Co.,  4  Barr  (Pa.),  185  ;  post,  §  148. 

2  [.Etna  Life  Ins.  Co.  v.  Paul,  10  Brad.  431,  443  (condition  of  health  known 
to  agent) ;  Kings'  Co.  Fire  Ins.  Co.  v.  Swigert,  11  Brad.  590  (knew  gasoline  was 
kept  on  the  premises)  ;  German  Fire  Ins.  Co.  v.  Carrow,  21  Brad.  631  (knew  build- 
ings were  not  entirely  on  plaintiff's  ground)  ;  Germania  Fire  Ins.  Co.  v.  Hick,  23 
Brad.  381  (knew  interest  of  assured) ;  Key  v.  Des  Moines  Ins.  Co.,  77  Iowa,  174  ; 
Bartlett  v.  Fireman's  Fund  Ins.  Co.,  77  Iowa,  155  ;  Insurance  Co.  v.  Barnes,  41 
Kans.  161  (condition  of  title) ;  Protective  Union  v.  Gardner,  41  Kans.  397  (omis- 
sion in  application  by  advice  of  the  agent)  ;  Hartford  Ins.  Co.  v.  Haas,  87  Ky. 

247 


§  133  B]        INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.         [CH.  VII. 

Even  it  is  said,  though  those  facts  were  falsely  stated  by 
the  assured,^  unless  there  was  collusion  between  the  agent 
and  the  insured  to  cheat  the  company,  or  facts  equivalent  \o 
collusion,^  or  express  limitation  in  the  policy.  When  with 
knowledge  of  the  circumstances  the  agent  of  the  company 
filled  in  the  application,  it  is  not  incumbent  on  the  assured 
to  better  the  condition  of  the  premises.^  Under  his  war- 
ranty to  keep  stovepipes,  &c.  well  secured,  he  is  only  bound 
to  keep  them  in  as  good  condition  as  the  agent  found  them, 
it  not  being  shown  that  the  agent  or  the  company  in  any 
way  indicated  to  the  insured  that  the  pipes  were  not  in  a 
satisfactory  state.  A  renewal  of  a  policy  with  the  agent's 
knowledge  of  misrepresentations  in  the  original  application, 
in  the  event  of  no  new  application  being  required,  binds  the 
company.*] 

[§  133  B.  Collusion  or  its  Equivalent  frees  the  Company.  — 
The  rule  which  charges  a  principal  with  the  knowledge  of 
his  agent  is  for  the  protection  of  innocent  third  persons.  If 
a  person  colludes  with  an  agent  to  cheat  the  principal,  the 
latter  is  not  responsible  for  the  act  or  knowledge  of  the 
agent. ^  If  the  insured  and  the  agent  put  their  heads  to- 
gether to  cheat  the  company  so  as  to  obtain  lower  rates  by 
misrepresentation,  the  company  will  be  protected.  But  a 
verdict  in  favor  of  the  plaintiff  necessarily  negatives  the 
existence  of  such  conduct.^     False  statements  by  the  assured 

531  ;  Richards  v.  Wash.  Fire  &  Mar.  Ins.  Co.,  60  Mich.  420 ;  Wilson  v.  Minn. 
Fanners'  Mut.  Ins.  Ass.,  36  Minn.  112  ;  Rivara  v.  Queen's  Ins.  Co.,  62  Miss.  720 
(agent  knew  at  time  of  insurance  that  articles  prohibited  by  policy  were  kept  on 
the  premises)  ;  Breckinridge  v.  Amer.  Cent.  Ins.  Co.,  87  Mo.  62  (agent  knew  of 
incumbrance  at  time  of  insurance)  ;  Hamilton  v.  Home  Ins.  Co.,  94  Mo.  353 
(agent  knew  other  insurance  at  issue  of  policy);  Stone  v.  Hawkeye  Ins.  Co., 
68  Iowa,  737  (knew  warranties  untrue)  ;  Siltz  v.  Hawkeye  Ins.  Co.,  71  Iowa,  710  ; 
Myers  i;.  Council  Bhiffs  Ins.  Co.,  72  Iowa,  176  ;  Roberts  v.  State  Ins.  Co.,  26 
Mo.  App.  92  ;  Liverpool,  &c.  Ins.  Co.  v.  Ende,  65  Tex.  118;  Insurance  Co.  v. 
Camp,  71  Tex.  503.] 

1  [Miller  v.  Hartford  Fire  Ins.  Co.,  70  Iowa,  704 ;  Witherell  v.  Me.  Ins.  Co., 
49  Me.  200.     But  see  §133B.] 

2  [See  §133  B,  and  §  137.] 

8  [Simmons  v.  Ins.  Co.,  8  W.  Va.  474,  495.] 

*  [Witherell  v.  Me.  Insurance  Co.,  49  Me.  200,  203.] 

6  [National  Life  Ins.  Co.  v.  Minch,  53  N.  Y.  144.] 

6  [Richards  v.  Washington  Fire  &  Mar.  Ins.  Co.,  60  Mich.  420.] 

248 


CH.  VII.]  AGENTS.  —  THEIR   POWERS   AND    DUTIES.  [§  133  C 

will  not  the  less  have  their  usual  effect  in  avoiding  the  con- 
tract because  the  agent  knows  of  them.^  To  tell  the  com- 
pany a  falsity  through  an  agent  who  is  aware  of  the  deception 
is  very  like  collusion,  and  identical  with  it  so  far  as  con- 
cerns the  effect  on  the  company  and  the  equity  of  the  assured. 
When  the  assured  made  material  false  representations  as  to 
his  health,  evidence  is  inadmissible  to  show  that  the  local 
agent  of  the  company  employed  to  solicit  risks  knew  at  the 
time  of  their  falsity. ^  The  applicant  must  know  the  extent 
of  the  agent's  authority,  and  in  such  a  case  must  clearly  be 
presumed  to  know  as  a  reasonable  man  that  the  agent  was 
committing  a  fraud  upon  his  principal  by  accepting  for  the 
company  what  he  (the  agent)  knew  to  be  a  false  representa- 
tion of  the  applicant's  health  in  the  application.  Knowl- 
edge on  the  part  of  the  agent  cannot  excuse  wilful  falsity 
in  the  assured,  and  although  the  agent  knew  the  purpose 
for  which  a  building  was  used  at  the  time  of  loss,  this  was 
no  defence  to  the  charge  that  the  insured  knowingly  made 
false  statements  in  regard  to  that  use,  in  the  proofs  of 
loss.^] 

[§  133  C.  Agent's  Negligence  or  Tort.  —  The  insurance 
company  cannot  take  advantage  of  the  laches  of  the  agent 
to  avoid  the  contract.*  And  where  A.  made  out  an  applica- 
tion and  the  agent  copied  it  upon  the  blank  of  another  com- 
pany he  represented,  and  neglected  to  have  A.  sign  it,  the 
company  having  received  several  premiums  was  held  upon 
its  policy  though  the  application  was  never  signed.  An 
agent  who  has  authority  to  bind  his  company  "during  the 
correspondence,"  makes  them  liable  if  without  the  appli- 
cant's fault  he  neglects  to  transmit  the  application  to  them 
till  after  a  loss.^  When  a  policy  of  insurance  after  having 
been  executed  and  sent  to  the  local  agent  for  delivery  is 
returned  to  the  general  agent  for  correction  and  is  practi- 

1  [See  contra,  Miller  v.  Hartford  Fire  Ins.  Co.,  70  Iowa,  704.] 

2  [Galbraitli  v.  Arlington  Ins.  Co.,  12  Bush  (Ky.),  29,  35.] 
^  [Hansen  v.  Amer.  Ins.  Co.,  57  Iowa,  741 J 

*  [Bohninger  v.  Empire  Mut.  Life  Ins.  Co.,  2  T.  &  0.  (N.  Y.)  610,  611.] 
6  [Fish  V.  Cottenet,  44  X.  Y.  538.] 

249 


§  133  E]       INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.         [CH,  VII. 

cally  destroyed  by  him,  —  seals  torn  off,  &c.  —  and  when  he 
refuses  to  return  the  same,  equity  will  relieve  the  insured,  i] 

[§  133  D.  Time  of  acquiring  the  Knowledge  is  immaterial 
if  present,  or  so  late  as  to  be  presumably  present,  in  the 
mind  of  the  agent  at  the  time  he  acts  in  the  business  to 
which  it  relates.  If  one  employed  by  the  agent  to  see  the 
assured  and  get  information  makes  erroneous  returns  in  the 
application,  the  company  is  bound  by  his  acts  and  knowl- 
edge, and  it  is  immaterial  when  such  person  acquired  the 
knowledge  if  it  was  in  his  mind  at  the  time  he  made  the 
statements. 2  It  has  been  held  that  to  affect  a  corporation 
with  knowledge  of  its  director  as  such,  the  knowledge  must 
have  come  to  him  while  acting  officially  in  its  business. ^ 
This  is  not  however  a  correct  statement  of  the  law.  It 
makes  no  difference  when  or  how  the  knowledge  came  to 
him,  if  he  had  it  in  mind  when  he  acted  in  the  company's 
business.  It  would  be  ridiculous  to  hold  that  a  board  of 
directors  might  act  as  though  ignorant  of  a  fact  that  came 
to  them  on  the  street  or  otherwise  before  the  hour  of  board 
meeting.  Where  an  agent  acquires  knowledge  while  acting 
outside  the  business  of  his  agency,  and  so  long  ago  as  not  to 
justify  the  inference  that  he  had  it  in  mind,  it  will  not  affect 
the  company.*] 

[§  133  E.  The  Agent  receiving  Notice  must  be  one  whose 
business  it  is  to  receive  such  notice,  as  the  president  in  re- 
spect to  notice  of  litigation,  or  he  must  be  one  authorized  to 
act  in  the  business  affected  by  the  notice.  The  knowledge 
of  an  agent  in  order  to  bind  the  company  must  be  that  of  an 
agent  authorized  to  bind  the  company  in  relation  to  the 
transaction  to  which  the  knowledge  relates,  and  is  to  oper- 
ate as  a  waiver. °  An  adjuster  is  a.  special  agent  whose 
duties  are  limited  to  ascertaining  and  adjusting  the  loss, 

1  [Chase  V.  Washington,  &c.  Ins.  Co.,  12  BarK  595.] 

2  [.Vlulliu  V.  Vt.  Mut.  Fire  las.  Co.,  58  Vt.  113.] 

8  [Farrel  Foundry  v.  Dart,  26  Conn.  376,  3S3.  In  this  case  the  director  was 
interested  adversely  to  the  company.] 

*  [Stennett  v.  Pa.  Fire  Ins.  Co.,  68  Iowa,  674.] 

c  [Martin  v.  Jersey  City  Ins.  Co.,  44  N.  J.  273  ;  Redstrake  v.  Cumberland  Ins. 
Co.,  44  N.  J.  294.] 

250 


CH.  VII.]  AGENTS. — THEIK   POWERS   AND   DUTIES.  [§  134 

and  knowledge  coming  to  him  of  a  defect  in  the  title  of  the 
assured  is  not  imputable  to  the  company,  and  his  negotia- 
tions after  such  information  do  not  constitute  a  waiver,  i] 

§  133  F.  Criminal  Proceedings.  —  An  agent  may  be  pre- 
sumed to  be  authorized  to  investigate  the  causes  of  a  loss, 
and  to  that  end  to  employ  a  detective;  but  he  cannot  insti- 
tute criminal  proceedings  so  that  his  acts  will  bind  the 
company  unless  specially  thereto  authorized,  as  the  insurers 
have  no  interest  different  in  kind  from  the  general  public 
interest  in  the  punishment  of  the  offender.  ^ 

§  134.  Authority  in  the  Matter  of  Premiums.  —  "Where  the 
agent  is  authorized  to  accept  the  payment  of  premiums,  he 
may  exercise  his  discretion  as  to  the  mode  of  payment.  He 
may,  for  instance,  accept  a  note  or  a  check,  instead  of  the 
money; 3  or  Confederate  States  notes,  while  the  notes  had  a 
value,  and  the  government  had  a  de  facto  existence;*  or,  if 
a  check  is  offered,  his  request  to  let  the  money  lie,  coupled 
■with  a  promise  to  call  for  it  when  he  wants  it,  will  amount 
to  a  waiver,  which  he  has  a  right  to  make,  of  the  condition 
that  the  premium  shall  be  paid  before  the  insurance  shall 
become  binding.^  And  the  same  is  true  whether  a  check  is 
offered  or  not.^  So,  if  the  agent  requests  the  insured  to 
keep  the  money  till  the  policy  arrives,^  or  agrees  to  be  him- 
self responsible  to  the  company  for  the  premium,  accepting 
the  insured  as  his  personal  debtor  for  the  amount,  or  en- 
courages delay. ^     If,  however,  the  insured  is  to  remit  accru- 

1  [Weed  V.  L.  &  L.  Fire  Ins.  Co.,  116  N.  Y.  106.] 

2  Norman  v.  Insurance  Co.,  C.  Ct.  Ill,  Treat,  J.,  4  lus.  L.  J.  827. 

8  Tayloe  y.  Merchants'  Fire  Ins.  Co.,  9  How.  (U.  S.)  390;  Lycoming  Mut. 
Fire  Ins.  Co.  v.  Bedford  (Pa.),  2  Weekly  Notes  of  Cases,  529. 

*  Robinson  v.  International  Life  Assurance  Soc,  42  N.  Y.  (3  Hand)  54. 

5  New  York  Central  Ins.  Co.  v.  National  Prot.  Ins.  Co.,  20  Barb.  (N.  Y.)  468  ; 
Bodine  v.  Exchange  Fire  Ins.  Co.,  51  N.  Y.  117  ;  Southern  Life  Ins.  Co.  v. 
Booker,  9  Heisk.  (Tenn.)  607  ;  ante,  §  62  ;  ^josC,  §  511. 

6  Goit  V.  National  Prot.  Ins.  Co.,  25  Barb.  (N.  Y.)  189. 
■?  Hallock  V.  Commercial  Ins.  Co.,  2  Dutch.  (N.  J.)  268. 

8  Sheldon  v.  Conn.  Mut.  Life  Ins.  Co.,  25  Conn.  207  ;  Bouton  v.  American 
Mut.  Life  Ins.  Co.,  id.  542;  Post  v.  Min&  Ins.  Co.,  43  Barb.  (N.  Y.)  351  ; 
Wooddy  V.  Old  Dominion  Ins.  Co.  (Va.),  9  Ins.  L.  J.  276  ;  Gerlach  v.  Amazon 
Ins.  Go.,  U.  S.  Dist.  Ct.  (Ohio),  4  Ins.  L.  J.  239  ;  Home  Ins.  Co.  v.  Curtis,  32 
Mich.  402;  Mississippi,  &c.  Life  Ins.  Co.  v.  Neyland,  9  Bush  (Ky.),  431  ;  Chick- 

2ol 


§  135]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  VII. 

ing  premiums  direct  to  the  office,  a  promise  of  the  agent, 
who  is  indebted  to  him,  to  pay  them  would  not  inure  to  the 
benefit  of  the  assured.  ^  The  agent  may  also  bind  the  com- 
pany by  his  interpretation  of  the  contract  as  to  the  day 
the  premium  falls  due;  as  that,  when  the  policy  insures 
from  May  29th  to  the  28th  of  the  following  May,  the  annual 
premium  is  due  on  the  29th.2  But  if  the  agent  travels  out 
of  the  usual  course  of  business,  and  receives  a  horse  as  pay- 
ment of  the  premium,  it  will  not  bind  the  insurer,  as  the 
authority  of  the  agent  to  receive  premiums  cannot  be  pre- 
sumed to  extend  to  payments  made  in  an  unusual  manner.^ 
So  if  the  agent  receipts  for  a  policy  on  his  own  life.* 

§  135.  Agent's  Authority  as  to  the  Premium  ;  Broker,  — 
And  upon  a  receipt  for  the  premium,  and  the  actual  pay- 
ment thereof  to  the  local  agent  authorized  by  the  company 
to  make  insurances  binding  upon  them  from  the  date  of  the 
payment  to  him,  provided  they  should  approve  the  rate  of 
premium  charged  and  be  otherwise  satisfied  with  the  risk, 
it  appearing  that  the  rate  charged  was  the  usual  one  for 
that  class  of  risks,  a  bill  in  equity  for  relief,  the  company 
having  heard  of  the  loss  and  refused  to  issue  a  policy,  was 
sustained  on  the  ground  that  the  company  could  not  be  per- 
mitted to  repudiate  the  contract  of  their  agent,  and  arbi- 
trarily refuse  the  risk  because  a  loss  had  intervened.  The 
neglect  of  the  agent  to  forward  the  premium  is  imputable  to 
the  company.^     The  broker  through  whom  the  negotiations 

ering  v.  Globe  Mut.  Life  Ins.  Co.,  116  Mass.  321  ;  Jones  v.  Mtna  Ins.  Co.,  C.  Ct. 
Mass.,  8  Ins.  L.  J.  415  ;  Angell  v.  Hartford  Fire  Ins.  Co.,  59  N.  Y.  171.  But 
contra,  Belleville  Mut.  Ins.  Co.  v.  Van  Winkle,  1  Beasley  (N.  J.),  333  ;  Catoir  v. 
Am.  Life  Ins.  &  Trust  Co.,  33  N.  J.  (4  Vroom)  487.  In  Wall  v.  Home  Ins.  Co., 
8  Bosw.  (N.  Y.  Superior  Ct.)  597,  it  was  held  that  an  agent  for  issuing  policies 
and  receiving  premiums  could  not  waive  a  forfeiture  for  non-payment  of  pre- 
mium. See  also  post,  §  360  et  seq.  ;  Church  v.  LaFayette  Fire  Ins.  Co.,  66  N.  Y. 
222  ;  Peppit  v.  North  British  Ins.  Co.,  1  E.  &  G.  (Nova  Scotia)  219  ;  Dean  v. 
Jltna  Life  Ins.  Co.,  4  N.  Y.  S.  C.  497;  s.  c.  62  N.  Y.  642. 

1  Co-operative  Life  Ass.  v.  McConnico,  53  Miss.  233. 

2  Campbell  v.  Int.  Life  Ass.  Soc,  4  Bosw.  (N.  Y.  Supreme  Ct.)  298. 
8  Hoffman  v.  John  Hancock  Mut.  Life  Ins.  Co.,  92  U.  S.  161. 

*  Neuendorff  u.  World  Mut.  Life  Ins.  Co.  (N.  Y.),  6  Ins.  L.  J.  459. 
s  Perkins  v.  Washington  Ins.  Co.,  4  Cowen   (N.  Y. ),   645,  reversing  s.  c.  6 
Johns.  Ch.  (N.  Y.)  485  ;  ante,  §  60. 

252  s 


CH.  VII.]         AGENTS.  —  THEIR   POWERS   AND    DUTIES.  [§  136 

are  had,  and  who  is  intrusted  with  the  policy  to  be  deliv- 
ered, may  receive  the  premium,  and  bind  the  company, 
though  he  does  not  pay  it  over  to  them,  notwithstanding  a 
condition  of  the  policy  provides  that  the  person  obtaining 
the  policy  shall  be  regarded  as  the  agent  of  the  insured.^ 
And  such  an  agent  may  waive  the  provision  forfeiting  the 
policy  in  case  the  premiums  are  not  paid  before  a  specified 
day. 2  He  may  also  accept  payment  of  the  accruing  pre- 
mium before  it  is  due.^  But  he  cannot,  by  antedating  a 
receipt,  obviate  a  forfeiture  which  his  principal  instructs 
him  not  to  waive.* 

So,  where  an  agreement  was  made  with  an  insurance 
company's  agent  for  insurance,  and  a  receipt  taken  by  the 
insured  for  the  premium,  which  however  was  not  then  paid, 
stating  that  the  insurance  would  take  effect  on  the  day  of  its 
date.  Ten  days  afterwards  the  property  was  burned,  and  on 
the  following  day  the  insured,  without  disclosing  the  fact  of 
the  fire,  paid  the  premium  to  the  agent,  who,  in  ignorance 
of  the  fact  of  loss,  forwarded  the  application  to  the  com- 
pany, together  with  the  premium.  A  policy  was  returned 
in  due  form  to  the  agent,  who,  having  meanwhile  heard  of 
the  loss,  declined  to  deliver  the  policy,  and  tendered  back 
the  premium.  In  an  action  setting  forth  the  above  facts, 
the  plaintiff  was  held  entitled  to  damages  for  the  loss  sus- 
tained, the  contract  being  complete  when  the  policy  was  for- 
warded to  the  agent,  and  taking  effect  from  the  date  of  the 
receipt.^  So  such  an  agent  may  give  permission  to  the  in- 
sured to  remove  the  property  insured  to  another  locality.^ 

§  136.  May  waive  Forfeiture  for  change  of  Residence  or 
non-payment  of  Premium.  —  In  an  action  upon  a  life  policy 
it  appeared  that  the  insured  had,  by  taking  up  his  residence 

1  Lycoming  Fire  Ins.  Co.  v.  Ward,  90  111.  545. 

2  Marcus  v.  St.  Louis  Fire  Ins.  Co.,  68  N.  Y.  625  ;  Dilleber  v.  Knickerbocker 
Life  Ins.  Co.,  76  N.  Y.  567  ;  4  Seld.  (N.  Y.)  351  ;  Sheldon  v.  Atlantic  Fire  Ina 
Co.,  26  N.  Y.  460.     But  see  Critchett  v.  American  Ins.  Co.,  9  Ins.  L.  J.  594. 

8  Eclectic  Life  Ins.  Co.  v.  Fahrenkrug,  68  111.  463. 

*  Diboll  V.  ^tna  Life  Ins.  Co.  (La.),  9  Ins.  L.  J.  827. 

B  Whitaker  v.  Farmers'  Union  Fire  Ins.  Co.,  29  Barb.  (N.  Y.)  312. 

«  New  England  Fire  &  Mar.  Ins.  Co.  v.  Schettler,  38  111.  166. 

253 


§  136]  INSURANCE  :   FIRE,   LIFE,   ACCIDENT,   ETC.         [CH.  VII. 

abroad,  violated  a  provision  of  the  policy  which  made  it  void 
if  the  assured  without  license  from  the  insurers  should  go 
beyond  the  limits  of  Europe.  The  insured,  however,  noti- 
fied the  local  agent  of  the  insurers,  at  the  place  where  he 
effected  the  insurance  origina-lly,  of  his  change  of  residence, 
and  asked  before  he  paid  any  further  premiums  if  such 
change  would  vitiate  his  policy,  to  which  the  agent  replied 
that  it  would  not  if  the  premiums  were  regularly  paid. 
Thereupon  the  premiums  were  paid,  and  continued  to  be 
paid  regularly  for  several  years,  to  the  local  agent  and  his 
successor,  who  had  knowledge  of  the  facts;  but  neither  of 
the  agents  informed  his  principal  of  the  change  of  residence, 
though  regularly  forwarding  the  premiums  as  received.  It 
was  contended  that  the  agent  was  acting  beyond  the  scope 
of  his  authority  in  assuring  the  insured  that  such  change  of 
residence  would  not  invalidate  the  policy  if  the  premiums 
continued  to  be  paid,  and  that  the  notice  of  the  change  to 
the  agents  was  not  notice  to  their  principal.  But  the  court 
said  that  the  party  paid  and  the  agent  received  the  premiums 
upon  the  faith  and  condition  that  the  policy  was  to  be  con- 
sidered valid  and  subsisting;  that  as  the  agents  were  duly 
constituted  for  the  purpose  of  receiving  premiums  as  well  as 
for  other  purposes,  it  was  their  duty,  and  not  that  of  the 
insured,  to  communicate  to  the  home  office  the  circumstances 
under  which  these  premiums  had  been  paid,  and  the  repre- 
sentations, terms,  and  conditions  under  which  they  were 
paid ;  that  the  insurers  must  be  deemed  to  have  constructive 
notice  of  the  change  of  residence,  and  that  upon  the  pay- 
ment and  receipt  of  the  premiums  by  them  they  became  as 
much  bound  as  if  the  premiums  had  been  paid  directly  at 
the  home  office,  and  had  been  received  there  with  a  full 
knowledge  of  the  change  of  residence  of  the  insured. ^  He 
may  also  waive  the  provision  for  forfeiture  for  non-payment 


*  Wing  V.  Harvey,  27  Eng.  L.  &  Eq.  140,  141.  See  also  Miner  v.  Phoenix  Ins. 
Co.,  27  Wis.  693;  Supple  v.  Cann,  9  I.  L.  R.  o.  s. ;  Gloucester  Manuf.  Co.  v. 
Howard  Fire  Ins.  Co.,  5  Gray  (Mass.),  497  ;  Hodsdon  v.  Guard.  Life  Ins.  Co.,  97 
Mass.  144  ;  North  Berwick  Co.  v.  N.  E.  Fire  &  Mar.  Ins.  Co.,  52  Me.  336  ;  Walsh 
0.  Mtna.  Life  Ins.  Co.,  30  Iowa,  133. 

25-4 


CH.  VII.]  AGENTS.  —  THEIR   POWERS   AND   DUTIES.  [§  137 

of  premium  before  the  premium  becomes  due.^  In  Acie  v. 
Fernie,^  it  was  held  that  an  agent  to  collect  premiums  could 
not,  by  accepting  a  premium  after  forfeiture  of  the  policy 
for  non-payment,  bind  the  company  so  as  to  waive  the  for- 
feiture, although  the  company  had  charged  the  agent  with 
the  amount  of  the  premium  on  account,  in  accordance  with 
an  understanding  that  this  should  be  done  at  the  expiration 
of  fifteen  days  after  the  premium  became  due.  But  the 
weight  of  authority  seems  to  be  the  other  way.^  [The  secre- 
tary of  an  insurance  company  may  waive  the  breach  of  a 
condition  in  the  policy.*] 

[§  136  A.  An  agent  cannot  ratify  or  make  good  a  contract 
that  never  had  any  valid  existence,  as  by  reason  of  fraud  ah 
initio,  although  he  receives  premiums  after  knowledge  of  the 
facts.^  A  mere  book-keeper  who  has  no  power  to  receive  an 
overdue  premium  cannot  bind  the  company  by  so  doing. ^] 

§  137.  Limitation  of  Agent's  Authority  by  Terms  of  Policy. 
—  Of  course,  if  the  insured  stipulate  in  his  application  that 
the  insurer  shall  not  be  bound  by  any  act  done  or  statement 
made  to  or  by  the  agent,  not  contained  in  the  application,  he 
cannot  shelter  himself  under  a  plea  of  equitable  estoppel,  by 
reason  of  the  agent's  fraud  or  negligence.  The  knowledge 
by  the  agent  of  a  fact  not  stated  in  the  application  in  that 
case  becomes  entirely  immaterial,  unless  possibly  when  the 
statement  of  the  fact  may  have  been  fraudulently  prevented 
by  the  agent.  ^  (a)     And  equally,   of  course,  such  a  general 

i  Marcus  v.  St.  Louis  Mut.  Life  Ins.  Co.,  68  N.  Y.  625. 

2  7  Mees.  &  Wels.  151. 

3  Ante,  §§  134,  135. 

*  [Haas  V.  Montauk  Fire  Ins.  Co.,  49  Hun,  272.] 

s  [Swett  V.  Citizens'  Mut.  Relief  Soc,  78  Me.  541,  545  {dictum).'] 

6  [Nashville  Life  Ins.  Co.  v.  Ewing,  58  Tenn.  305,  309.] 

7  Shawmut  Mut.  Fire  Ins.  Co.  v.  Stevens,  9  Allen  (Mass.),  332;  Chase  v. 
Hamilton  Ins.  Co.,  20  N.  Y.  (6  Smith)  52  ;  Loehner  v.  Home  Mut.  Ins.  Co.,  17 
Mo.  (2  Bennett)  247  ;  Bleakley  v.  Niagara  Dist.  Mut.  Fire  Ins.  Co.,  16  Gr.  Ch. 
(U.  C.)  198.  These  cases  are  distinguished  from  Plumb  v.  Cattaraugus  Co.  Mut. 
Ins.  Co.,  18  N.  Y.  (4  Smith)  392,  and  similar  cases  before  cited,  ante,  §  132.  In 
that  case  there  was  no  such  stipulation. 

(a)  See  New  York  L.  Ins.  Co.  v.  Dwelling-House  Ins.  Co.,  75  Mo  App. 
Fletcher,  117  U.  S.  519,  530;  Wolf  t;.     337. 

255 


§  137]         insurance:  fire,  life,  accident,  etc       [oh.  vii. 

ao-ent  has  no  power  to  bind  the  company  in  a  case  where, 
had  all  the  facts  transpired  without  the  intervention  of  an 
ao-ent,  the  company  would  not  be  bound.  Thus,  where  a 
proposal  was  received  on  the  morning  after  a  fire,  informa- 
tion of  which  reached  the  agent  in  the  afternoon,  who  on  the 
following  day  countersigned  and  delivered  a  policy,  it  was 
held  that  the  policy  was  invalid,  as  there  was  no  contract  to 
insure  prior  to  the  loss,  the  proposal  not  then  having  been 
accepted,  nor  even  received.  ^  Nor  can  such  an  agent  make 
a  contract,  in  which  he  himself  has  an  interest,  valid  against 
the  company; 2  nor,  where  he  assigns  his  own  policy,  accept 
notice  of  the  assignment.  ^  (a)  And  as  there  is  no  legal  pre- 
sumption that  offices  clothe  their  agents  with  power  to  fix 
the  terms  of,  or  perfect,  the  contract,  and  as  the  question  of 
the  agents'  authority  is  always  one  of  fact,  it  is  always  ad- 
visable in  treating  with  them  to  resolve  all  doubts  as  to 
their  powers  against  their  authority.  A  company  may  even 
allow  its  agent  to  advertise  his  office  as  a  "branch  office;" 
yet  if  the  application  shows  that  the  policy  is  to  be  issued 
at  the  home  office,  and  the  premium  is  to  be  paid  when  the 
policy  is  presented  to  the  applicant,  a  receipt  for  the  pre- 
mium, signed  by  the  agent,  and  delivered  when  the  applica- 
tion is  forwarded  to  the  company,  will  not  fix  the  liability 
of  the  latter,  although  it  recites  that  the  money  received  is 
"for  insurance."  4  So,  if  by  the  terms  of  the  policy  overdue 
premiums  can  only  be  paid  on  the  company's  receipt,  with 
which  he  is  supplied,  the  agent's  own  receipt  is  not  binding 
upon  the  company;^  yet  if,  having  power  only  under  the 

1  Bentley  v.  Columbia  Ins.  Co.,  17  N.  Y.  (3  Smith)  421. 
a  Ibid. 

8  Ex  parte  Hennesse}',  1  Con.  &  Law.  559. 

*  Linford  v.  Provincial  Horse  &  Cattle  Ins.  Co.,  10  Jur.  N.  s.  1066. 
6  Bissell  V.  Am.  Life  Ins.  Co.,  Ct.  of  Com.  Pleas,  Lucas  Co.  (Pa.),  2  Big.  Life 
&  Ace.  Ins.  Cases,  150  ;  ante,  §  126. 

(a)  The  secretary   of  an  insurance  its    general    agent.       Zimmerman     i'. 

company  cannot  approve  his  own  appli-  Dwelling-House     Ins.    Co.,    110    Mich, 

cation  for   insurance  in  his   company.  399.     Nor  can  an  agent  issue  a  valid 

Pratt  V.  Dwelling-House  M.  F.  Ins.  Co.,  policy  to  a  corporation  of  which  he  is  a 

130  N.  Y.   206.     An  agent  cannot  in-  stock-holder   and  officer,  but  such  act 

sure  his  own  property  without  notice  to  may  be  ratified.     Greenwood  Ice  Co.  v. 

the  companv,  even  with  the  consent  of  Georgia  Home  Ins.  Co.,  72  Miss.  46. 

256 


CH.  VII.j  AGENTS.  —  THEIR   POWEBS   AND   DUTIES.         [§  137  A 

direction  of  a  committee  to  settle  losses,  he  is  in  the  habit 
of  paying  them  by  drafts  on  his  principals,  and  it  appears 
that  the  drafts  have  been  honored,  his  authority  to  make  the 
drafts  will  be  presumed.  ^ 

[§  137  A.  Restrictions  in  Policy.  —  A  local  agent  with 
power  to  receive  premiums  and  issue  policies  has  no  author- 
ity to  waive  the  condition  requiring  written  assent  of  the 
company  to  any  change  increasing  the  risk,^  or  to  a  re- 
moval. ^  Where  the  agent  knowing  that  the  property  was  a 
saloon  insured  it,  and  the  policy  stated  that  the  company  did 
not  take  such  risks,  the  company  was  held  not  liable.*  And 
it  has  been  held  that  where  the  policy  expressly  stipulates 
that  the  company  shall  not  be  bound  by  any  act  or  statement 
not  contained  in  the  written  application,  or  indorsed  on  the 
policy,  notice  to  the  agent  of  other  matters  will  not  affect 
the  company.^  An  agent  cannot  waive  non-payment  of  a 
premium  note  if  the  policy  expressly  declares  that  he  shall 
not  alter  nor  vary  the  contract.  ^  Where  the  policy  recites 
that  "agents  of  the  company  are  not  authorized  to  make, 
alter,  or  discharge  contracts,"  an  agreement  of  the  agent 
with  the  insured,  contemporaneous  with  the  delivery  of  the 
policy,  cannot  alter  its  terms.'  When  a  premium  note 
promises  to  pay  a  certain  sum  in  such  portions,  and  at  such 
times  as  the  directors  may  agreeably  to  the  act  of  incorpora- 
tion require,  and  the  application  agreed  that  the  company  is 
not  to  be  bound  by  any  act  or  statement  of  its  agent  varying 
the  written  or  printed  contract,  unless  inserted  in  the  appli- 
cation, oral  evidence  cannot  be  received  to  show  a  represen- 
tation of  the  general  agent  that  he  had  made  a  special  and 
different  arrangement  with  the  company  for  the  plaintiff.^ 

1  Fayles  v.  National  Ins.  Co.,  49  Mo.  380. 

2  [Kyte'v.  Commercial  Union  Assurance  Co.,  144  Mass.  43.] 
s  [Putnam  Tool  Co.  v.  Fitchburg  Ins.  Co.,  145  Ma.ss.  265.] 

*  [Mensing  v.  Amer.  Ins.  Co.,  36  Mo.  App.  602.] 

«  [Enos  V.  Sun  Ins.  Co.,  67  Cal.  621.] 

6  [Mclntyre  v.  Mich.  State  Ins.  Co.,  52  Mich.  188,  194.] 

■^  [Greenwood  v.  N.  Y.  Life  Ins.  Co.,  27  Mo.  App.  401,  412  (agreement  as  to 
place  of  paying  premiums).  See  also  Dircks  v.  German  Ins.  Co.,  34  Mo.  App. 
31.] 

8  [Lycoming  Fire  Ins.  Co.  v.  Langley,  62  Md.  196.] 

VOL.  I.  —  17  257 


§  137  A"]      INSURANCE  :    FIRE,  LIFE,   ACCIDENT,   ETC.         [CH.  VII. 

When  the  policy  provides  that  waiver  can  only  be  made  at 
the  head  office,  and  by  the  directors,  then  the  agent  cannot 
waive.  The  true  rule  is  that  the  powers  of  a  general  agent 
are  prima  facie  co-extensive  with  the  business  intrusted  to 
his  care,  and  will  not  be  narrowed  by  limitations  not  com- 
municated to  the  person  with  whom  he  deals.  "  The  rule  could 
not  go  further  without  violating  all  reason  and  justice." 
But  in  such  a  case  as  the  one  before  us  the  assured  had 
notice  of  the  restriction  on  the  face  of  his  policy.^  It  seems 
very  doubtful  if  the  doctrine  of  these  cases  is  entirely  cor- 
rect. The  assured  has  a  right  to  suppose  that  a  general 
agent  has  all  the  powers  ordinarily  incident  to  his  business, 
unless  he  has  knowledge  to  the  contrary,  and  usage  may 
overcome  the  provisions  of  a  policy.  In  regard  to  waivers 
before  issue  it  is  by  no  means  clear  that  the  constructive 
notice  supplied  by  provisions  of  a  policy  not  yet  in  the 
hands  of  the  applicant  should  be  held  binding  upon  him.  (d) 
Prudent  men  are  accustomed  to  rely  on  the  acts  and  state- 
ments of  the  agent,  and  they  should  be  protected  in  so  do- 
ing. Busy  men  have  not  time  to  study  the  interminable 
provisions  of  insurance  policies.  Only  when  the  custom  of 
limiting  the  authority  of  a  general  agent  in  the  policy  has 
become  so  general  that  it  is  a  part  of  the  ordinary  business 
knowledge  of  the  world  that  such  provisions  exist  and  are 
to  be  examined,  will  it  be  proper  to  hold  the  applicant  bound 
by  them  in  respect  to  negotiations  prior  to  the  issue  of  the 
policy.  As  to  waivers  taking  place  after  issue,  it  is  very 
proper  to  require  the  assured  to  look  at  his  policy  and  con- 
form to  it,  and  limitations  of  the  agent's  authority  should 
be  effective,  unless  by  a  course  of  business  or  otherwise  the 

1  [Marvin  v.  Universal  Life  Ins.  Co.,  85  N.  Y.  278,  283.] 

(a)  Restrictions  inserted  in  the  policy  edge  of  all  the  facts  and  of  the  actual 

upon  the  agent's  power  to   waive  any  situation.     Wood  v.  American  Fire  Ins. 

conditions  unless  done  in  a  particular  Co.,   149  N.  Y.  382,  386  ;  Bobbins  v. 

manner,   are   not  deemed  to   apply   to  Springfield  F.  &  M.  Ins.  Co.,  id.  477  ; 

those  conditions  which  relate  to  the  in-  McElroy  v.  British  Noiih  America  Ass. 

caption  of  the  contract,  when  it  appears  Co.,   94   Fed.  Rep.   990,   994;    United 

that  the  agent  has  delivered  it  and  re-  Firemen's  Ins.  Co.  v.  Thomas,  27  C.  C. 

ceived  the  premiums  with  full  knowl-  A.  42,  46,  and  note. 

258 


CH.  VII.]  AGENTS.  —  THEIE   POWERS   AND    DUTIES.  [§   138 

company  has  waived  the  limitation  on  the  agent's  power  of 
waiver. 

There  is  good  authority  for  this  view.^  Good  judges  have 
seen  fit  to  rule  that  a  general  agent  of  an  insurance  company 
may  by  parol  waive  the  performance  of  a  condition  inserted 
in  the  policy  for  the  benefit  of  the  company,  though  the  lat- 
ter expressly  declares  that  nothing  but  a  written  agreement, 
signed  by  an  officer  of  the  company,  shall  have  that  effect ;  ^ 
and  there  is  an  Ohio  case  to  the  effect  that  although  a  life 
policy  contains  notice  that  the  agent  has  no  authority  to 
waive  a  failure  to  pay  premium,  yet  the  course  of  business 
may  warrant  the  insured  in  relying  on  such  waiver. ^J 

§  138.  Authority  after  Negotiations  are  concluded.  —  Un- 
less expressly  delegated  or  sanctioned  by  known  and  per- 
mitted usage,  the  power  of  moulding  the  terms  of  the 
contract  does  not  extend  to  dealing  with  facts  and  circum- 
stances arising  after  the  contract  has  been  perfected.  And 
it  behooves  the  applicant  for  insurance,  unless  he  has  the 
most  satisfactory  evidence  that  the  agent  with  whom  he  is 
negotiating  has  general  and  unrestricted  powers  *  to  examine 
carefully  into  the  extent  of  his  authority;  for  the  law  holds 
him  bound  to  know,  nut  only  whether  the  agent  is  a  general 
or  special  one,  but,  if  special,  what  are  the  limitations  upon 
his  authority.^  If  it  were  not  so,  there  would  be  no  distinc- 
tion between  a""  general  and  a  special  agent,  and  all  restric- 
tions and  limitations  on  an  agent's  authority  would  be 
nugatory.  A  principal  would  in  all  cases  be  at  the  mercy 
of  his  agent,  however  carefully  he  might  have  restricted  his 
authority.  An  agent  therefore  to  receive  and  forward  appli- 
cations, to  countersign  policies,  to  collect  premiums,  and 
bind  the  company  on  special  hazards  for  ten  days,  is  not  the 
agent  of  the  company  to  receive  notice,  and  fix  additional 
premium  affecting  its  rights  under  a  policy  already  issued; 
as  where  the  policy  provides  that  when  premises  are  vacated 

1  [See  §  139.] 

2  [Van  Allen  v.  Farmers'  Joint  Stock  Ins.  Co.,  4  Hun,  413.] 
8  [Insurance  Co.  v.  Tullidge,  89  Ohio  St.  240.] 

*  See  as  to  these,  post,  §  151  e<  seg. 

6  Equitable  Life  Ins.  Soc.  v.  Poe  (Md.),  9  Ins.  L.  J.  871. 

259 


§  138  A]      INSURANCE :    FIRE,    LIFE,    ACCIDENT,    ETC.         [CH.  VII. 


the  policy  shall  be  void  unless  immediate  notice  be  given  to 
the  company  and  an  additional  premium  paid.^  Nor  has  an 
a<Tent  to  procure  insurance  power  to  cancel.^  So,  though 
the  agent  have  power  to  adjust  losses  he  cannot  waive  a  for- 
feiture,^ or  proofs  of  loss.^  (a)  [A  mere  soliciting  agent,  one 
not  furnished  with  blank  policies  to  fill  and  issue,  has  no 
power  to  consent  to  the  assignment  of  a  policy.^] 

[§  188  A.  Proof  of  Agency.  —  It  must  be  shown  that  the 
agent  of  the  insurance  company  was  authorized  (or  held  out 
to  be)  to  make  insurance  contracts,  in  order  to  recover  on  a 

1  Hanisou  v.  City  Fire  Ins.  Co.,  9  Allen  (Mass.)  231. 

2  Rothschild  v.  Am.  Cent.  Ins.  Co.,  5  Mo.  App.  596, 

3  Phcenix  Ins.  Co.  v.  Lawrence  et  al.,  4  Met.  (Ky.)  9  ;  Tate  v.  Citizens'  Mut. 
Ins.  Co.,  13  Gray  (Mass.),  79,  and  see  post,  §  145.  See  also  Bartholomew  v. 
Merchants'  Ins.  Co.,  25  Iowa,  507. 

*  Van  Allen  v.  Farmers',  &c.  Ins.  Co.,  64  N.  Y.  469  ;  Merserau  v.   Phoenix 
Ins.  Co.,  66  N.  Y.  274  ;  Bush  v.  Westchester  Ins.  Co.,  63  N.  Y.  53L 
s  [Strickland  v.  Council  Bluffs  Ins.  Co.,  66  Iowa,  466.] 


(«)  An  adjuster,  who  is  sent  by  the 
insurer's  general  agent  to  settle  and  ad- 
just a  loss  by  fire  on  behalf  of  the  com- 
pany, may  waive  the  proofs  of  loss 
which  were  required  by  the  policy. 
Wholley  v.  Western  Ass.  Co.,  174  Mass. 
263  ;  Searle  v.  Dwelling-House  Ins.  Co., 
152  Mass.  263  ;  Richards  v.  Continen- 
tal Ins.  Co.,  83  Mich.  508  ;  Graves  v. 
Merchants'  &  Bankers'  Ins.  Co.,  82 
Iowa,  637  ;  Brown  v.  State  Ins.  Co., 
74  id.  428  ;  Hartford  Ins.  Co.  v.  Keat- 
ing, 86  Md.  130 ;  Davidson  i;.  Guar- 
dian Assurance  Co.,  176  Penn.  St.  525  ; 
Gould  V.  Dwelling-House  Ins.  Co., 
134  id.  570  ;  Perry  v.  Dwelling-House 
Ins.  Co.,  67  N.  H.  291  ;  Cooper  v.  Ins. 
Co.  of  Pennsylvania,  96  Wis.  362  ;  Osh- 
kosh  Gaslight  Co.  V.  Germania  Ins.  Co., 
71  Wis.  454;  Dick  v.  Equitable  F.  & 
M.  Ins.  Co.,  92  id.  46 ;  Mitchell  v. 
Minnesota  F.  Ass'n.,  48  Minn.  278  ; 
McCollum  V.  Liverpool,  London  &  Globe 
Ins.  Co.,  67  Mo.  App.  66  ;  Grubbs  v. 
North  Carolina  Home  Ins.  Co.,  108 
N.  C.  472 ;  Indiana  Ins.  Co.  v.  Capehart, 
108  Ind.  270  ;  yEtna  Ins.  Co.  v.  Shryer, 
85  id.  362  ;  Perry  v.  Faneuil  Hall  Ins. 
Co.,    11    Fed.  Rep.  482 ;    Mitchell  v. 

260 


Orient  Ins.  Co.,  40  111.  App.  Ill  ;  Mc- 
Pike  V.  Western  Assurance  Co.,  61 
Miss.  37;  New  Orleans  Ins.  Co.  v.  Mat- 
thews, 65  id.  301.  See  contra,  Home 
Ins.  Co.  V.  Sorsby,  60  Miss.  302  ;  HoUis 
V.  State  Ins.  Co.,  65  Iowa,  454  ;  Everett 
V.  London  &  Lancashire  Ins.  Co.,  142 
Penn.  St.  332.  If  the  insured  demands 
payment  of  a  loss,  and  is  referred  to  the 
adjuster  as  having  authority  to  settle, 
and  he  demands  vouchers  and  other 
proofs  which  cannot  be  furnished  within 
the  twelve  months'  limitation,  he  has 
implied  authority  to,  and  may,  by  his 
conduct,  waive  the  limitation,  notwith- 
standing a  policy  provision  that  no 
officer  or  agent  shall  be  held  to  have 
waived  any  stipulation  without  indorse- 
ment in  writing.  Dibbrell  v.  Georgia 
Home  Ins.  Co.,  110  N.  C.  193.  Where 
an  adjuster  was  sent  by  the  company, 
who  took  a  sworn  detailed  statement 
regarding  the  loss,  substantially  similar 
to  that  required  in  the  ordinary  proofs, 
and  declared  himself  satisfied,  this  was 
held  to  be  a  waiver  of  a  subsequent  de- 
mand for  further  proofs  by  the  com- 
pany. Graves  v.  Merchants'  &  Bankers' 
Ins.  Co.,  82  Iowa,  637. 


CH.  VII.]  AGENTS.  —  THEIR   POWERS   AND   DUTIES.         [§  138  B 

policy  issued  by  him.^  The  secretary  of  the  company  can- 
not be  asked  "What  was  the  authority  of  a  certain  agent 
J.  ?  "  The  proper  method  of  proving  his  authority  is  by  the 
production  of  his  power  of  attorney,  or  a  resolution  of  the 
board  of  directors. ^  This,  however,  is  not  necessary.  It  is 
sufficient  proof  of  the  agency  of  A.  that  the  insurer  has  been 
accustomed  to  pay  policies  subscribed  by  him,  without  pro- 
ducing a  written  power  of  attorney  which  it  is  stated  by  the 
agent  that  he  has.^  Where  the  plaintiff  made  application 
to  the  D.  company  through  A.,  supposing  him  to  be  the 
agent  of  D.,  and  the  company  received  the  application  and 
the  premium  and  issued  the  policy  through  A.,  the  facts 
were  held  sufficient  as  a  recognition  of  the  assumed  agency.* 
The  declarations  of  an  agent  are  never  evidence  of  his 
authority.^  In  Illinois  a  penalty  is  provided  against  agents 
of  foreign  insurance  companies  acting  without  a  certificate 
from  the  auditor.^] 

[§  138  B.  Company  v.  Agent.  — Where  an  insurance  com- 
pany issues  a  policy  on  a  hotel  which  is  unoccupied,  and 
this  fact  is  known  to  the  agent  but  not  communicated  to 
the  company,  the  latter,  having  to  pay  a  loss  by  burning 
before  occupancy,  can  only  recover  nominal  damages  of  the 
agent,  unless  the  premium  received  were  less  than  that  usu- 
ally charged  for  the  risk  actually  taken  (the  company  being 
in  the  habit  of  taking  such  risks),  and  then  the  agent  would 
be  liable  for  the  difference  of  premium.'^  Where  an  insur- 
ance company  makes  an  agreement  for  the  services  of  an 
agent  for  a  specified  term,  and  before  the  term  is  expired 
the  company  is  restrained  from  doing  business  by  order  of 
the  court,  the  agent  has  no  claim  on  the  funds  in  the  hands 
of  the  receiver  on  account  of  the  breach  of  the  contract  with 


1  [Fleming  v.  Hartford  Fire  Ins.  Co.,  42  Wis.  616,  621.] 

2  [Benninghoff  v.  Agricultural  Ins.  Co.,  93  N.  Y.  495.] 

3  [Haughton  v.  Ewbaiik,    4  Camp.  88;  Goodson  v.  Brooke,  4  Camp.   163; 
Neal  V.  Erving,  1  Esp.  61.] 

*  [Packard  v.  Dorchester  Mut.  Fire  Ins.  Co.,  77  Me.  144.] 

6  [James  v.  Stookey,  1  Wash.  330,  331.] 

6  [Pierce  v.  The  People,  106  111.  11.] 

'  [State  Ins.  Co.  v.  Richmond,  71  Iowa,  519,  523-525.] 

261 


§  139]  INSURANCE  :    FIRE,  LIFE,   ACCIDENT,   ETC.         [cH.  VII. 

him  at  least  in  the  absence  of  evidence  that  it  was  some 
fault  of  the  company  which  induced  the  superintendent  of 
insurance  to  make  the  certificate  upon  which  the  attorncy- 
o-eneral  acted. ^  Where  an  order  from  the  principal  to  the 
ao-ent  is  capable  of  different  interpretations  and  the  agent 
honestly  adopts  one  and  follows  it,  the  principal  is  bound, 
and  the  agent  exonerated.  ^  In  this  case  the  company  sent 
an  "expiration  sheet"  to  F.,  the  agent,  with  the  word 
"  drop  "  opposite  a  certain  policy ;  the  company  meant  that 
the  property  indicated  should  not  be  again  insured,  but  the 
agent  understood  simply  that  the  amount  insured  upon  it 
was  to  be  less,  and  agreed  to  insure  it  for  half  the  former 
risk,  and  the  agreement  was  sustained. 

[§  138  C.  Cessation  of  the  Agency.  —  The  agency  ceases 
when  the  company  goes  out  of  business.^  When  no  notice 
of  the  fact  that  the  agent  through  whom  the  policy  had  been 
effected  had  ceased  to  be  agent  for  that  branch  of  the  com- 
pany's business,  had  been  given  the  assured,  proofs  fur- 
nished to  him  are  sufficient  proofs  of  loss.*  A  promise  to 
renew  in  a  company  that  had  ceased  to  do  business,  and  by 
one  whose  authority  as  agent  had  been  revoked,  cannot  bind 
the  company,  though  it  may  be  a  cause  of  action  against  the 
pretended  agent  if  the  plaintiff  did  not  know  of  the  revoca- 
tion.^ Taking  out  annual  licenses  in  the  names  of  agents 
does  not  give  them  a  vested  right  to  hold  the  agency  until 
the  close  of  the  year.^] 

§  139.  Mutual  Insurance  Agents.  —  Substantially  the  same 
general  principles  have  been  applied  in  most  of  the  courts 
in  this  country  ^  in  reference  to  agencies  of  mutual  insurance 

1  [People  V.  Globe  Mut.  Life  Ins.  Co.,  91  N.  Y.  174,  179,  181.  It  seems  also 
that,  whntever  the  cause  of  dissolution,  it  is  the  act  of  the  State  and  not  that  of 
the  company,  and  that  the  agent  so  contracting  takes  the  risk  of  any  act  or  neg- 
lect of  the  other  officers  of  the  company  that  may  cause  dissolution.] 

2  [Winne  v.  Niagara  Fire  Ins.  Co.,  91  N.  Y.  185.] 

3  [Insurance  Co.  v.  Williams,  91  N.  C.  69.] 

4  [Marsden  v.  City  &  County  Ass.  Co.,  1  L.  R.  C.  P.  232,  239.] 
s  [Montross  v.  Roger  Williams  Ins.  Co.,  49  Mich.  477.] 

6  [Davis  V.  Niagara  Fire  Ins.  Co.,  12  Fed.  Rep.  281  ;  11  Biss.  592  (111.)  1882  ; 
11  Ins.  L.  J.  592.] 

^  Mutual  fire  insurance  seems  not  to  have  had  much  vogue  in  England.  The 
courts  of  Massachusetts,  and  to  some  extent  those  of  Rhode  Island,  Pennsylvania, 

'     262 


CH.  YII.]         AGENTS.  —  THEIR   POWERS   AND   DUTIES.  [§  139 

companies,  which  we  have  seen  have  been  applied  to  agen- 
cies of  stock,  or,  as  they  are  sometimes  called,  proprietary 
companies,  upon  the  general  ground  that  incorporated  com- 
panies, as  well  mutual  as  others,  when  business  is  neces- 
sarily conducted  through  agents,  should  be  required  to  see 
that  their  officers  and  agents  not  only  know  what  their 
powers  and  duties  are,  but  that  they  do  not  habitually  and 
upon  system  transcend  those  powers,  else  third  persons  who 
have  no  means  of  access  to  the  by-laws  and  resolutions  which 
govern  the  body  corporate,  and  no  means  of  judging  in  the 
particular  instance  whether  the  officer  is  or  is  not  transcend- 
ing his  powers,  cannot  deal  with  them  with  any  degree  of 
safety.  A  mutual  insurance  company,  for  instance,  whose 
rules  prohibit  the  assignment  of  a  policy,  "unless  by  the 
consent  of  the  company,  manifested  in  writing,"  but  whose 
uniform  practice  has  been  to  signify  that  consent  by  an  in- 
dorsement thereof  on  the  policy,  signed  by  the  secretary, 
without  any  formal  note  or  direction  with  reference  to  the 
matter,  will  not  be  permitted  to  deny  that  such  is  a  consent 
of  the  company.  They  must  be  held  responsible,  as  against 
strangers  at  least,  on  the  ground  of  a  tacit  assent  and  ap- 
proval, for  the  known  act  of  their  secretary.  It  might  be 
different  if  the  act  were  of  such  a  nature  that  by  strict  vigi- 
lance and  scrutiny  it  could  not  be  known,  and  was  not  in  fact 
known.  1  So  the  consent  of  an  agent  to  further  insurance 
indorsed  on  the  policy,  such  being  shown  to  be  his  practice 
known  to  the  company,  is  equivalent  to  the  consent  of  the 
directors  subscribed  by  the  secretary,  required  by  a  provi- 
sion of  the  charter  of  the  company. ^  And  any  customary 
exercise  of  authority  known  to  the  principal,  and  not  repu- 
diated, will  bind  the  principal. ^  [The  secretary  of  a  mutual 
company  may  give  the  assent  of  the  directors  as  their  agent.  ^ 

and  New  Jersey,  hold  that  agents  of  mutual  insurauce  companies  have  less  exten- 
sive powers.     See  'post,  §  1-45  et  scq. 

1  Conover  v.  The  Mut.  Ins.  Co.  of  Albany,  1  Comst.  (N.  Y.)   290,  affirming 
s.  c.  3  Denio  (N.  Y.),  254. 

2  Peck  V.  New  London  Co.  Mut.  Fire  Ins.  Co.,  22  Conn.  575. 

3  Brockelbank  v.  Sugrue,  5  C.  &  P.  21. 

*  [Durar  v.  Hudson  Ins.  Co.,  24  N.  J.  L.  171,  196.] 

263 


^  140]  INSURANCE  :   FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  VII. 

The  directors  of  a  mutual  company  may  appoint  the  presi- 
dent to  act  for  them  as  to  indorsements. i] 

§  140.  Agent  of  Company  not  necessarily  Agent  of  Appli- 
cant, though  made  so  by  a  By-law  of  the  Company.  —  The 
local  agent  of  a  mutual  insurance  company  authorized  to 
receive  and  forward  applications  is  not  necessarily  the  agent 
of  the  applicant  also,  though  it  be  so  provided  by  the  by- 
laws, or  so  stipulated  in  the  policy.  Such  a  stipulation  does 
not  convert  acts  done  for  and  in  behalf  of  the  insurers,  and 
without  the  authority  of  the  insured,  into  acts  by  which  the 
latter  is  bound.  When  a  person  is  in  fact  the  agent  of  the 
insurer  in  procuring  a  policy,  a  clause  in  the  policy  that 
persons  so  acting  are  agents  of  the  insured,  and  not  of  the 
insurer,  does  not  change  the  fact.  He  is  still  the  agent  of 
the  company  as  to  the  acts  which  are  done  in  its  behalf.  ^ 
And  if  at  the  time  of  the  application  the  latter  states  facts 
material  to  the  risk,  and  the  agent  neglects  to  communicate 
them  to  the  company,  in  consequence  of  which  a  policy  is 
issued  in  ignorance  of  the  fact,  the  neglect  is  not  imputable 
to  the  applicant  so  as  to  make  him  responsible  as  for  a  con- 
cealment. That  the  agent  is  instructed  to  regard  himself 
as  the  agent  of  the  applicant  rather  than  of  the  company, 
these  instructions  not  being  known  to  the  applicant,  does 
not  alter  the  case.^  And  an  agent  duly  appointed  by  the 
local  agent,  in  pursuance  of  a  custom  known  to  and  approved 
by  the  company,  to  solicit  and  forward  to  him  applications 

1  [Topping  V.  Bickford,  4  Allen,  120,  121.] 

2  Commercial  Ins.  Co.  v.  Ives,  56  111.  402  ;  Bassell  v.  American  Fire  Ins.  Co., 
2  Hughes  (C.  Ct.),  531  ;  Union  Ins.  Co.  v.  Chipp,  93  111.  96  ;  Eilenberger  v.  Pro- 
tective Ins.  Co.  (Pa.),  89  Pa.  St.  464  ;  Andes  Ins.  Co.  v.  Loehr,  C.  C.  P.  N.  Y. 
City,  4  Ins.  L.  J.  465  ;  Planters'  Ins.  Co.  v.  Myers,  55  Miss.  479  ;  Farmers'  Ins. 
Co.  V.  Munn,  App.  Ct.  of  111.,  First  Dist.,  9  Ins.  L.  J.  159.  There  are  cases  of 
high  authority  to  the  contrary.  See  Alexander  v.  Germania  Ins.  Co.,  66  N.  Y. 
464,  following  Rohrbach  v.  Germania  Fire  Ins.  Co.,  62  N.  Y.  47  ;  and  see  also 
these  cases  explained  and  limited  to  the  special  facts  of  the  cases,  if  not  over- 
ruled, in  the  same  court  in  Whited  v.  Germania  Ins.  Co.,  76  N.  Y.  415.  The 
point  of  a  quasi-dual  agency  is  thoroughly  discussed  in  Southern  Law  Rev., 
Nov.  5,  1880,  p.  663,  by  Hon.  J.  0.  Pierce,  who  arrives  at  the  conclusion  that  the 
decided  weight  of  authority  is  in  accordance  with  the  view  stated  in  the  text 
See  also  post,  §  473. 

8  Bebee  v.  The  Hartford  Mut.  Fire  Ins.  Co.,  25  Conn.  51. 

264 


CII.  VII.]  AGE:^TS. —  THEIR    POWERS    AND   DUTIES.  [§  141 

for  insurance,  stands  in  tlie  same  relation  to  the  company  as 
to  such  mistakes.^ 

And  the  same  is  true  where  the  agent  assumes  to  fill  up 
the  application  from  actual  observation,  and,  while  giving  a 
full  description  of  the  property,  neglects  to  mention  matters 
material  to  the  risk,  which,  however,  were  open  to  his  ob- 
servation. This  is  no  concealment  or  withholding  of  infor- 
mation on  the  part  of  the  insured.  And  the  company  would 
be  bound  by  the  agent's  overestimated  value  of  the  property 
not  induced  by  the  applicant. ^ 

So  if  the  agent  neglects  to  state  in  the  application  the 
fact  of  an  existing  incumbrance  which  is  truly  stated  to 
him  by  the  applicant,  notwithstanding  the  application,  by  a 
memorandum  in  the  margin,  required  the  applicant  to  state 
whether  the  property  is  incumbered,  by  what,  and  to  what 
amount,  and  if  not,  to  say  so;  and  although  the  by-laws 
make  the  person  taking  the  survey  the  agent  of  the  appli- 
cant. He  is  still  the  agent  of  the  company,  and  as  such  it 
is  so  far  bound  by  his  acts  that  it  cannot  set  up  his  negli- 
gence as  a  concealment  on  the  part  of  the  insured.  ^  When 
the  policy,  however,  provides  not  only  that  the  agent  shall 
be  deemed  the  agent  of  the  applicant  and  not  of  the  com- 
pany, but  further,  that  the  company  will  not  be  bound  by 
anything  said  by  the  agent  not  contained  in  the  application, 
there  can  be  no  escape  for  the  insured.  He  will  find  him- 
self practically  uninsured.* 

§  141.  Agent  may  by  his  Acts  estop  his  Principal.  —  In- 
deed, such  an  agent  may  so  conduct  his  business  as  to  estop 

1  Woodbury  Savings  Bank  v.  Charter  Oak  Ins.  Co.,  31  Conn.  517. 

2  Cumberland  Valley  Mut.  Proct.  Co.  v.  Scbell,  29  Pa.  St.  (5  Casey)  31  ; 
Commercial  Ins.  Co.  v.  Ives,  56  111.  402.  See  also  Farmers'  Ins.  Co.  v.  Munn, 
App.  Ct.  of  111.,  First  Dist.,  9  Ins.  L.  J.  159  ;  post,  §  473. 

3  Masters  v.  Madison  Co.  Mut.  Ins.  Co.,  11  Barb.  (X.  Y.  S.  C.)  624  ;  Columbia 
Ins.  Co.  V.  Cooper,  50  Pa.  St.  331;  ante,  §  131  ;  post,  §  500  ;  Naughter  v.  Ottawa 
Agr.  Ins.  Co.,  43  U.  C.  (Q.  B.)  121;  Wyld  v.  London,  &c.  Ins.  Co.,  23  Grant's 
Ch.  442  (U.  C);  Benson  v.  Ottawa  Agr.  Ins.  Co.,  42  U.  C.  (Q.  B.)  282  j  ante, 
§  13. 

*  Shawmut  Mut.  Fire  Ins.  Co.  v.  Stevens,  9  Allen  (Mass.)  332  ;  Moore  v. 
Conn.  Mut.  Fire  Ins.  Co.,  41  U.  C.  (Q.  B.)  497  ;  Johnstone  v.  Niagara  Dist.  Mut. 
Ins.  Co.,  13  U.  C.  (C.  P.)  331  ;  Bleakley  y.  Niagara  Dist.  Mut.  Ins.  Co.,  16  Grants 
^U.  C.  Ch.)  198.     See  also  ante,  §  137,  and  post,  §  206. 

265 


§141]  insurance:  fire,    life,   accident,   etc.  [cH.  VII. 

the  company  he  represents  from  denying  the  truth  of  the 
statements  made  in  the  application ;  as  by  assuming  to  fill 
up  and  forward  an  ai)plication,  signed  by  himself  as  agent 
of  the  applicant,  but  without  authority  to  do  so.  Thus  where 
the  agent  was  requested  by  the  applicant  to  copy  the  answers 
which  he  was  upon  the  point  of  making  in  another  applica- 
tion for  insurance  upon  the  same  property,  but  instead  of 
waiting  till  he  received  such  answers  to  copy  forwarded  to 
his  company  an  old  application  for  insurance  upon  the  same 
property,  corrected  by  himself  to  suit  what  he  supposed  to 
be  the  change  of  circumstances,  thus  sending  an  application 
which  he  was  not  authorized  by  the  applicant  to  send ;  he 
was  held  to  be  the  agent  of  the  corai)any  so  far  as  to  estop 
them  from  denying  the  contract,  and  from  setting  up  its 
mistakes  as  misrepresentations  working  a  forfeiture.  He 
was  at  least  the  agent  of  the  company  for  forwarding  the 
application,  and  his  misconduct  in  that  regard  was  imput- 
able to  his  principal,  and  could  not  be  allowed  to  prejudice 
the  rights  of  the  applicant,  who  did  not  know  of  it,  and  sup- 
posed, and  had  a  right  to  suppose,  he  was  insured  upon  the 
basis  of  the  application  which  he  actually  did  send  to  the 
agent,  but  which  the  agent  did  not  forward.  And  the  court 
would  not  compel  the  insured  to  go  to  a  court  of  equity  for 
relief,  feeling  authorized  as  a  court  of  law  to  apply  precisely 
the  same  rules  of  equitable  waiver  and  estoppel  as  are  ap- 
plied in  courts  of  equity.^ 

But  if  an  agent  to  whom  the  assured  by  letter  applies  for 
insurance  fills  up  an  application,  and  signs  thereto  the  name 
of  the  assured,  though  without  his  knowledge,,  and  the  in- 
sured afterwards  receives  a  policy  with  a  copy  of  the  appli- 
cation annexed,  the  application  being  expressly  made  part 
of  the  contract,  and  the  contract  providing  that  by  accept- 
ing the  policy  the  insured  becomes  responsible  for  the  truth 
of  the  statements  contained  in  the  application,  the  fact  that 
the  original  statement  was  made  by  the  agent,  and  without 

1  Wilson  V.  Conway  Miit.  Fire  Ins.  Co.,  4  R.  I.  141.  And  see  also  Denny  v. 
Conway  Stock  &  Mut.  Fire  Ins.  Co.,  13  Gray  (Mass.),  492  ;  Ames  r.  N.  Y. 
Union  Ins.  Co.,  14  N.  Y.  253,  258. 

266 


CH.  VII,]         AGENTS.  —  THEIR    POWERS    AND    DUTIES.  [§  143 

the  knowledge  of  the  assured,  will  not  avail  to  prevent  a 
forfeiture  by  reason  of  a  material  false  statement.^ 

§  142.  Their  Knowledge  and  their  Mistakes  those  of  the 
Principal.  —  And  such  agent's  knowledge  of  the  existence  of 
a  fact  material  to  the  risk  —  as,  for  instance,  a  steam-boiler 
in  the  building,  but  not  mentioned  in  the  application  —  is 
the  knowledge  of  the  company,  and  precludes  them  from 
excepting  to  the  defect  in  the  application. ^ 

And  material  errors  made  by  the  agent  in  the  surveys 
and  measurements,  such  as  if  made  by  the  applicant  would 
amount  to  a  breach  of  warranty,  cannot  be  set  up  by  the 
company  in  defence  to  an  action  for  a  loss  under  the  policy. 
The  misstatement  is  in  law  the  misstatement  of  the  com- 
pany ;  and  although  the  writing  must  be  held  to  express  the 
contract  of  the  parties,  and  cannot  be  varied  by  parol  evi- 
dence, yet  when  the  insurance  company  wdiich  made  this 
statement  attempts  to  show  that  it  is  false,  for  the  purpose 
of  showing  a  breach  of  the  warranty,  it  may  justly  be  es- 
topped to  deny  what  it  has  once  asserted.^ 

So  if  the  agent  of  the  company,  there  being  no  written 
application,  gives  a  description  of  the  property,  from  his 
own  knowledge  obtained  by  personal  examination,  which 
description  is  inserted  in  the  policy,  and  it  is  denied  that 
the  property  destroyed  was  covered  by  the  policy,  the  com- 
pany will  not  be  allowed  to  take  advantage  of  any  inaccuracy 
in  the  language  of  the  description,  there  being  no  evidence 
of  any  attempt  to  mislead  on  the  part  of  the  assured.* 

§  143,  Agent's  Power  to  -waive  and  estop.  —  It  has,  in 
fact,  been  very  generally  held  that  knowledge  by,  or  notice 
to,  the  agent,  of  .the  inaccuracy  of  a  statement  in  the  appli- 
cation upon  which  a  policy  is  issued  after  such  notice  or 
knowledge,  binds  the  company,  and  prevents  them  from 
availing  themselves  of  the  inaccuracy  in  defence,  some  of 

1  Richardson  v.  Maine  Ins.  Co.,  46  Me.  394.  And  see  also  Goddard  v.  ilon- 
itor  Ins.  Co.,  108  Mass.  57. 

2  Campbell  v.  Merchants'  &  Farmers'  Mut.  Ins.  Co.,  37  N.  H.  35  ;  ante,  §  132. 

3  Plumb  V.  Cattaraugus  Co.  Mut.  Ins.  Co.,  18  N.  Y.  (4  Smith)  392  ;  Howard 
lus.  Co.  V.  Bruner,  23  Pa.  St.  (11  Harris)  50  ;  post,  §  498. 

*  Meadowcraft  v.  Standard  Fire  Ins.  Co.,  61  Pa.  91.     And  see  ante,  §  132. 

267 


§  143]  INSUKANCE :   FIEE,   LIFE,   ACCIDENT,   ETC.  [CH.  VII. 

the  cases  regarding  the  facts  as  amounting  to  a  waiver,  and 
others  as  working  an  estoppel  in  pais.  And  this  is  true 
even  though  the  policy  provide  that  when  the  application  is 
made  through  an  agent  of  the  company  the  applicant  shall 
be  responsible  for  such  agent's  representations.^ 

1  Miller  u.  Mut.  Ben.  Life  Ins.  Co.,  31  Iowa,  216  ;  Clark  v.  Uniou  Mnt.  Fire 
Ins.  Co.,  40  N.  H.  333  ;  Peck  v.  New  London  Co.  Mut.  Fire  Ins.  Co.,  22  Conn. 
575  ;  Hodgkins  v.  Montgomery  Co.  Mut.  Ins.  Co.,  34  Barb.  213  ;  Patten  v. 
Merchants'  &  Farmers'  Mut.  Fire  Ins.  Co.,  40  N.  H.  375  ;  Carni>bell  v.  Mer- 
chants'  &  Farmers'  Mut.  Ins.  Co.,  37  N.  H,  35  ;  Marshall  v.  Columbian  Mut. 
Ins.  Co.,  7  Fost.  (N.  H.)  157 ;  Prot.  Ins.  Co.  v.  Harmer,  2  Ohio,  N.  s.  452  ;  Howard 
Fire  Ins.  Co.  v.  Bruner,  23  Pa.  St.  50  ;  Rex  v.  Insurance  Companies,  2  Phila. 
(Pa.)  357  ;  Kelly  v.  Troy  Fire  Ins.  Co.,  3  Wis.  254  ;  Masters  v.  Madison  Co, 
Mut.  Ins.  Co.,  11  Barb.  (N.  Y.)  624;  Plumb  v.  Cattaraugus  Co.  Mut.  Ins.  Co., 
18  N.  Y.  (4  Smith)  392  ;  Williams  v.  Niagara  Ins.  Co.  (Iowa),  9  Ins.  L.  J.  38  ; 
Davey  v  Glens  Falls  Ins.  Co.,  C.  Ct.  (Minn.)  9  Ins.  L.  J.  497;  Phcenix  Ins.  Co. 
V.  Tucker,  92  111.  64  ;  Germania  Fire  lus.  Co.  v.  McKee,  94  111.  494  ;  Benson  v.  Ot- 
tawa Agr.  Ins.  Co.,  42  U.  C.  (Q.  B.)  282 ;  Wyld  v.  Lon.,  Liv.,  &  Globe  Ins.  Co., 
23  Grant  Ch.  (U.  C.)  442  ;  Ee  Universal  Non-Tariff  Fire  Ins.  Co.,  L.  R.  19  Eq. 
485  ;  Hastings  Mut.  Fire  Ins.  Co.  v.  Shannon,  2  Can.  S.  C.  Rep.  394  ;  Pechner  v. 
Phreuix  Ins.  Co.,  65  N.  Y.  195  ;  American  Ins.  Co.  v.  Gallatin  (Wis.),  9  Ins.  L.  J. 
50;  Planters'  Mut.  Ins.  Co.  v.  Deford,  38  Md.  382  ;  Mowry  v.  Rosendale,  74  N.  Y, 
360  ;  Dayton  Union  Ins.  Co.  v.  McGookey,  33  Ohio  St.  555  ;  Planters'  Ins.  Co. 
V.  Sorrells,  1  Bax.  (Tenn.)  352 ;  Cheek  v.  Columbia  Fire  Ins.  Co.,  4  Ins.  L.  ,J.  99  ; 
Cone  V.  Niagara  Fire  Ins.  Co.,  60  N.  Y.  619,  affirming  s.  c.  3  N.  Y.  S.  C.  33  ; 
Hadley  v.  New  Hampshire  Fire  Ins.  Co.,  55  N.  H.  110  ;  Pitney  v.  Glen's  Falls  Ins. 
Co.,  65  N.  Y.  6,  affirming  s.  c.  61  Barb.  (N.  Y.  S.  C.)  335  ;  Fishbeck  v.  Phrenix 
Ins.  Co.  (CaL),  11  Reptr.  218  ;  Ayres  v.  Home  Ins.  Co.,  21  Iowa,  185  ; 
Kreutz  v.  Niagara  Dist.  Mut.  Fire  Ins.  Co.,  16  U.  C.  (C.  P.)  131  ;  Farmers' 
Mut.  Fire  Ins.  Co.  v.  Taylor,  73  Pa.  St.  342 ;  Hayward  v.  National  Ins.  Co., 
52  Mo.  181  ;  Dodge  Co.  Mut.  Ins.  Co.  v.  Rogers,  12  Wis.  337  ;  Geib  v.  Inter- 
national Ins.  Co.,  1  Dill.  C.  Ct.  443,  449  ;  Ben  Franklin  Ins.  Co.  v.  Gillett  (Md.), 
9  Ins.  L.  J.  774  ;  American  Centi'al  Ins.  Co.  v.  McLanathan,  11  Kaus.  533  ; 
Broadhead  v.  Lycoming  Fire  Ins.  Co,  (N.  Y.  Sup.  Ct.),  11  Reptr.  346  ;  Bennett 
V.  North  Brit.  Ins.  Co.  (N.  Y.),  9  Ins,  L.  J.  585  ;  Reaper  City  Fire  Ins.  Co.  v. 
Jones,  62  111.  458  ;  North  Am.  Fire  Ins,  Co,  v.  Throop,  22  Mich.  146  ;  Winans  v. 
AUemania  Fire  Ins.  Co.  38  Wis.  342  ;  Williams  v.  Canada  Fire  Mut.  Ins.  Co., 
27  U.  C.  (C.  P.)  119  (showing  a  tendency  to  relax  the  strictness  of  former  cases. 
See  Chatillon  v.  Canadian  Mut.  Fire  Ins.  Co.,  27  U.  C.  (C.  P.)  450,  where  it 
was  held  that,  if  the  applicant  could  not  read,  the  insurers  were  bound  by  the 
application  filled  out  by  the  agent,  otherwise  if  the  applicant  be  able  to  read ; 
and  Newcastle  Fire  Ins.  Co.  v.  MacMorran  et  al.,  3  Dow,  255,  where  it  seems  to 
have  been  taken  for  granted  that  such  was  the  law)  ;  Perry  Co.  Ins.  Co.  v. 
Stewart,  19  Pa.  St.  45  ;  Ames  v.  N.  Y.  Union  Ins.  Co.,  14  N.  Y.  253,  258  ;  Somers 
V.  AthenfBum  Fire  Ins.  Co.,  9  Low.  Can.  R.  61  ;  Michael  v.  Mut.  Ins.  Co.  of 
Nashville,  10  La.  An.  737  ;  Roth  v.  City  Ins.  Co.,  6  McLean  (U.  S.),  324  ;  Row- 
ley V.  Empire  Ins.  Co.,  36  N.  Y.  550  ;  Beal  v.  Park  Ins.  Co.,  16  Wis.  241  ;  Davis 
V.  Scottish  Prov.  Ins.  Co.,  16  U.  C  (C.  P.)  176.  The  cases  of  Kennedy  v.  St. 
Lawrence  Co,  Mut.  Ins.  Co.,  10  Barb.  (N.  Y.)  285  ;  Sexton  i>.  Montgomery  Co. 
268 


CH.  VII.]         AGENTS.  —  THEIR   POWERS   AND   DUTIES.  [§  143 

And,  indeed,  the  tendency  of  the  courts  generally  is  daily 
becoming  more  decided  to  hold  that  such  an  agent  may 
waive  any  of  the  conditions  of  the  policy  and  bind  the  com- 
pany by  such  waiver,  and  that  his  promises  and  acts,  both 
of  omission  and  commission,  representations,  statements, 
and  assurances,  made  within  the  scope  of  his  agency,  and 
after  knowledge  of  a  breach  of  condition,  or  of  the  untruth- 
fulness, inaccuracy,  or  incompleteness  of  the  statements  in 
the  application,  if  relied  upon  by  the  insured  to  his  preju- 
dice, may  be  set  up  by  him,  being  himself  without  fault, 
either  on  the  ground  of  waiver  or  of  estoppel,  in  answer  to 
a  claim  of  forfeiture,  i  If  the  agent  be  guilty  of  fraud  upon 
the  insurers,  and  the  insured  knowingly  aids  in  its  perpetra- 
tion, or,  by  neglecting  to  read  the  application,  suffers  it  to 
be  perpetrated,  he  is  not  without  fault. ^ 

The  local  agent  of  an  insurance  company  authorized  to 
issue  and  renew  policies,  and  receive  premiums,  may  con- 
sent to  a  change  of  title ;  ^  and  in  Wisconsin,  where  the  code 
makes  him  an  agent  "to  all  intents  and  purposes,"  he  may 
waive  a  forfeiture  by  reason  of  change  of  title,  by  the  accept- 

Mut.  Ins.  Co.,  9  Ind.  191  ;  and  Jennings  v.  Chenango  Co.  Mut.  Ins.  Co.,  2  Denio 
(N.  Y.),  75,  to  the  contrary,  cannot  be  reconciled  with  the  later  cases  in  the  New 
York  courts.     See  also  post,  §  180  c. 

1  Columbian  Ins.  Co.  v.  Cooper,  50  Pa.  St.  331  ;  Franklin  r.  Atlantic  Fire  Ins. 
Co.,  42  Mo.  456  ;  Keeler  v.  Niagara  Ins.  Co.,  16  Wis.  523  ;  Viele  v.  Germania  Ins. 
Co.,  26  Iowa,  9;  Boehen  v.  Willianisburgh  Ins.  Co.,  35  N.  Y.  131 ;  Ma.y  v.  Buck- 
eye Mut.  Ins.  Co.,  25  Wis.  291  ;  Peoria  Mar.  &  Fire  Ins.  Co.  v.  Hall,  12  Mich. 
202;  Brandaf  v.  St.  Paul  Fire  &  Mar.  Ins.  Co.  (Minn.),  11  Keptr.  434.  By 
statute  in  New  Hampshire  it  is  provided,  in  relation  to  the  insurance  companies 
of  that  State,  that  when  applications  are  taken  by  an  agent  the  policy  shall  not 
be  void  by  reason  of  any  error,  mistake,  or  misrepresentation  not  intentionally 
and  fraudulently  made.  Laws  1855,  c.  1662,  §  6  ;  De  Lancey  v.  Rockingham  Mut. 
Fire  Ins.  Co.,  52  N.  H.  581.  The  law  has,  however,  no  effect  upon  foreign  insur- 
ance companies.  Campbell  v.  Merchants'  &  Farmers'  Mut.  Ins.  Co.,  iibi  sup.  See 
also  cases  cited  in  the  preceding  note.  There  are  applications  which  restrict 
the  powers  of  agents  and  call  attention  to  these  restrictions  more  or  less  con- 
spicuously,  leaving  the  applicant  in  a  hopeless  predicament  if  he  has  warranted 
his  answers  in  all  respects  true.  Lee  v.  Guardian  Life  Ins.  Co.  (C.  Ct.  Cal.),  5 
Big.  Life  &  Ace.  Ins.  Cas.  18  ;  s.  c.  2  Cent.  L.  J.  495.  See  also  ante,  §  137 ;  post, 
§  206  ;  Clevenger  v.  Mut.  Life  Ins.  Co.  (Dak.),  9  Int.  L.  J.  129. 

2  Ryan  v.  World  Mut.  Life  Ins.  Co.,  41  Conn.  168.  See  also  Lee  v.  Guardian 
Life  Ins.  Co.  (C.  Ct.  Cal.),  5  Big-  Life  &  Ace.  Ins.  Cas.  18  ;  s.  c.  2  Cent.  L.  J 
495.     See  also  post,  §  507. 

8  111  Mut.  Fire  Ins.  Co.  v.  Stanton,  57  111.  354. 

269 


§  144]  INSURANCE  :   FIRE,   LIFE,   ACCIDENT,    ETC.  [CH.  VII. 

ance  of  the  premium  and  the  issue  of  a  renewal  receipt, 
with  full  knowledge  of  the  change  of  title  ;^  he  may  also, 
after  the  issue  of  the  policy,  and  in  contravention  of  its 
provisions,   consent  to  further  insurance. ^ 

§  144.  Same  Subject.  —  To  these  numerous  and  respect- 
able authorities  the  Supreme  Court  of  the  United  States  has 
added  the  weight  of  its  deliberate  approval.^  That  court  holds 
the  language  quoted  in  the  note.*   In  Iowa,°  the  broad  proposi- 

1  Miner  v.  Phcenix  Ins.  Co.,  27  Wis.  693  ;  s.  c.  1  Ins.  L.  J.  41. 

2  Schoener  v.  Hekla  Fire  Ins.  Co.  (Wis.),  10  lus.  L.  J.  306. 

3  Union  Mut.  Ins.  Co.  v.  Wilkinson,  13  Wall.  (U.  S.)  222  ;  American  Ins.  Co. 
V.  Mahone,  21  Wall.  (U.  S.)  152  ;  Fames  v.  Home  Ins.  Co.,  94  U.  S.  621.  [See, 
however,  §  145  A.  for  a  later  case  in  the  same  court,  which  moves  in  the  oppo- 
site direction.] 

*  "This  question  has  been  decided  differently  by  courts  of  the  highest  respec- 
tability in  cases  precisely  analogous  to  the  present.  It  is  not  to  be  denied  that 
the  application,  logically  considered,  is  the  work  of  the  assured,  and  if  left  to  him- 
self as  to  such  assistance  as  he  might  select,  the  person  so  selected  would  be  his 
agent,  and  he  alone  would  be  responsible.  On  the  other  hand,  it  is  well  known 
—  so  well  that  no  court  would  be  justified  in  shutting  its  eyes  to  it  —  that  insur- 
ance companies  organized  under  the  laws  of  the  State,  and  having  in  that  State 
their  principal  business  office,  send  their  agents  all  over  the  laud,  with  directions 
to  solicit  and  procure  applications  for  policies,  furnishing  them  with  printed 
arguments  in  favor  of  the  value  and  necessity  of  life  insurance,  and  of  the  special 
advantages  of  the  corporation  which  the  agent  represents.  They  pay  these  agents 
large  commissions  on  the  premiums  thus  obtained,  and  the  policies  are  delivered 
at  their  bauds  to  the  assured.  The  agents  are  stimulated  by  letters  and  instruc- 
tions to  activity  in  procuring  contracts ;  and  the  party  who  is  in  this  manner 
induced  to  take  out  a  policy  rarely  sees  or  knows  anything  about  the  company  or 
its  oflBcers  by  whom  it  is  issued,  but  looks  to,  and  relies  upon,  the  agent  who  has 
persuaded  him  to  effect  insurance,  as  the  full  and  complete  representative  of  the 
company  in  all  that  is  said  or  done  in  making  the  contract.  Has  he  not  a 
right  to  so  regard  him  ?  It  is  yet  true  that  the  reports  of  judicial  decisions  are 
filled  with  the  efforts  of  these  companies,  by  their  counsel,  to  establish  the  doc- 
trine that  they  can  do  all  this,  and  yet  limit  the  responsibility  of  the  acts  of  these 
agents  to  the  simple  receipt  of  the  premium  and  delivery  of  the  -policy  ;  the  argu- 
ment being  that  as  to  all  other  acts  of  the  agent  he  is  the  agent  of  the  insured. 
This  proposition  is  not  without  support  in  some  of  the  earlier  decisions  on  the 
subject ;  and,  at  a  time  when  insurance  companies  waited  for  parties  to  come  to 
them  to  seek  assurance,  or  to  forward  application  on  their  own  motion,  the  doc- 
trine had  a  reasonable  foundation  to  rest  upon.  But  to  apply  such  a  doctrine  in 
its  full  force  to  the  system  of  selling  policies  through  agents,  which  we  have 
described,  would  be  a  delusion  and  a  snare,  leading,  as  it  has  done  in  numerous 
instances,  to  the  grossest  frauds,  of  which  the  insurance  companies  receive  the 
benefit,  and  the  parties  supposing  themselves  insured  are  the  victims.  The 
tendency  of  the  modem  decisions  in  this  country  is  steadily  in  the  opposite  direc- 


6  Miller  v.  Mut.  Benefit  Life  Ins.  Co. ,  31  Iowa,  216. 

270 


CH.  VIL]  agents.  —  THEIR    POWERS    AND   DUTIES.  [§  144 

tion  has  been  affirmed  that  "  an  insurance  company  transact- 
ing business  through  an  agent  having  authority  to  solicit, 
make  out,  and  forward  applications,  to  deliver  policies  when 
returned,  and  to  collect  and  transmit  premiums,  is  affected 
by  the  knowledge  acquired  by  such  agent  when  engaged  in 
procuring  an  application,  and  bound  by  his  acts  done  at 
such  time  with  respect  thereto.  "^  In  order,  however,  that 
statements  made  to  the  company's  agent,  but  misunderstood 
or  not  set  down  by  him  in  the  application,  may  protect  ^the 
insured  from  the  consequences  of  misrepresentation,  it  should 
appear  that  they  were  made  at  the  time  when  the  application 
was  taken,  and  in  connection  therewith;  statements  made 
at  a  prior  and  fruitless  interview  cannot  have  that  effect. ^ 

tion.  The  powers  of  the  agent  are,  prima  facie,  coextensive  with  the  business 
intrusted  to  his  care,  and  will  not  be  narrowed  by  limitations  not  communicated 
to  the  persons  with  whom  he  deals.  Bebee  v.  Hartford  Ins.  Co.,  25  Conn.  51  ; 
Lycoming  Ins.  Co.  v.  Schollenberger,  8  Wright  (Pa.),  259  ;  Beal  v.  Park  Ins.  Co., 
16  Wis.  241;  Davenport  v.  Peoria  Ins.  Co.„17  Iowa,  276.  An  insurance  com- 
pany establishing  a  local  agency  must  be  held  responsible  to  the  parties  with 
whom  they  transact  business  for  the  acts  and  declarations  of  the  agent,  within 
the  scope  of  his  employment,  as  if  they  proceeded  from  the  principal.  Woodbury 
Savings  Bank  v.  Charter  Oak  Ins.  Co.,  31  Conn.  517  ;  Horwitz  v.  Equitable  Ins. 
Co.,  40  Mo.  557  ;  Ayres  v.  Hartford  Ins.  Co.,  17  Iowa,  176  ;  Howard  Ins.  Co.  v. 
Bruner,  11  Mar.  (Pa.)  50. 

"In  the  fifth  edition  of  American  Leading  Cases,  after  a  full  consideration  of 
the  authorities,  it  is  said  ;  '  By  the  interested  or  officious  zeal  of  the  agents  em- 
ploved  by  the  insurance  companies  in  the  wish  to  outbid  each  other  and  procure 
customers,  they  not  unfrequently  mislead  the  insured  by  a  false  or  erroneous  state- 
ment of  what  the  application  should  contain,  or,  taking  the  preparation  of  it  into 
their  own  hands,  procure  his  signature  by  an  assurance  that  it  is  properly  drawn 
and  will  meet  the  requirements  of  the  policy.  The  better  opinion  seems  to  be 
that,  when  this  course  is  pursued,  the  description  of  the  risk  should,  thougli 
nominally  proceeding  from  the  assured,  be  regarded  as  the  act  of  the  insurers.' 
Vol.  ii.  p.  947  ;  Rowley  v.  Empire  Ins.  Co.,  36  X.  Y.  550.  The  modern  deci- 
sions fully  sustain  this  proposition,  and  they  seem  to  us  founded  in  reason  and 
justice,  and  meet  our  entire  approval.  This  principle  does  not  admit  oral  testi- 
mony to  vary  or  contradict  that  which  is  in  writing,  but  it  goes  upon  the  idea  that 
the  writing  offered  in  evidence  was  not  the  instrument  of  the  party  whose  name 
was  signed  to  it ;  that  it  was  procured  under  such  circumstances  by  the  other 
side  as  estops  that  side  from  using  it  or  relying  on  its  contents  ;  not  that  it  may 
be  contradicted  by  oral  testimony,  but  that  it  may  be  shown  by  such  testimony 
that  it  cannot  be  lawfully  used  against  the  party  whose  name  is  signed  to  it." 
[If  testimony  is  admitted  to  show  that  the  application  was  not  that  of  the  assured, 
and  that  application  is  declared  by  the  policy  to  be  the  basis  of  the  contract,  does 
not  such  testimony  show  that  there  is  no  contract  ?] 

1  New  Jersey  Mut.  Life  Ins.  Co.  v.  Baker,  94  U.  S.  610. 

2  Boggs  et  al.  v.  America  Ins.  Co.,  30  Mo.  63. 

271 


§  144  A]        INSUKANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  VII. 

[§  144  A.  In  regard  to  matters  correctly  stated  to  him  or 
known  to  him,  his  mistakes  without  fault  or  knowledge  of 
the  assured  bind  the  company,  i  Such  is  the  rule  laid  down 
by  the  majority  of  the  cases  in  very  broad  terms,  even 
though  the  policy  declares  the  statements  in  the  application 
to  be  warranties.2  If  an  ignorant  applicant  is  imposed  on 
or  taken  advantage  of  by  the  agent  and  so  fails  to  state  the 
interest  of  another  person,  as  required  by  the  policy,  he  will 
nevertheless  be  protected  after  loss  to  the  extent  of  his  own 
real  interest.^  Bad  faith  is  worse  than  ignorance.  If  the 
agent  deceives  the  assured  as  to  the  filling  up  of  the  applica- 
tion so  that  it  states  a  falsehood,  the  company  is  estopped 
from  setting  this  up  as  a  defence.*  (a)] 

1  [Williamson  v.  New  Orleans  Ins.  Ass.,  84  Ala.  106  ;  Brown  v.  Commercial  F. 
Ins.  Co.,  86  Ala.  189  ;  Ala.  Gold  Life  Ins.  Co.  v.  Garner,  77  Ala.  210 ;  O'Brien  v. 
Home  Ben.  Soc,  51  Hun,  495  ;  Pickel  v.  Phenix  Ins.  Co.,  18  Ins.  L.  J.  598  (lud. ), 
June,  1889  ;  Continental  Ins.  Co.  v.  Munns,  120  Ind.  30  ;  Kingston  v.  Mtna.  Ins. 
Co.,  42  Iowa,  46,   47  ;  Wheaton  v.  North  Brit.    &  Mer.  Ins.  Co.,  76  Cal.  415  ; 
Stone  V.  Hawkeye  Ins.  Co.,  68  Iowa,  734  ;  Hnrnthal  v.  Insurance  Co.,  88  N.  C.  71 ; 
Western  Ass.  Co.  v.  Kector,  85   Ky.  295  (misrepresentation  of  title  by  agent)  ; 
Kansal  v.  Minn.,  &c.  Fire  Ass.,  31  Minn.  17  ;  Menk  v.  Home   Ins.  Co.,  76  Cal. 
50 ;  Continental  Ins.  Co.  v.  Pearce,  39  Kans.  396  (insured  signed  the  application 
not  knowing  its  contents)  ;  Young  v.  Travellers'  Ins.  Co.,   80  Me.   244  (agent 
misstates  date  of  accident  in  the  proofs)  ;  Continental   Life  Ins.  Co.  v.  Thoena, 
26  Brad.  495  ;  Phenix  Ins.  Co.  v.  Allen,  109  Ind.  273  (misdescription  of  property 
by  agent)  ;  Sullivan  v.  Phenix  Ins.  Co.,  34  Kans.  170  (deliberate  fraud  of  agent). 
A  local  soliciting  agent  filling  up  an  application  acts  for  the  company,  and  if  he 
makes  a  mistake  in  regard  to  matters  correctly  stated  to  him  by  the  applicant, 
the  company  is  bound.     Insurance  Co.  v.  Williams,  39  Ohio  St.  584,  588.    If  the 
insured  fully  and  correctly  states  the  facts  to  the  agent,  misleading  or  erroneous 
answers  inserted  in  the  application  by  such  agent  estop  the  company.     Kenyon 
V.  Knights  Templars,  &c.  Aid  Ass.,  48  Hun,  278.] 
2  [Continental  Ins.  Co.  v.  Pearce,  39  Kans.  396.] 
8  [Diebold  V.  Phoenix  Ins.  Co.,  33  Fed.  Rep.  807  (Kan.),  1888.] 
*  [Geib  V.  International  Ins.  Co.,  1  Dill.  443,  447.] 

{a)    If  the   agent  writes  untrue   or  Ace.    Co.,    97   Ga.    502;    Robinson   v. 

partial  answers  in  the  application,  when  Met'n  L.  Ins.  Co.,  37  N.  Y.  S.  146; 

the  applicant    answers    truly   or   more  McGuire  v.  Hartford  F.  Ins.  Co.,  40  id. 

fully  upon  a  material  question,  the  in-  300  ;  Peters  v.  U.  S.  Ind'l  Ins.  Co.,  42 

surer  is  bound   by  the  answers  really  id.  348  ;  Clemens  v.  Supreme  Assembly 

made,  as  the  insurer  has  notice  through  (N.  Y.),   16    L.    R.    A.  33,   and   note ; 

him.     Standard  L.  &  Ace.  Ins.  Co.  v.  Liumbermen's    Mut.    Ins.    Co.    v.    Bell, 

Davis,  59   Kansas,   521 ;    Kansas  Mill-  166  111.  400  ;  Rochester  Loan  &  B.  Co.  v. 

owners'   M.    F.    Ins.    Co.    v.    Central  Liberty  Ins.  Co.,  44  Neb.  537  ;  Home  F. 

Nat.  Bank,  60  id.  630  ;  State  Ins.  Co.  Ins.  Co.  w.  Fallon,  45  Neb.  554;  German- 

V.  Gray,  43  id.  731 ;  Clubb  v.  American  American  Ins.  Co.  v.  Hart,  43  Neb.  411. 

272 


CH.  VII.]         AGENTS. — THEIR   POWERS   AND   DUTIES.        [§  144  C 

[§  144  B.  Omissions  or  false  answers  made  by  the  agents 
of  a  company,  with  no  collusion  by  the  assured,  do  not  avoid 
the  policy.  1  When  an  agent  of  the  company  with  full  knowl- 
edge of  the  facts  makes  out  an  application,  it  is  conclusive 
upon  the  company. ^  In  Maine  this  is  so  by  statute.^  A 
mistake  of  an  agent  of  the  company  in  naming  the  owners 
in  the  application  or  in  the  proofs  of  loss  without  knowledge 
of  the  assured,  cannot  defeat  the  policy.'*  The  insurance 
company  is  responsible  for  the  negligence  of  its  agent  in 
wrongly  stating  the  age  of  the  applicant  in  the  application, 
having  been  correctly  informed.^  Where  the  applicant  is 
ignorant  and  in  good  faith  trusts  to  the  agent  in  making  the 
application,  it  is  the  company's  act.^  If  the  medical  exam- 
iner acting  as  agent  of  the  company  undertakes  to  write  the 
application  from  his  own  knowledge,  rather  than  from  the 
answers  of  the  assured,  the  company  is  responsible.'] 

[§  144  C.  If  the  agent  makes  a  misstatement  in  the  appli- 
cation and  gets  the  insured  to  sign  it  without  acquainting 
him  with  the  contents,  the  company  is  bound  %  the  state- 
ment.^ An  omission  in  the  description  of  the  property  by 
mistake  of  the  agent  in  filling  out  the  application,  afterward 
signed  by  the  insured,  will  not  prejudice  the  latter,  even 
though  the  policy  provides  that  the  agent  shall  be  deemed 
to  act  for  the  insured.^  Parol  is  admissible  to  show  that 
the  statements  given  to  the  agent  were  different  from  those 
in  the  application  transcribed  by  him  and  sent  to  the  com- 
pany, though  the  application  was  signed  by  the  insured,  not 
knowing  its  contents  were  different  from  the  statements  he 


1  [McArthur  v.  Globe  Miit.  Life  Ins.  Co.,  14  Hun,  348,  354.] 

2  [Andes  Ins.  Co.  v.  Fish,  71  111.  620,  623.] 

3  [Gaston  v.  Monmouth  Mut.  Fire  Ins.  Co.,  54  Me.  170,  172.] 

4  [Parker  v.  Amazon  Ins.  Co.,  34  Wis.  363,  370.] 

6  [McCall  V.  Phcenix  Mot.  Life  Ins.  Co.,  9  W.  Va.  237,  243.] 
^  [Hartford  Ins.  Co.  v.  Haas,  87  Ky.  531.     In  this  case  an  ignorant  German 
woman  who  had  only  a  dower  interest  was  protected,  although  the  policy  was 
conditioned  to  be  void  unless   interests  other   than  a  fee"  simple   were   stated. 
The  agent  had  obtained  knowledge  of  the  real  facts  in  another  transaction.] 
T  [Pudritzky  v.  Knights  of  Honor,  76  Mich.  428.] 

8  [Dunbar  v.  Phenix  Ins.  Co.,  72  Wis.  492.] 

9  [Insurance  Co.  v.  Cusick,  109  Pa.  St.  157.] 

VOL.  I.  — 18  273 


§  144  D]       INSURANCE  :  FIRE,  LIFE,  ACCIDENT,   ETC.  [CH.  VII. 

had  made  to  the  agent. ^  If  the  agent  fills  out  the  applica- 
tion, the  insured,  being  ignorant  of  false  statements  therein, 
is  not  affected  by  them,  although  a  copy  of  the  application 
was  attached  to  the  policy,  and  he  failed  to  give  notice  to 
the  company  that  the  statements  were  untrue. ^  When  the 
company's  agent,  knowing  the  circumstances  (viz.,  an  in- 
cumbered equitable  title),  filled  in  the  application,  "fee 
simple  —  no  incumbrances,"  and  the  assured  signed  it  with- 
out reading,  supposing  it  was  all  right,  it  was  held  that  the 
company  could  not  set  up  concealment  or  breach  of  war- 
ranty. ^  If  an  agent,  knowing  of  incumbrances,  states  in 
the  application  that  there  are  none,  and  procures  the  signa- 
ture of  the  applicant  who  is  ignorant  in  such  matters,  the 
condition  against  incumbrances  is  waived,  notwithstanding 
the  policy  says  there  shall  be  no  waiver  but  in  writing 
signed  by  the  president  or  secretary.^] 

[§  144  D.  If  an  agent  fills  in  an  answer  to  a  question  that 
was  not  propounded  to  the  insured  and  which  he  did  know 
was  in  the  application  signed  by  him  in  reliance  on  the 
agent  and  without  reading,  the  answer  is  the  act  of  the 
company.^  If  A.  goes  to  insure  his  wife's  property  and  tells 
the  agent  the  facts  and  requests  a  policy  in  his  wife's  name, 
but  the  agent  makes  the  policy  in  A.'s  name,  A.  may  sue  on 
the  policy  as  agent  of  his  wife.^  When  an  agent  accepts  a 
verbal  application,  and  afterward  writes  out  an  application 
without  the  insured's  knowledge,  she  is  not  bound  by  it, 
although  the  policy  refers  to  it.  It  would  be  a  fraud  on  her 
to  hold  her  to  an  application  she  knew  nothing  of.''  It  is 
doubtful  whether  even  the  delivery  of  a  policy  is  notice  of 
its  contents  to  one  who  cannot  read,  and  who  is  assured  by 
the  agent  that  it  is  all  right,   and  in  accordance  with  the 

1  [Continental  Ins.  Co.  v.  Pearce,  39  Kans.  396.] 

2  [Donnelly  v.  Cedar  Eapids  Ins.  Co.,  70  Iowa,  693.] 

8  [Combs  V.  Hannibal  Savings  &  Ins.  Co.,  43  Mo.  148,  151  ;  Dahlberg  v.  St. 
Louis  Mut.  Fire  &  Mar.  Ins.  Co.,  6  Mo.  App.  121,  128.] 
*  [Renier  v.  Dwelling-House  Ins.  Co.,  74  Wis.  89.] 
6  [Schwarzbach  v.  Protective  Union,  25  W.  Va.  624,  661.] 
6  [Deitz  V.  Insurance  Co.,  31  W.  Va.  851.] 
T  [Baker  o.  Insurance  Co.,  70  Mich.  199.] 

274 


CH.  VII,]         AGENTS.  —  THEIR   POWERS   AND   DUTIES.         [§  144  D 


contract.^  (a)  Where  an  application  was  signed  by  the  in- 
sured and  afterward  changed  by  the  agent  without  the  knowl- 
edge of  the  assured,  it  was  held  that  the  company  was  bound, 
and  the  insured  could  not  be  held  on  the  inserted  warranty 
(but  in  this  case,  as  the  policy  plainly  stated  that  if  the  in- 
sured was  not  the  sole,  <tc.,  owner  the  title  must  be  ex- 
pressed, and  he  had  not  expressed  his  interest,  the  policy 
was  void,  and  he  could  not  be  heard  to  say  that  he  had  not 
read  it).^  If  an  agent  substitutes  a  spurious  application  for 
that  made  by  the  assured,  the  company  cannot  rescind  on 
discovering  of  the  fraud.  ^] 

1  [Continental  Ins.  Co.  v.  Ruckman,  127  111.  364.] 

2  [Swan  V.  Watertown  Fire  Ins.  Co.,  96  Pa.  St.  37,  43.] 

8  [Mass.  Life  Ins.  Co.  v.  Eshelman,  30  Ohio  St.  647,  657.] 


(a)  It  is  the  duty  of  the  insured 
upon  receiving  his  policy  to  examine  it 
promptly  and,  if  it  does  not  contain  the 
stipulations  agreed  upon  between  him 
and  the  agent,  to  at  once  notify  the  com- 
pany of  his  refusal  to  accept  the  policy. 
The  fact  that  the  insured  cannot  read 
does  not  relieve  him  of  the  duty  to  in- 
form himself  seasonably  whether  or  not 
the  contract,  as  executed  and  delivered 
to  him,  complies  with  the  original  under- 
standing, such  duty  being  the  same  as 
rests  under  such  circumstances  upon 
contracting  parties  who  are  not  illiter- 
ate. McHoney  v.  German  Ins.  Co.,  52 
Mo.  App.  94  ;  but  see  Omaha  F.  Ins. 
Co.  V.  Crighton,  50  Neb.  314.  Where  a 
policy  of  insurance,  with  a  copy  of  the 
application  indorsed  thereon,  was  sent 
by  the  company  to  the  insured,  and  was 
in  his  possession  for  several  months 
before  the  loss  occurred,  he  was  held 
chargeable  in  law  with  knowledge  of 
the  contents  of  both  the  policy  and  the 
application  ;  and  the  circumstance  that 
the  assured  did  not  actually  read  or 
know  the  contents  of  the  application, 
or  know  that  a  copy  of  the  application 
was  indorsed  on  the  policy,  makes  no 
difference,  but  the  paper  being  his  own 
contract,  and  in  his  actual  custody,  he 
will  be  presumed  to  know  all  it  contains, 
even  if  the  copy  on  the  back  was  not  re- 


ferred to  in  the  body  as  being  indorsed 
there.  Johnson  v.  Dakota  F.  &  M.  Ins. 
Co.,  1  No.  Dak.  167.  After  repeated 
payments  of  the  annual  premiums,  the 
insured  is  presumed  to  be  familiar  with 
the  terms  of  his  policy.  Union  Central 
L.  Ins.  Co.  V.  Hook  (Ohio),  56  N.  E.  906. 
When  the  policy  is  delivered  by  the 
insurer  at  the  place  and  to  the  person 
named  by  the  insured,  he  is  bound  by 
its  terms,  though  he  does  not  read  it, 
there  being  no  evidence  of  anything  to 
prevent  him  from  so  doing.  iEtna  Ins. 
Co.  V.  Holcomb,  89  Texas,  404,  410; 
Quinlan  v.  Providence-Washington  Ins. 
Co.,  133  N.  Y.  356,  364.  On  the  other 
hand,  in  McElroy  v.  British  America 
Ass.  Co.,  94  Fed.  l^ep.  990,  1000,  the  in- 
sured was  held  entitled  to  rely  upon  the 
agent's  making  the  contract  conform 
with  his  application,  and  his  neglect  to 
read  the  entire  policy  was  held  not  to 
excuse  the  insurer  for  such  default  of  its 
agent.  See  also  Gristock  v.  Royal  Ins. 
Co.,  87  Mich.  428  ;  Delouche  v.  Met'n  L. 
Ins.  Co.  (N.H.),  45  Atl.  414;  McMaster 
V.  New  York  L.  Ins.  Co.,  99  Fed.  Rep. 
856  ;  Dryer  v.  Security  F.  Ins.  Co. 
(Iowa),  82  N.  W.  494 ;  Shedden  v. 
Heard  (Ga.),  35  S.  E.  707  ;  Wilson  v. 
National  L.  Ins.  Co.,  31  Misc.  Kep. 
(N.  Y. ),  403.    See  infrcr,  §  200,  note  (a). 

275 


§  144  E3       INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.        [CH.  VII. 

[§  144  E.  Where  the  agent,  knowing  the  facts  of  a  mort- 
o-ao-e  for  <|2,000  covering  two  buildings,  one  of  wliich  was 
the  mill  insured,  of  his  own  motion  apportioned  the  mort- 
gage and  called  it  $1,000  on  each  building,  so  that  the 
application  for  insurance  on  the  mill  represented  the  incum- 
brances on  it  as  $1,000,  the  evidence  of  these  facts  should 
be  admitted  to  show  that  the  company  was  aware  of  the  true 
state  of  the  case,  and  therefore  estopped/  Where  an  insur- 
ance agent,  with  full  knowledge  of  the  facts,  causes  the 
applicant  to  make  a  wrong  statement,  the  company  is  es- 
topped, there  being  no  bad  faith  on  the  part  of  the  assured. ^ 
So,  if  the  agent  and  the  insured  are  both  ignorant  of  a 
change  of  ownership  in  the  premises  upon  which  the  insured 
holds  a  mortgage,  a  misstatement  by  the  agent  resulting 
from  such  ignorance  cannot  be  taken  advantage  of  by  the 
company.^  When  an  agent  has  authority  to  procure  insur- 
ance and  forward  applications,  his  acts  in  filling  out  such 
applications,  without  knowledge  of  the  assured,  bind  the 
company,  in  spite  of  a  stipulation  in  the  policy  subsequently 
issued  to  the  eifect  that  he  shall  be  deemed  to  have  acted  for 
the  insured.*  This  is  not  a  violation  of  the  rule  that  verbal 
testimony  is  not  admissible  to  vary  a  written  contract.  It 
proceeds  on  the  ground  that  the  contents  of  the  paper  were 
not  his  statement,  —  that  the  writing  is  not  the  contract 
made,  though  signed  by  the  insured.  Although  parol  is  not 
admissible  to  vary  a  written  contract,  it  is  admissible  to 
effect  an  estoppel,  as  by  showing  that  the  agent  took  advan- 
tage of  the  inability  of  the  insured  to  read,  or  misled  him 
as  to  the  provisions  of  the  policy.^  An  applicant  is,  how- 
ever, presumed  to  have  read  the  application  before  signing 
it,  and  in  the  absence  of  proof  that  she  was  imposed  on,  or 
that  the  agent  knew  the  falsity  of  the  statement,  —  of  value, 
for  example,  —it  will  be  fatal.^     Even  proof  that  the  agent 

1  [Ring  V.  Windsor  Co.  Mut.  Fire  Ins.  Co.,  51  Vt.  563,  569.] 

2  [Mut.  Benefit  Life  Ins.  Co.  v.  Daviess'  Ex'x,  87  Ky.  541] 

8  [Poughkeepsie  Savings  Bank  v.  Manhattan  Fire  Ins.  Co.,  30  Hun,  473.] 

*  [Deitz  V.  Insurance  Co.,  31  W.  Va.  851,  856,  857.] 

5  [Rivara  v.  Queen's  Ins.  Co. ,  62  Miss.  720.] 

5  [Briggs  V.  Fireman's  Ins.  Co.,  65  Micli.  52.] 

276 


CH.  VII.]  AGENTS.  —  THEIR   POWERS    AND   DUTIES.        [§  144  F 

filled  in  the  answers  after  the  application  was  signed  and 
after  he  returned  to  his  office,  is  not  enough  without  evi- 
dence that  his  statements  differed  from  those  that  had  been 
made  to  him,  or  which  he  knew  to  be  the  correct  ones.^  It 
has  been  held  that  evidence  that  the  insured  answered  the 
agent  truly,  that  the  agent  filled  in  the  application,  and  that 
the  applicant  signed  it  supposing  it  to  be  correct  is  inadmis- 
sible, in  answer  to  the  defence  that  the  application  contains 
material  falsities.  The  insured  is  presumed  to  know  what 
he  signs.  Afterward,  however,  the  ruling  was  reversed,  and 
the  doctrine  advanced  that  such  evidence  is  admissible,  and 
he  may  recover  on  showing  that  his  oral  answers  were  true, 
and  the  other  facts  as  above. ^J 

[§  144  F.  When  the  policy  on  merchandise  in  a  store  pro- 
hibited the  keeping  of  petroleum  and  a  barrel  was  on  hand 
when  the  fire  occurred,  it  was  held  to  avoid  the  policy  eve7i 
though  the  agent  k^iew  of  this  at  the  execution  of  the  policy.^ 
Notice  to  an  agent  whose  authority  extends  merely  to  receiv- 
ing and  forwarding  applications,  premiums,  and  policies, 
that  gunpowder  is  kept  in  the  store,  is  not  notice  to  the 
company.^  A  warranty  that  the  building  insured  is  a  dwell- 
ing-house occupied  by  the  applicant,  when  really  it  was 
unfinished  and  unoccupied,  is  fatal,  although  the  agent  in- 
spected the  building  and  wrote  the  application,  reading  it, 
however,  to  the  insured,  who  signed  it.  With  respect  to 
such  an  application  the  agent  acts  for  the  insured.^  Where 
the  policy  states  that  the  assured  adopts  and  warrants  all 
statements  in  the  application,  he  cannot  set  up  the  fact  that 
the  agent  improperly  and  untruthfully  filled  out  the  applica- 
tion after  being  correctly  informed.^  If  the  policy  clearly 
describes  one  building,  no  external  evidence  is  admissible 
to  show  that  another  was  meant,  even  though  the  description 

1  [Brown  v.  Metropolitan  Life  Ins.  Co.,  65  Mich.  306.] 

2  [Fletcher  v.  N.  Y.  Life  Ins.  Co.,  3  McCrary,  603,  607  ;  11  Fed.  Rep.  377  ; 
12  Fed.  Rep.  557  ;  13  Fed.  Rep.  526  ;  14  Fed.  Rep.  846  ;  12  Ins.  L.  J.  122.] 

3  [Bii-mingliam  Fire  Ins.  Co.  v.  Kroegher,  83  Pa.  St.  64,  67.] 

4  [Liverpool,  &c.  Ins.  Co.  v.  Van  Os,  63  Miss.  431,  441.] 

s  [Pottsville  Mut.  Fire  Ins.  Co.  v.  Froram,  100  Pa.  St.  347.] 
6  [Wilkins  v.  Mut.  Reserve  Fund  Life  Ass.,  54  Hun,  294.] 

277 


§  144  G]       INSURANCE  :    FIRE,   LIFE,   ACCIDENT,    ETC.         [CH,  VII. 

was  a  mistake  of  the  agent,  he  being  only  authorized  to  make 
surveys  and  receive  applications,  the  company  approving  the 
risks.     The  minds  of  the  contracting  parties  never  met.^] 
rS  144  G.    Discussion  of  the  Effect  of  the  Agent's  Knowledge. 

How  far  the  knowledge  of  an  insurance  agent  ought  to 

affect  the  company  is  a  very  serious  question,  as  the  cases 
in  the  foregoing  sections  make  manifest.  Given  a  company 
dealing  through  A.  with  C.,  what  effect  is  to  be  given  to 
A.  's  knowledge  ?  That  is  the  problem.  The  object  of  the 
law  as  regards  commercial  life  is  to  repress  bad  faith  and 
negligence,  and  favor  good  faith,  certainty,  and  facility  of 
doing  business.  This  it  accomplishes  by  throwing  the  con- 
sequences of  evil  on  the  wrong-doer,  and  securing  the  nat- 
ural results  of  good  conduct  to  the  "conductor,"  if  we  may 
warp  that  word  to  the  occasion,  and,  where  necessary  for 
the  protection  of  society  from  the  acts  of  those  employed  by 
others  and  not  of  themselves  sufficiently  responsible,  the  law 
holds  the  employer.  It  is  all  a  matter  of  judgment  and  com- 
mon sense,  and  the  sole  question  is  what  arrangement  will 
be  best  for  society  all  things  considered.  Coming  to  the 
question  before  us  with  this  principle  in  mind,  — 

1.  It  is  clear  that  if  the  insurer  himself  knows  the  fatal 
fact  F.,  and  afterward  recognizes  the  contract  of  insurance 
as  valid  by  receiving  premiums,  making  assessments,  &c.,  he 
should  be  held ;  good  faith  and  certainty  require  it.  Were  it 
not  for  being  lulled  into  security  the  insured  would  not  use- 
lessly pay  out  his  money,  but  would  procure  new  insurance. 

2.  It  is  equally  clear  that  if  the  insurer  I.  himself  does 
not  know  the  fact  F.,  and  the  insured  C.  doesknow  it,  and 
has  good  reason  to  believe  that  I.  does  not,  C.  should  reap 
the  appropriate  harvest  of  his  bad  faith  in  the  loss  of  the 
contract,  no  matter  what  A.'s  knowledge  may  be.  This 
covers  cases  of  collusion  between  C.  and  A.,  and  cases  in 
which  C.  warrants  or  represents  to  the  company  an  untruth, 
although  known  to  the  agent  to  be  untrue, ^  If  A.  knows 
the  fatal  fact  F. ,  but  through  fraud  or  negligence  does  not 

1  [Sanders  v.  Cooper,  115  N.  Y.  279.] 

2  [See  §  133  B.] 

278 


CH.  VII.]         AGENTS.  —  THEIR   POWERS   AND    DUTIES.         [§  144  G 

inform  I.  of  it,  and  C.  is  ignorant  of  I. 's  ignorance,  has 
acted  properly  informing  A.  correctly,  in  all  respects  con 
ducting  himself  in  good  faith,  and  is  guilty  of  no  greater 
negligence  than  is  involved  in  relying  on  A.  to  do  properly 
the  business  entrusted  to  him  by  the  company,  and  failing  to 
check  his  work  by  reading  the  application  and  policy,  or  get 
some  reliable  person  not  adversely  interested  to  read  it  for 
him,  theyi  the  question  of  loss  as  between  I.  and  C.  is  one  of 
difficulty. 

It  may  be  said,  on  the  one  hand,  that  it  is  a  very  small 
matter  for  each  person  to  read  the  papers  or  have  them  read, 
that  the  company  cannot  test  the  character  or  govern  the 
action  of  its  agents  all  over  the  world,  and  that  it  is  entitled 
to  this  slight  aid  from  the  public  to  help  it  keep  the  agents 
straight.  And  it  does  seem  a  great  hardship  on  a  company 
to  make  it  pay  thousands  of  dollars  on  a  risk  it  might  never 
have  taken  but  for  a  falsehood  or  misstatement  in  a  paper 
signed  by  the  assured  without  reading.  The  agent  in  writ- 
ing the  application  is  really  doing  the  assured's  part  in  the 
negotiations,  and  the  latter  knows  that  the  whole  contract 
is  to  be  based  upon  that  application.  He  knows  also  that 
the  agent  is  liable  to  error,  and  open  to  temptation  to  de- 
fraud, and  Jtie  should  as  a  prudent  man  read  the  papers.  On 
the  other  hand,  it  may  be  said  that  the  company  selects  the 
agent  to  do  its  work.  He  is  under  its  command  and  subject 
to  its  discharge.  The  profits  of  the  business  done  by  him 
belong  to  it.  The  assured  has  no  control  over  him,  and  is 
invited  by  the  company  to  rely  on  him.  It  is  the  wide- 
spread custom  to  give  the  agent  the  facts  verbally,  and  leave 
him  to  write  the  application,  and  certainty  and  facility  of 
doing  business  require  that  the  public  should  be  protected  in 
this  its  chosen  manner  of  dealing.  It  would  open  the  door- 
way to  the  grossest  frauds,  if  the  insurer  could  escape  lia- 
bility because  of  some  misstatement  or  omission  made  by  its 
own  agent,  perhaps  intentionally  to  secure  gains  to  the  com- 
pany without  risk,  relying  on  the  well-known  habit  of  men 
to  sign  the  application  without  investigation. 

On  the  whole  it  seems  to  me  there  is  a  distinction  between 

279 


§  144  G]       INSURANCE  :  FIRE,  LIFE,   ACCIDENT,   ETC.  [CH.  711. 

cases  where  the  agent  has  (or  is  held  out  as  having)  full  dis- 
cretion to  contract  just  as  if  he  were  himself  the  company, 
issuing  policies  without  referring  the  risk  to  the  home  office, 
and  cases  in  which  the  agent  is  not  properly  supposed  by  the 
assured  to  have  any  greater  power  than  to  solicit  insurance 
and  taice  the  facts,  forwarding  them  to  the  home  office, 
where  the  assent  is  really  given. 

In  the  first  class  of  cases  the  company  should  be  held. 
The  general  agent,  so  far  as  C.  is  concerned,  is  the  com- 
pany itself,  just  as  much  as  the  secretary  in  the  home  office 
is  in  the  other  class  of  cases.  The  contract  is  exactly  the 
same  as  if  A.  were  I.  ;  the  case  falls  under  our  first  divi- 
sion. If  a  right  of  cancellation  is  reserved  if  the  home  office 
should,  after  knowing  the  facts,  conclude  that  it  desired  to 
retire  from  the  contract  made  by  its  general  agent,  then,  as 
to  furnishing  the  basis  for  such  conclusion,  the  application 
would  fall  undei  the  principle  of  the  second  class  of  cases. 

Where  the  assured  knows  that  the  decision  rests  with  an- 
other than  the  agent  he  is  talking  with,  he  ought  to  exercise 
proper  care  that  the  facts  should  go  correctly  to  that  other. 
If  he  gives  the  facts  verbally  to  the  agent,  and  the  company 
issues  a  policy  without  requiring  a  signed  statement,  and 
without  writing  the  answers  as  a  part  of  the  policy,  of  course 
no  court  would  make  the  assured  responsible  for  errors  of 
the  agent  in  transmitting  his  answers  to  the  company.  If, 
however,  the  assured  signs  an  application  or  receives  what 
purports  to  be  a  copy  of  his  answers  in  or  with  the  policy  as 
part  of  the  contract,  he  ought  certainly,  speaking  absolutely, 
to  read  the  papers  and  see  that  they  are  right.  -  Who  would 
think  of  signing  a  deed  or  a  bond  without  knowing  its  con- 
tents ?  Yet  a  policy  may  be  as  valuable  as  a  deed,  and 
more  valuable  than  a  bond  if  the  obligor  goes  to  Canada. 
Absolutely  he  ought  to  read,  but  relatively  to  the  company 
does  he  owe  this  duty  in  such  sense  as  to  free  it  if  he  does 
not?  If  we  give  the  assured  the  money,  negligence  escapes 
its  punishment  entirely,  and  the  public  will  go  on  being 
negligent,  and  more  unjust  contracts  will  be  made  for  lack 
of  a  little  care  on  the  part  of  the  assured.  If  we  allow  the 
280 


CII.  VII.]  AGENTS.  —  THEIR   POWERS   AND   DUTIES.  [§  144  G 

company  to  keep  the  money,  we  open  a  way  to  corruption, 
and  put  a  heavy  loss  on  an  almost  innocent  party  who  has 
given  value  in  good  faith.  Justice  would  give  the  assured  his 
premiums  and  interest  from  the  company,  and  the  rest  of  his 
loss  from  the  agent. 

It  will  not  do  to  decide  the  question  before  us  by  referring 
to  the  rule  that  parol  is  inadmissible  to  vary  a  written  con- 
tract.    It  can  have  no  place  at  all,  unless  the  application  is 
made  part  of  the  policy.      The  principle  is  intended  to  do 
justice,  and  not  evil.      It  never  should  be  appealed  to,    to 
enable  a  party  to  take  advantage  of  his  own  wrong.     In  the 
very  jurisdictions  where  it  is  used  as  decisive  of  the  matter 
under  discussion,  it  continually  gives  way  in  cases  of  fraud, 
duress,  mistake,  &c.     Anything  showing  that  the  contract 
is  not  the  one  made  by  the  parties   is  admissible.      Parol 
ought  to  be  admitted  to  show  that  the  agent  did  not    cor- 
rectly take  down  the  insured's  answers,  — that  the  applica- 
tion is  not  the  instrument  of  the  assured,  —  to  prove  that 
the  minds  of  the  parties  never  met  on  the  contract  as  set 
down  in  the  policy  and  application.     To  avoid  the  contract 
and    resist   the   payment  of  premiums  there   is  no  sort  of 
doubt  that  the  insured  should  be  allowed  to  do  this;  but 
when  the  request  is  not  only  to  declare  the  supposed  con- 
tract off,  but  to  substitute  a  new  one,  holding  the  company 
to  a  risk  it  did  not  understand,  which  fact  the  insured  had 
easy  means  of  knowing,  then  the  question  is  not  one  of  the 
admission  of  parol  to  show  that  a  different  contract  was 
actually  made,  but  to  show  that  the  minds  of  the  contract- 
ing parties  really  did  not  meet  at  all.     I  am  speaking  of 
course  of  the  second  class  of  cases,  in  which  the  agent  is 
only  a  solicitor  and  forwarder.     It  is  a  serious  thing  to  ask 
a  court  to  hold  the  company  on  a  contract  it  never  made. 
To  be  sure,  the  company  invites  the  public  to  deal  with  its 
agents  in  the  customary  manner,   and   it  knows  that  it  is 
usual  to  rely  on  the  agents,  and  the  amount  of  litigation  on 
the  subject  is  alone  sufficient  proof  of  the  frequency  with 
which  men  trust  them.     Perhaps  it  might  be  deemed  fair  to 
hold  the  company  to  pay  the  loss, 

281 


J  144  G]      INSUKANCE :   FIRE,   LIFE,    ACCIDENT,   ETC.  [CH.  VII. 

But  I  am  inclined  to  think  that  where  there  is  no  ground 
for  believing  that  the  company  connives  at  the  wrong  of  the 
agent,  the  insured  who  has  neglected  to  read  his  statement, 
should  get  no  more  than  his  premiums  and  interest,  after 
deducting  the  additional  premiums  and  interest  on  them, 
which  the  assured  would  have  had  to  pay  if  the  representa- 
tions had  been  correct,  unless  the  risk  is  one  the  company 
would  not  have  taken  at  all  if  the  facts  had  been  known  to 
it,  and  this  is  apparent  on  the  policy.  Then  the  assured 
should  only  recover  from  the  company  his  premiums  and  in- 
terest, if  his  negligence  in  not  reading  the  papers  has  caused 
the  trouble.  In  such  cases  the  minds  of  the  parties  never 
met  to  the  effect  that  there  shall  be  any  insurance  at  all. 

Neither  will  it  do  to  refer  to  the  rule,  firm  and  good  as  it 
is  in  its  place,  that  the  knowledge  of  an  agent  is  that  of  his 
principal, 1  as  entirely  conclusive  of  the  matter.  If  the  in- 
sured knows  that  the  agent  does  not  communicate  his  knowl- 
edge to  the  company,  it  is  certain  that  its  ecjuity  is  better 
than  his,  and  if  he  might  know  it  by  ordinary  care,  and  the 
insurer  has  not  been  negligent  but  has  supplied  him  with 
proper  means  of  knowing  the  true  state  of  things  by  a  glance 
(and  the  very  fact  of  requiring  his  signature  is  notice  that 
the  company  relies  on  him,  not  on  the  agent),  it  seems 
equally  clear  that  his  equity  is  less  than  that  of  the  com- 
pany, and  that  he  should  have  an  action  only  against  the 
agent  for  loss  and  against  the  company  for  his  premiums. 
The  only  adverse  consideration  being  that  if  he  is  allowed 
to  hold  the  company  it  can  in  turn  hold  the  agent,  and  hav- 
ing dealings  with  him  will  be  better  able  perhaps  to  turn 
the  screws  upon  him,  and  so  bring  the  real  offender  to  jus- 
tice, than  if  it  is  left  to  a  suit  against  him  by  the  assured. 
Special  facts  may  exist  which  make  the  particular  case  very 
clear.  Wherever  the  agent  so  manoeuvres  as  to  deceive  the 
company,  and  at  the  same  time  place  it  beyond  the  power  of 
the  insured  by  ordinary  care  to  discover  that  he  has  done  so, 
—  and  in  any  case  where  reading  the  papers  would  not  give 
the  insured  notice  that  the  company  was  not  informed  truly, 

1  [See  §  122,  note.] 

282 


CH.  VII.]  AGENTS.  —  THEIE   POWERS   AND   DUTIES.        [§  144  G 

— the  troublesome  element  of  negligence  on  the  part  of  the 
assured  is  removed,  and  the  principle  that  as  between  two 
innocent  parties  he  who  enables  a  third  person  to  cause  loss 
must  bear  it,  seems  to  decide  the  question  against  the  com- 
pany. There  is  no  consideration  to  break  the  identity  of 
principal  and  agent.  Such  a  case  occurred  in  Iowa.  Where 
the  agent  fraudulently  misstated  the  age  of  the  assured, 
forged  a  physician's  certificate,  and  changed  the  policy  while 
in  his  hands  for  delivery  so  as  to  show  the  true  age,  and  the 
insured  knew  nothing  of  these  acts,  the  company  is  bound.  ^ 

So  if  the  agent  advises  the  assured  that  certain  matters 
■  need  not  be  stated,  and  he  as  a  man  of  ordinary  prudence 
and  intelligence  relies  on  the  agent's  assurance,  he  will  be 
protected.  2  If  the  applicant  cannot  read,  and  so  relies  on 
the  agent's  assurance  that  the  application  is  a  truthful  tran- 
script of  his  answers,  it  is  perhaps  asking  too  much  to  ex- 
pect him  to  take  a  friend  with  him,  or  get  some  disinterested 
person  to  read  it  to  him;  though  it  is  difficult  to  see  how  the 
company's  equity  is  the  less  because  the  plaintiff  cannot 
read,  or  how  one  who  writes  a  paper  for  the  assured,  or  reads 
it  to  him,  —  a  paper  to  which  the  assured  signs  his  name,  — 
can  be  agent  of  any  one  but  the  assured  in  so  doing,  unless 
the  agent  is  in  connivance  with  the  company.  And  there 
seems  to  be  a  general  feeling  running  through  the  cases  that 
insurance  companies  are  a  set  of  rascals,  who  wnnk  at  and 
encourage  the  tricks  of  agents  upon  the  public.  A  series  of 
such  acts  not  resulting  in  discharge  of  the  agent,  or  even  a 
single  flagrant  case,  would  raise  a  strong  suspicion  that  the 
company  was  the  real  deceiver,  especially  where  there  is  no 
motive  in  defrauding  an  applicant  except  to  secure  unjust 
profits  for  the  company.  I  believe  that  this  feeling  is  the 
real  basis  of  many  of  the  decisions,   and  where  it  is  well 

1  [:\[cArtlmr  v.  Home  Life  Ass.,  73  Iowa,   336.] 

2  [When  the  assured  told  the  agent  that  he  had  sunstroke,  and  the  latter  told 
him  it  was  not  necessary  to  say  anything  about  it,  the  company  is  estopped  from 
setting  it  up  in  defence.  Boos  v.  "World  Mut.  Life  Ins.  Co.,  6  T.  &  C.  364,  367. 
See§l20. 

Other  cases  of  peculiar  facts  will  be  found  in  the  foregoing  sections,  132  to 
134,  and  144  et  seq.] 

283     ' 


§  144  GJ      insurance:   fire,  life,  accident,  etc.       [ch.  vil 

founded,  the  estoppel  put  upon  the  company  is  certainly 
just.  But  where  there  is  no  reason  to  suppose  the  home 
office  to  be  other  than  fair  and  honest,  and  there  are  no 
peculiar  facts  in  the  case,  it  does  seem  that  one  who  in 
dealing  with  a  mere  soliciting  agent  signs  his  name  to  an 
application  without  reading  it,  ought,  as  between  the  com- 
pany and  himself,  to  abide  by  the  contents  of  it.  There 
being  no  usage  or  special  evidence  to  the  contrary,  the  very 
fact  that  his  siynature  to  the  paper  is  required  is  notice  to  him 
that  the  company  does  not  rely  upon  the  agent,  hut  requires  the 
applicatit's  ow7i  authority.  What  would  be  the  use  of  sign- 
ing a  statement,  if  the  parties  understood  that  the  solicitor 
was  the  company's  agent  to  ascertain  the  facts  and  state 
them  to  the  company  ?  The  requirement  of  a  signed  appli- 
cation is  clear  proof  that  the  company  wishes  to  have  the 
facts  in  the  assured 's  own  words,  or  in  words  that  he  adopts. 
It  is  perfectly  fair,  and  calculated  to  save  misunderstanding 
and  trouble,  that  they  should  have  such  an  authoritative 
statement,  and  the  assured  by  signing  the  application  im- 
pliedly says  to  the  company  that  it  is  his.  The  agent  in 
writing  the  answers  is  not  doing  the  work  of  the  company, 
but  of  the  assured,  just  as  much  as  if  a  stranger  wrote  at  his 
dictation.  Soliciting  agents  are  not  under  the  immediate 
supervision  and  control  of  the  home  office.  They  resemble 
independent  dealers  much  more  than  servants.  In  many 
respects  their  position  is  very  like  that  of  any  ordinary 
broker  to  whom  one  might  go  to  place  insurance.  Their 
interests  are  often  adverse  to  those  of  the  company,  leading 
them  to  color  the  facts  so  that  the  company  will  accept  the 
proposal,  and  they  will  get  their  commissions,  —  an  addi- 
tional reason  why  the  company  may  expect  the  applicant  to 
take  care  that  the  statement  signed  by  him  is  a  true  one. 
It  is  said  in  some  cases  that  if  the  policy  provides  that  the 
assured  adopts  and  warrants  the  application,  or  that  no 
statement  to  the  agent  not  transmitted  to  the  company  in 
the  application  should  bind  it,  omissions  and  errors  of  the 
agent  in  filling  out  the  statement  would  be  those  of  the 
assured.  But  if  the  assured  is  not  obliged  to  read  his 
284 


CH.  VII.]  AGENTS. — THEIR   POWEKS   AND   DUTIES.        [§  144  G 

papers,  how  is  he  to  be  supposed  to  know  these  conditions, 
or  any  others  for  that  matter?  It  seems  clear  that  I.,  if 
honest  and  fair,  should  not  be  held  for  an  omission  or  error, 
of  a  really  substantial  nature,  whether  made  by  the  assured, 
or  by  the  agent  through  mistake  or  otherwise  in  filling  up 
an  application  from  his  answers,  and  which  the  assured  might 
have  discovered  if  he  had  taken  the  trouble  to  read  the  state- 
ment he  signed.  The  words  of  the  United  States  Supreme 
Court  in  §  145  A.  commend  themselves  as  solid  sense.  At 
the  same  time,  the  plaintiff  being  innocent  of  any  intended 
wrong,  he  should  recover  his  premiums  and  interest;  and 
companies  would  probably  find  it  to  their  advantage  to  make 
the  same  terms  after  an  honest  loss,  as  they  would  have 
made  before  loss  if  the  application  had  been  correct.  In- 
deed if  the  rules  of  the  business  should  crystallize  suffi- 
ciently to  make  it  certain  what  contract  the  company  would 
have  made  on  the  true  state  of  facts,  the  law  might  recog- 
nize the  custom,  and  refuse  to  allow  the  company  to  recede 
after  loss  from  a  contract  it  is  certain  they  would  have  made 
before  loss,  the  plaintiff  being  innocent  of  wrong  intent,  that 
is,  many  errors  would  become  immaterial  except  to  vary  the 
premium,  and  the  difference  in  this  respect  could  be  taken 
out  of  the  amount  payable  on  the  policy.  ^  If  on  the  true 
statement  the  risk  is  no  greater  than  on  the  false  one,  the 
company  has  nothing  to  complain  of,  and  should  be  held. 

In  the  case  cited  in  §  144  from  the  United  States  Supreme 
Court,  the  applicant  told  the  agent  that  she  did  not  know 
anything  about  the  cause  of  her  mother's  death  or  her  age 
at  the  time,  but  while  the  agent  was  taking  the  application 
there  was  present  an  old  woman  who  claimed  to  know  about 
the  matter,  and  the  agent  filled  in  the  answers  she  gave 
without  assent  of  the  plaintiff  or  his  wife,  whose  life  was 
being  insured.  When  the  application  was  signed  the  in- 
sured did  not  know  how  the  answers  to  the  disputed  ques- 
tions had  been  filled  in,  and  the  court  held,  as  we  have  seen, 
that  the  company  was  bound,  and  it  should  have  been.  If 
the  insured  had  read  the  statement  he  could  have  discovered 

^  [See  §  138  B.  for  a  tendency  in  this  direction.] 

285 


§  144  G]        INSURANCE  :     FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  VII. 

nothing  different  from  what  had  actually  passed,  and  if  the 
agent,  who  must  be  supposed  to  know  all  about  the  business 
he  is  engaged  in,  deems  it  proper  to  insert  the  answer  of 
some  third  person,  it  would  probably  never  occur  to  recently 
freed  slaves,  as  the  insured  and  his  wife  were,  to  question 
the  correctness  of  his  action,  or  to  request  that  the  answers 
in  question  be  so  marked  as  to  indicate  that  their  signatures 
to  the  statement  as  a  whole  did  not  apply  to  sanction  the 
said  answers. 

It  makes  no  difference  that  the  policy  declares  the  agent 
to  be  the  agent  of  the  assured,  not  of  the  company.  For 
whom  a  person  is  acting  is  a  matter  of  law  on  the  facts  of 
every  case.^  The  application  precedes  the  policy,  and  to 
hold  that  a  provision  in  the  aftercoming  policy  unknown  to 
the  assured  at  the  time  of  application  could  turn  the  insur- 
ance agent  into  his  agent,  when  he  thought  all  the  time  he  ■ 
was  dealing  with  him  and  accepting  his  advice  as  agent  of 
the  company,   would  be  an  outrage. 

If  an  agent  says  he  is  authorized  to  make  surveys,  <fcc., 
measures  the  distances  between  the  property  of  the  assured 
and  surrounding  buildings,  and  makes  a  plan,  marking  upon 
it  the  said  distances,  and  the  assured  signs  the  whole  appli- 
cation without  testing  the  distances,  the  company  ought  to 
be  held,  if  the  agent  although  only  a  solicitor  really  did 
have  authority  to  make  the  measurements  himself,  and  was 
not  expected  by  the  company  to  do  it  in  the  presence  of  the 
assured ;  that  is,  if  the  company  understood  that  the  meas- 
urements were  to  be  taken  on  the  authority  of  the  agent  and 
not  of  the  assured,  although  over  the  latter's  signature. 
And  a  usage  would  be  good  evidence  in  the  matter. ^ 

If  the  agent  making  out  the  application  is  not  the  recog- 
nized agent  of  the  company,  of  course  he  acts  only  for  the 
assured,  and  the  latter  is  bound  by  his  acts.^ 

Where  the  applicant  reads  the  statement  and,  on  noticing 

1  [Union  Mut.  Life  Ins.  Co.  v.  Wilkinson,  13  Wall.  222 ;  Comm.  Fire  Ins. 
Co.  V.  Ives,  56  111.  403.  ] 

2  [Plumb  V.  Cattaraucrus  Co.  Mut.  Fire  Ins.  Co.,  18  N.  Y.  392.] 
'  [Foot  V.  BXudL.  Life  Ins.  Co.,  4  Daly,  285. J 

286 


CH.  VII.]         AGENTS.  —  THEIK   POWERS    AND    DUTIES.         [§  144  G 

that  it  contains  omissions  or  changes,  is  assured  by  the 
agent  that  it  is  all  right,  that  the  variances  from  the  verbal 
statement  make  no  difference,  the  company  is  properly  held 
bound  by  the  representation  of  its  agent,  unless  the  assured 
knows  or  ought  to  know  that  the  representation  is  not  true. 
If  the  assured  feels  in  his  heart  that  it  is  not  all  right,  the 
company  is  really  being  cheated  by  the  agent  and  the  assured 
putting  their  heads  together,  the  one  to  get  his  commissions 
on  a  shady  risk,  the  other  to  get  his  insurance,  and  at  as 
low  a  premium  as  possible. 

So  where  the  physician  told  the  agent  that  the  person 
whose  life  was  to  be  insured  was  temperate  now,  but  that 
he  -would  have  to  answer  the  question  "Has  he  always  been 
temperate  ? "  in  the  negative,  and  the  agent  told  the  doctor 
to  leave  a  blank  after  that  question,  saying  that  it  was  a 
mere  matter  of  form  any  way,  and  the  doctor  did  so,  and 
signed  the  statement  in  that  condition,  and  the  evidence 
tended  to  show  that  the  agent  had  afterward  without  author- 
ity filled  in  a  wrong  answer  to  the  question,  it  was  properly 
held  that  the  company  was  bound.  ^  If  the  statement  had 
been  left  as  the  physician  made  it  and  the  company  had 
issued  a  policy,  it  would  have  waived  the  blanked  question. 
The  doctor  had  been  guilty  of  no  negligence  at  all.  The 
whole  fault  was  that  of  the  agent,  and  the  company  ought  to 
be  held.  But  the  decision  is  not  placed  on  the  true  ground 
of  the  fault  of  the  agent,  beyond  the  reach  of  ordinary  care 
on  the  part  of  the  doctor.  On  the  contrary  the  broad  doc- 
trine is  asserted  that  the  company  is  conclusively  presumed 
to  know  what  the  agent  knows  at  the  time  of  making  the 
application.  This  stretching  of  decisions  beyond  their  facts 
is  wha^  has  ^iven  rise  to  the  difficulty  in  this  as  in  many 
legal  questions.  In  nearly  all  of  the  cases,  particular  facts 
will  be  found  which  justify  the  judgment,  but  make  the  case 
fall  short  of  being  an  authority  for  the  rule  laid  down  by  the 
courts  in  most  of  the  States,  to  the  effect  that  facts  known 
to  an  agent  (not  limiting  it  to  general  agents  making  con- 
tracts) contrary  to  the  statements  signed  by  the  applicant 

1  LMiller  v.  Mutual  Benefit  Life  Ins.  Co.,  31  Iowa,  216  ;  s.  c.  1  Ins.  L.  J.  25.] 

287 


§  145]  INSURANCE :   FIEE,   LIFE,   ACCIDENT,  ETC.  [CH.  VII. 

bind  the  company,  even  though  the  company  is  to  receive 
the  statements  on  the  authority  of  the  applicant,  and  by 
reading  the  application  he  might  have  saved  all  trouble. 
The  true  rule  is,  that  (where  there  are  no  special  facts,  such 
as  connivance  by  the  company,  impossibility  or  improbabil- 
ity of  discovering  the  error  or  saving  the  fraud  even  if  the 
paper  had  been  read  and  due  care  exercised,  advice  or  assur- 
ances of  the  agent,  or  acts  equivalent  thereto,  that  the  as- 
sured could  not  be  expected  to  know  were  not  proper  and  in 
good  faith,  a  usage  to  let  the  agent  make  surveys  on  his  own 
responsibility,  &c. ),  a  person  is  bound  to  know  what  he 
signs,  and  if  by  lack  of  ordinary  care  in  not  reading  under 
the  circumstances,  as  by  not  reading  the  paper,  he  misleads 
the  company,  he  ought  not  to  throw  the  loss  upon  it,  and 
should  have  no  more  than  his  premiums  and  interest.  If  he 
acted  in  had  faith  he  should  have  nothing.  But  if  he  acted 
in  good  faith  and  with  ordinary  care  the  company  should 
bear  the  burden  of  its  agent's  acts  and  omissions.] 

§  145.  Courts  of  Massachusetts  and  Rhode  Island  more 
Strict.  —  But  the  courts  of  Massachusetts  and  Rhode  Island, 
notwithstanding  the  admitted  hardship  of  the  case,  have 
refused  to  yield  to  the  strong  equity  of  the  claim  of  the 
assured  under  like  circumstances.  Looking  upon  the  at- 
tempt to  show  by  parol  evidence  that  the  facts  untruly  stated, 
or  carelessly  or  incautiously  omitted,  were  known  to  the  in- 
surers or  their  agent  when  the  policy  was  issued,  as  a  direct 
violation  of  the  rule  that  parol  evidence  cannot  be  admitted 
to  contradict  or  vary  the  terms  of  a  written  agreement,  they 
have  persistently  excluded  such  evidence,  even  in  cases 
where  the  insurers  were  notified  by  the  insured,  and  assented 
to  the  omission.  Thus,  a  failure  to  mention  in.  the  applica- 
tion the  fact  that  part  of  the  premises  insured  was  used  as 
a  grist-mill,  the  same  being  included  in  a  memorandum  of 
special  hazards,  the  neglect  to  mention  which  involved  a 
forfeiture  of  all  rights  under  the  policy,  was  held  to  be 
fatal  to  the  claim  of  the  assured,  though  the  agent  was  fully 
authorized  to  make  contracts  of  insurance,  without  reference 
to  the  company  for  its  sanction,  and  examined  the  property, 
288 


CH.  VII.]         AGENTS.  —  THEIR    POWERS    AND   DUTIES.  [§  145 

saw  the  grist-mill,  agreed  and  suggested  what  was  material 
to  be  stated,  and  in  fact  filled  up  the  application  himself. ^ 
And  the  same  doctrine  has  been  repeatedly  held  where  the 
insurers  themselves  had  knowledge  of,  and  assented  to,  the 
fact  which  was  afterwards  allowed  to  be  set  up  as  a  defence 
to  the  claim  of  the  insured.^  They  hold  with  equal  strict 
ness  that  agents  of  mutual  insurance  companies  employed 
by  them  to  procure  and  forward  applications,  and  authorized 
to  receipt  for  premiums,  although  it  is  their  custom  to  fill 
up  the  applications  and  make  such  explanations  as  may  be 
necessary,  are  nevertheless  generally  to  be  regarded  as  the 
agents  of  the  applicants  also,  at  least  so  far  as  to  make 
the  applicants  responsible  for  the  statements  contained  in 
the  application.  The  mistake  of  the  agent  is  their  mistake; 
and  though  in  point  of  fact  the  answer  or  statement  was 
truthfully  and  accurately  made  to  the  agent,  and  if  set  down 
as  given  would  have  been  correct,  yet  if,  by  inadvertence  or 
infirmity,  it  is  untruly  set  down,  a  court  of  law  must  hold 
the  applicant  to  the  terms  of  his  contract,  and  cannot  admit 
evidence  to  show  that  it  was  really  different  from  what  it 
appears  to  be.^  Where  the  agent  acting  for  the  company 
was  required  himself  to  answer  the  question,  "whether  your 
answers  by  the  applicant  are  correct,"  this  implies  that  it 

1  Lee  V.  Howard  Fire  Ins.  Co.,  3  Gray  (Mass.),  583.  See  also  Southern  Mut. 
Ins.  Co.  V.  Yates,  28  Grat.  (Va.)  585. 

2  Barrett  v.  Union  Mut.  Fire  Ins.  Co.,  7  Cush.  (ifass.)  175.  [Such  a  decision 
certainly  carries  the  rule  in  regard  to  parol  beyond  all  reason  and  ju.stice.] 

3  Homes  et  al.  v.  The  Chavlestown  Mut.  Fire  Ins.  Co.,  10  Met.  (Mass.)  211  ; 
Jenkins  v.  The  Quincy  Mut.  Fire  Ins.  Co.,  7  Gray  (Mass.),  370  ;  Wilson  o.  Con- 
way Mut.  Fire  Ins.  Co.,  4  R.  I.  141  ;  Barrett  v.  The  Union  Mut.  Fire  Ins.  Co.,  7 
Cush.  (Mass.)  175  ;  Kibbe  v.  Hamilton  Mut.  Ins.  Co.,  11  Gray  (Mass.),  163; 
Abbott  V.  Shawmut  Mut.  Fire  Ins.  Co.,  3  Allen  (Mass.),  213.  So  in  Ohio,  Smith 
V.  Farmers'  Mut.  Ins.  Co.,  19  Ohio  St.  287  ;  and  in  New  Jersey,  Franklin  Fire 
Ins.  Co.  V.  Martin  (N.  J.),  8  Ins.  L.  J.  134,  where  this  view  of  the  case  is  argued 
at  great  length,  and  the  cases  to  the  contrary,  including  Insurance  Co.  v.  Wil- 
kinson, ante,  §  144,  criticised.  In  Pennsylvania,  also,  a  tendency  to  a  like  strict- 
ness has  been  shown.  Smith  v.  Insurance  Co.,  24  Pa.  St.  320  ;  but  see  contra. 
Spring  Garden  Ins.  Co.  v.  Scott,  Phila.  Leg.  Int.,  March  14,  1870,  and  ;)os^  §  148 
et  seq.  And  in  Kentucky,  Prot.  Ins.  Co.  v.  Hall,  15  B.  Mon.  (Ky. )  411.  So  in  the 
Dominion  courts.  Martin  v.  Mut.  Fire  Ins.  Co.,  3  Pugsley  (N.  B.),  157  ;  Dingee 
V.  Agr.  Ins.  Co.,  id.  80  ;  Kennedy  v.  Agr.  Ins.  Co.,  1  R.  &  C.  (Nova  Scotia)  433  ; 
Billington  v.  Provincial  Ins.  Co.,  2  Ont.  App.  158  ;  s.  c.  3  Can.  Sup.  Ct.  Rep.  182. 

VOL.  I. -19  289 


§  145]  INSURANCE  :   FIRE,   LIFE,   ACCIDENT,    ETC.  [CH.  VII, 

Avas  his  duty  to  write  the  answers  of  the  applicant,  and  for 
his  negligence,  fraud,  or  mistake,  which  the  insured  may 
prove,  the  company  will  be  held  responsible.  ^ 

And  in  a  later  case  in  Massachusetts,  where  the  premium 
had  actually  been  paid  to  the  agent  of  the  company,  but  was 
not  paid  over  or  tendered  to  the  company  until  eight  days 
after  the  date  of  the  policy,  and  after  the  loss,  the  policy 
providing  that  every  agent  forwarding  applications,  or  re- 
ceiving premiums,  is  the  agent  of  the  applicant  and  not  of 
the  company,  reaffirms  the  doctrine  of  the  above  cases,  and 
denies  the  authority  of  the  agents  and  officers  of  a  mutual 
insurance  company  to  waive  the  by-laws  and  provisions 
which  relate  to  the  substance  of  the  contract,  adopted  by  the 
members  of  such  company  for  their  mutual  protection. ^  Nor 
has  such  an  agent  authority  to  perfect  the  contract  in  behalf 
of  the  company,  especially  if  the  receipt  specifies  that  the 
premium  is  to  be  refunded  if  the  office  does  not  approve;  a 
sufficiently  clear  intimation,  it  seemed  to  the  court,  of  the 
agent's  want  of  authority  to  make  the  contract. ^  Nor  is  the 
delivery  of  a  new  premium  note  to  him  by  the  assignees, 
after  an  alleged  transfer  of  the  policy,  where  the  validity  of 
the  assignment  depends  upon  the  question  whether  the  com- 
pany at  the  time  of  their  assent  had  knowledge  of  the  deliv- 
ery of  the  note,  a  delivery  to  the  company  so  as  to  affect 
them  with  knowledge  of  the  fact.*  Nor  can  an  agent  to  take 
and  transmit  policies,  to  whom  the  insured  surrenders  his 
policy  for  cancellation,  bind  the  company  by  his  promise  to 
deliver  up  the  premium  note,  although  the  policy  be  actually 
cancelled.  The  cancellation  of  the  policy  does  not  relieve 
the  note  from  liability  to  assessment  for  losses  prior  to  the 
surrender,  and  the  agent  is  clothed  with  no  authority  to  give 

1  Smith  V.  Farmers',  &o.  Ins.  Co.  (Pa.  St.),  8  Ins.  L.  J.  828;  Eilenberger  v. 
Protective  Mut.  Kire  Ins.  Co.  (Pa.  St.),  8  Ins.  L.  J.  822. 

2  Mulrey  v.  Shawniut  Fire  Ins.  Co.,  4  Allen  (Mass.),  116.  In  the  cases  above 
cited  from  the  10th  of  Met.  and  7th  of  Gush.,  it  is  intimated  that  equity  might 
relieve  in  such  a  ease  ;  and  so  it  undoubtedly  will.  See  also  Wilson  v.  Conway 
Mut.  Fire  Ins.  Co.,  4  R.  I,  141. 

3  N.  Y.  Union  Mut.  Ins.  Co.  v.  Johnson,  23  Pa.  St.  72. 

♦  Fogg  et  als.  v.  Middlesex  Mut.  Fire  Ins.  Co.,  10  Cash.  (Mass.)  337. 

290 


CH.  VII  ]  AGENTS.  —  THEIR   POWERS    AND   DUTIES.         [§  145  A 

up  the  securities  of  the  company.  ^  It  is  doubtful  whether 
the  company  itself  could  surrender  the  note  under  such  cir^ 
cumstances.  This  might  be  tantamount  to  a  wilful  omis- 
sion of  the  note  in  calculating  the  assessment,  and  if  so,  it 
would  vitiate  the  assessment.^ 

But  if  the  agent  sends  in  an  application  which  was  never 
authorized,  instead  of  a  defective  application  which  was 
authorized,  the  company  will  be  bound  as  if  no  application 
was  ever  made,  if  the  policy  be  issued  upon  the  first,  or,  if 
upon  the  last,  then  they  will  be  bound  if  the  defective  appli- 
cation be  good  so  far  as  it  goes.^  The  applicant  is  bound  by 
an  application  which  he  authorizes,  though  he  may  not  know 
its  contents.* 

[§  145  A.  In  a  case  in  the  United  States  Supreme  Court, 
A.  applied  for  insurance  on  his  life,  and  answered  all  mate- 
rial questions  orally  and  correctly.  The  agent  set  down 
false  answers  and  A,  signed  the  application  without  reading 
or  knowing  its  contents.  The  policy  issued  thereon  was 
conditioned  that  the  answers  were  part  of  it,  and  tliat  no 
statement  to  the  agent  not  thus  transmitted  should  be  binding 
on  his  principal ;  and  a  copy  of  the  ansivers  with  these  condi- 
tions co7ispieuovs^i/  printed  upon  it  accompanied  the  policy.  It 
was  held  that  the  policy  was  void.  "It  was  the  duty  of  the 
applicant  to  read  the  application  he  signed.  He  knew  that 
upon  it  the  policy  would  be  issued  if  issued  at  all.  It  would 
introduce  great  confusion  in  all  business  transactions,  if  a 
party  making  written  proposals  for  a  contract,  with  repre- 
sentations to  induce  its  execution,  could  be  allowed  to  show, 
after  it  had  been  obtained,  that  he  did  not  know  the  con- 
tents of  his  proposals,  and  to  enforce  it,  notwithstanding 
their  falsity  as  to  matters  essential  to  its  obligation  and 
validity.  "5  This  seems  to  be  sense  and  law.  No  rule  re- 
lieving one  party  to  a  contract  of  the  duty  to  exercise  ordi- 

1  Marblehead  Mut.  Fire  Ins.  Co.  v.  Underwood,  3  Gray  (Mass.),  210. 

2  Post,  §  558. 

8  Blake  v.  Exchange  Mut.  Ins.  Co.,  12  Gray  (Mass.),  265. 
*  Draper  v.  Charter  Oak  Ins.  Co.,  2  Allen  (Mass.),  569. 
5  [N.  Y.  Life  Ins.  Co.  v.  Fletcher,  117  U.  S.  529.] 

291 


§  146]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  VII. 

nary  care  and  prudence  is  recognized  in  regard  to  any  other 
soi-t  of  negotiations,  and  I  see  no  reason  why  it  should  be 
applied  merely  to  contracts  of  insurance.  It  surely  is  not 
prudent  to  sign  what  another  has  written  without  reading  it. 
If  the  agent  had  altered  the  application  after  A.  had  once 
made  sure  it  was  right  and  signed  it,  the  case  would  wear  a 
different  aspect.  Where  the  insured  agrees  to  make  his 
answers  the  basis  of  the  contract  and  declares  them  true, 
any  falsity,  conscious  or  not,  will  avoid  the  policy.  Such 
answers  are  warranties.^  In  case  the  application  is  made 
part  of  the  policy  and  it  is  provided  that  any  untrue  answers 
will  avoid  the  contract,  no  action  will  lie  against  the  com- 
pany if  there  is  an  untrue  representation,  although  it  was 
made  by  the  agent  without  the  knowledge  of  the  applicant 
who  had  orally  stated  the  truth  to  the  agent.  Oral  evidence 
will  not  be  admitted  even  to  show  that  the  company  knew 
that  the  representations  were  untrue  when  it  issued  the  pol- 
icy. ^  This  is  carrying  the  rule  against  parol  to  an  absurd 
length.  All  rules  of  law  were  framed  for  purposes  of  jus- 
tice, and  to  so  construe  them  as  to  forward  iniquity  is  to 
use  them  to  defeat  the  very  purposes  they  were  designed  to 
accomplish.  Where  A.  applied  for  insurance  telling  the 
agent  that  there  was  other  insurance  on  the  property  in  the 
Gore  Mutual,  but  he  did  not  know  how  much,  and  intrusting 
it  to  the  agent  to  find  out  the  amount  and  state  it  to  the 
company,  and  the  agent  made  out  the  application  without 
mentioning  the  other  insurance,  it  was  held  that  the  company 
was  not  estopped, and  that  the  policy  could  not  be  reformed.^] 

§  146.  So  as  to  the  Power  of  Officers  of  Mutual  Companies.  — 
And  in  Massachusetts  the  officers  of  mutual  insurance  com- 
pnnios  are  held  to  the  strictest  compliance  with  the  require- 
ments of  the  by-laws,  and  limited  to  the  exercise  of  such 
powers  as  are  thereby  conferred.  Mutual  insurance,  it  is 
truly  observed,  is  essentially  different  from  stock  insurance, 

^  [Weeras  v.  Standard  L.  Ass.  Co.,  21  Scot.  L.  R.  791.     Spp  also  Id.  45?..] 
2  [McCoy  V.  Metropolitan  Life  In.'?.  Co.,  133   Mass.  85  ;  Batchelder  v.  Queen 
Ids.  Co.,  135  Mass.  449.] 

8  [Billington  v.  Provincial  Ins.  Co.,  3  Can.  Supr.  Ct.  R.  182.] 
292 


CH.  VII.]  AGENTS.  —  THEIR    POWERS    AND   DUTIES.  [§  146 

and  much  of  the  litigation  that  has  grown  out  of  this  species 
of  insurance  has  been  owing  to  inattention  to  this  difference. 
Its  original  design  was  to  provide  cheap  insurance  by  means 
of  local  associations,  the  members  of  which  should  insure 
each  other.  Such  associations  are  in  their  nature  adapted 
only  to  local  business.  They  need  many  by-laws  and  condi- 
tions that  are  not  required  in  stock  companies;  and  it  is 
necessary  and  equitable  that  each  person  who  gets  insured 
in  them  should  become  subject  to  the  same  obligations 
towards  his  associates  that  he  requires  from  them  towards 
himself.  If  the  officers  have  discretionary  power  as  to  the 
terms  of  the  contract,  or  even  as  to  its  form,  it  is  obvious 
that  different  parties  may  become  members  upon  different 
terms  and  conditions,  and  thus  the  principle  of  mutuality 
will  be  completely  abrogated.  When  the  company  have  once 
determined  the  forms  in  which  their  policies  shall  be  made, 
and  the  conditions  upon  which  they  are  willing  to  contract, 
it  is  nothing  less  than  a  violation  of  duty  for  the  officers  to 
undertake  to  bind  the  companies  they  represent  by  other  and 
inconsistent  contracts,  parol  or  otherwise.^  Hence  where 
the  by-laws  of  a  company  provide  that  subsequent  insurance 
obtained,  and  subsequent  alterations  made,  without  the  eon- 
sent  in  writing  of  their  president,  shall  avoid  the  policy,  the 
verbal  consent  of  the  president  is  unauthorized. ^  Nor  when 
the  by-laws  require  that  the  premium  shall  be  paid  before 
the  policy  shall  take  effect,  has  any  officer  the  power  to  bind 
the  company  by  an  agreement  that  notwithstanding  the  non- 
payment of  the  premium  the  policy  shall  be  effected.^  Nor 
to  estop  the  company  by  a  representation  that  insurance  has 
been  obtained,  when  in  fact  the  premium  has  not  been  paid.* 
For  the  same  reason,  where  the  charter  provides  that  an 
applicant  shall  deposit  his  note  before  he  receives  a  policy, 
no  officer  can  waive  the  condition  by  an  assurance  that  the 
risk  shall  commence  immediately  and  before  the  policy  is 

1  Evans  v.  Trimountain  Mut.  Fire  Ins.  Co.,  9  Allen  (Mass.),  329. 

2  Hale  V.  Mechanics'  Mut.  Ins.  Co.,  6  Gray  (Mass.),  169. 

8  Brewer  v.  Chelsea  Mut.  Fire  Ins.  Co.,  14  Gray  (Mass.),  203. 
*  Baxter  v.  Chelsea  Mut.  Fire  lus.  Co.,  1  Allen  (ilass.),  294. 

293 


§  148]  INSURANCE :    FIEE,  LIFE,   ACCIDENT,   ETC.  [CH.  VII. 

issued.  1  The  same  rule,  however,  does  not  apply  where  the 
provision  for  the  prepayment  of  the  premium  is  not  a  condi- 
tion,  or  by  law  or  otherwise  a  part  of  the  policy,  but  is  a 
merely  collateral  agreement  appended  to  the  application. 
In  such  case  the  prepayment  of  the  premium  may  be  waived 
by  any  officer  or  agent  the  general  scope  of  whose  duties 
o-ives  him  a  right  to  act  in  the  premises. ^ 

§  147.  This  Rule  applicable  only  to  By-laws  which  are  of 
the  Essence  of  the  Contract.  —  But  the  courts  of  Massachu- 
setts make  a  distinction  between  by-laws  and  provisions 
which  go  to  the  substance  and  essence  of  the  contract  and 
those  which  do  not.  Of  the  latter  class  are  stipulations  as 
to  preliminary  proof  of  loss.  As  these  relate  only  to  the 
form  or  mode  in  which  the  liability  of  the  company  shall  be 
ascertained  and  proved,  and  must  necessarily  be  submitted 
to  the  officers  of  the  corporation,  who  must  pass  upon  their 
sufficiency ;  and  as,  furthermore,  in  ascertaining  and  settling 
losses,  they  frequently  act  upon  personal  investigations  made 
by  themselves  or  their  agents,  thereby  obtaining  knowledge 
which  renders  the  preliminary  proof  wholly  immaterial,  it 
is  held  to  be  within  the  scope  of  their  authority  to  say  when 
the  proof  is  sufficient,  and  if  they  deem  it  expedient,  to  dis- 
pense with  the  literal  requirements  of  the  by-laws  in  this 
particular.3  But  a  mere  statement  by  an  agent,  after  notice 
to  him  of  loss,  "that  the  matter  would  be  all  right  with  the 
company,"  does  not  relieve  the  party  insured  from  the  neces- 
sity of  making  his  preliminary  proof;*  nor  does  the  mere 
fact  that  the  agent  resided  at  the  place  of  the  fire,  and  per- 
sonally knew  all  the  circumstances  attending  it.^- 

§  148.  In  Pennsylvania,  also,  the  distinction  between 
mutual  and  stock  companies  is  regarded  as  essential.      In 

1  Belleville  Mut.  Ids.  Co.  v.  Van  Winkle,  1  Beasley  (N.  J.),  333. 

2  Sheldon  v.  Conn.  Mut.  Life  Ins.  Co.,  25  Conn.  207. 

3  Priest  €t  al.  v.  The  Citizens'  Mut.  Fire  Ins.  Co.,  3  Allen  (Mass.),  602,  605. 
The  case  of  Dawes  v.  North  River  Ins.  Co.,  7  Cowen  (N.  Y.),  462,  does  not  ad- 
vert to  this  distinction,  and  cannot  now  he  regarded  as  sound  law. 

4  Boyle  V.  North  Carolina  Mut.  Ins.  Co.,  7  Jones,  Law  (N.  C),  373.  And  see 
post,  §  471. 

6  Smith  V.  Haverhill  Mut.  Fire  Ins.  Co.,  1  Allen  (Mass.),  297. 

294 


CH.  VIL]  agents. — THEIR   POWERS   AND   DUTIES.  [§  149 

the  case  of  Hackney  v.  The  Alleghany  Mutual  Insurance 
Company,  1  the  question  of  the  responsibility  of  mutual  in- 
surance companies  for  the  unauthorized  and  false  declara- 
tions of  their  agents  arose  under  the  following  facts.  The 
agent  of  the  company  bore  a  certificate  of  the  fact  of  his 
agency,  signed  by  the  president  of  the  company,  and  author- 
izing him  "to  receive  applications  for  insurance  and  the  pre- 
mium thereon. "'  In  defence  it  was  proposed  to  prove  that  at 
the  time  the  agent  requested  the  plaintiff  in  error  to  become 
a  member,  he  represented  that  the  company  was  not  insur- 
ing in  the  city  of  Pittsburg  and  other  large  cities,  and  that 
upon  this  representation  the  premium  note  was  given.  But 
the  court  held  that  the  evidence  was  rightly  rejected,  as  the 
declarations  of  the  agent  were  not  within  the  scope  of  his 
authority,  which  extended  only  to  receiving  applications  and 
premiums.  And  had  the  declaration  been  made  by  the 
president  himself,  it  would  not  have  been  binding  upon  the 
company ;  for,  say  the  court,  "  there  is  no  such  privity  among 
the  corporators  or  the  officers  of  the  company  as  to  make  the 
admission  of  either  binding  upon  all.  If  such  verbal  con- 
versations were  admitted  in  evidence  against  the  written 
engagements  of  the  corporators,  their  policies  would  be 
worthless,  and  the  utility  of  mutual  insurance  companies  at 
an  end." 

§  149.  In  the  same  State  it  has  also  been  held,  upon 
grounds  which  would  seem  to  be  sufficient  without  relying 
upon  the  distinction,  that  where  the  insurance  is  in  a  mutual 
office,  and  the  agent  of  the  office  fills  up  the  application, 
itself  expressly  made  a  warranty,  and,  with  the  knowledge 
of  the  assured,  states  what  is  by  both  of  them  known  to  be 
material  and  untrue,  as,  that  there  is  a  chimney  and  stove 
well  secured,  with  the  pipe  passing  through  a  crock  well 
secured,  when,  in  fact,  there  is  neither  chimney  nor  stove, 
the  misstatement  will  be  fatal;  nor  will  it  be  excused  by  an 
agreement,  not  communicated  to  the  company,  between  the 
agent  and  the  assured,  that,  before  a  fire  should  be  kept  in 
the  building,  a  chimney  should  be  erected  and  the  stove-pipe 

1  4  Ban-  (Pa.),  185. 

295 


§  150]  INSURANCE  :    FIRE,   LIFE,  ACCIDENT,   ETC.  [CH.  VII. 

secured  as  represented.  Such  an  agreement  the  agent  clearly 
has  no  authority  to  make.^  In  this  case  the  case  of  Howard 
Insurance  Company  v.  Bruner^  was  referred  to  and  distin- 
guished. "  That, "  said  the  court,  "  was  not  a  mutual  com- 
pany. The  agent  who  wrote  out  the  description,  instead  of 
being  limited  to  a  mere  reception  of  applications,  was  clothed 
with  large  powers,  settled  the  terms  of  insurance,  and  coun- 
tersigned and  issued  the  policies  without  referring  applica- 
tions to  the  company.  Under  the  circumstances  ...  we 
held  that  the  written  survey  was  the  act  of  the  agent,  and 
that  the  assured  was  not  to  be  prejudiced  by  the  omission  of 
facts  which  he  stated  but  which  the  agent  omitted  to  set 
down."  Reference  was  also  made  to  Susquehanna  Insurance 
Company  v.  Perrine,^  in  which  the  applicant  was  held  re- 
sponsible for  the  omissions  of  the  agent,  stress  being  laid 
upon  the  fact  that  the  company  was  a  mutual  one,  and  by 
one  of  its  by-laws  made  the  applicant  responsible  for  the 
agent's  accuracy  in  making  the  surve3^  Yet  in  that  case 
Gibson,  C.  J.,  said:  "A  regulation  established  by  a  by-law 
is  not  obligatory  on  a  stranger;  and,  if  the  plaintiff  were 
such,  he  would  not  be  affected  by  the  blunder  of  the  com- 
pany's surveyor,  notwithstanding  the  terms  of  application 
prescribed  by  the  conditions  of  insurance ;  "  a  doctrine  which 
is  in  harmony  with  Howard  Insurance  Company  v.  Bruner.* 

§  150.  But  in  Pennsylvania,  where  insurance  was  effected 
by  the  agent  of  a  stock  company  upon  "  barley  and  malt  in 
assured's  malt-house  and  brewery,"  subject  to  the  condition 
that  if  the  risk  was  increased  without  notice  to  the  company 
and  an  indorsement  of  consent  on  the  policy,  .the  policy 
should  be  of  no  force,  and  notice  was  given,  before  the  exe- 
cution of  the  policy  to  the  agent  of  the  company,  that  the 
insured  intended  to  distil  and  store  whiskey  in  the  buildings 
containing  the  property  insured,  during  the  currency  of  the 

1  Smith  V.  Cash  Mut.  Fire  Ins.  Co.,  24  Pa.  St.  320. 

2  11  Har.  (Pa.)  50. 

3  7  W.  &  S.  348. 

*  11  Harris,  50.  In  fact,  the  latter  case  was  tried  before  that  distinguished 
judge,  and  the  ruling  excepted  to  and  sustained  was  his  ruling  See  also  ante, 
§  132,  and  Moliere  v.  Pa.  Fire  Ins.  Co.,  5  Rawle,  342.- 

296 


CH.  VII.]  AGENTS. — THEIR    POWERS   AND   DUTIES.  [§  151 

policy,  it  was  held,  that  although  there  was  no  indorsement 
of  the  consent,  the  company  had,  through  notice  to  its  agent, 
knowledge  that  distilling  had  been  added  to  the  business  of 
brewing  before  the  policy  issued,  and  consequently  this  was 
one  of  the  risks  which  they  intended  to  insure  against,  and 
therefore  no  indorsement  was  necessary.  ^ 

§  151.  General  Agent  with  Unlimited  Powers.  —  A  general 
agent,  there  being  no  limitation  of  his  authority,  may  even 
by  an  oral  agreement  extend  the  scope  of  a  policy  already 
issued,  so  as  to  make  it  cover  property  not  embraced  in  the 
policy  when  issued,  such  policy  being  an  open  one  and  in- 
tended to  cover  property  of  a  certain  character,  which  might 
be  at  risk  at  different  times,  the  property  being  of  the  gen- 
eral character  of  that  insured  in  the  original  policy.  And 
his  oral  agreement  will  bind  the  company,  although  the  pol- 
icy purports  to  be  upon  property  "as  per  indorsements  to  be 
made  thereon,"  and  there  is  no  indorsement  of  the  property 
which  the  agent  verbally  agrees  to  insure.^  And  he  may 
correct  an  error  in  the  policy  after  its  issue ;3  or  make  the 
policy,  by  its  terms  non-assignable  without  the  company's 
consent,  payable  in  part  to  a  third  person  by  an  indorsement 
to  that  effect  upon  the  policy.* 

So  a  resident  general  agent  for  a  foreign  insurance  com- 
pany, whether  appointed  under  a  statute  requiring  a  general 
agent  upon  whom  service  of  process  may  be  made  or  not, 
having  the  general  charge  of  the  business  in  the  State  where 
he  resides,  has  power  to  waive  the  conditions  of  the  policy 
as  to  preliminary  proof  of  loss.^  And,  in  the  absence  of 
evidence  of  limitation  of  his  powers,  any  acts  within  the 
general  scope  of  the  business  will  bind  the  company.^  (a) 

1  People's  Ids.  Co.  v.  Spencer,  53  Pa.  St.  353.     And  see  carte,  §  148. 

2  Kennebec  Co.  v.  Augusta  Ins.  &  Banking  Co.,  6  Gray  (Mass.),  204. 
8  Warner  v.  Peoria  Mar.  &  Fire  Ins.  Co.,  14  Wis.  318. 

*  Newman  v.  Springfield  Fire  &  Mar.  Ins.  Co.,  17  Minn.  123. 

5  Eastern  Railroad  Co.  v.  Relief  Ins.  Co.,  105  Mass.  570. 

6  Imperial  Fire  Ins.  Co.  v.  Murray,  73  Pa.  St.  13. 

(a)  The  restrictions  inserted  in  a  unless  done  in  a  particular  manner,  do 
policy  upon  the  power  of  a  general  or  not  apply  to  those  conditions  which 
other  agent   to  waive   any   conditions,     relate  to  the  inception  of  the  contract^ 

297 


§  151]         insurance:  fiee,  life,  accident,  etc.        [ch.  vil 
He  may  also  waive  a  condition  making  the  validity  of  the 


when  the  agent  delivers  it  and  receives 
the  premiuiiis  with  lull  knowledge 
of  the  actual  situation.  Forward  v. 
Continental  Ins.  Co.,  142  N.  J.  382  ; 
"Wood  V.  American  F.  Ins.  Co.,  149 
N.  Y.  382,  385.  When  general  agents 
have  authority  to  make  contracts  with- 
out reference  to  the  home  office,  or  have 
blank  policies  signed  by  the  president 
and  secretary  of  the  company,  their 
power  to  waive  conditions  in  the  policy 
is  co-extensive  with  that  of  the  com- 
pany itself,  and  with  the  requirements 
of  the  business  at  the  given  time  and 
place.  Berry  v.  American  Central  Ins. 
Co.,  132  N.  Y.  49  ;  Parker  v.  Citizens' 
Ins.  Co.,  129  Penn.  St.  583  ;  Howard 
Ins.  Co.  V.  Owen,  94  Ky.  197  ;  Coles 
V.  Jefferson  Ins.  Co.,  41  W.  Va.  261 ; 
Washington  L.  Ins.  Co.  v.  Menefee 
(Ky.),  29  Ins.  L.  J.  118;  Hahu  v. 
Guardian  Ass.  Co.,  23  Oi'egon,  576  ; 
South  Bend  Toy  Manuf.  Co.  v.  Dakota 
F.  &  M.  Ins.  Co.,  3  So.  Dak.  205.  Re- 
vocation of  such  agents'  authority  with- 
out notice  does  not  take  away  their 
power  to  contract  with  those  who  have 
no  knowledge  of  the  revocation.  Mar- 
shall V.  Reading  F.  Ins.  Co.,  78  Hun, 
83.  See  Greenwich  Ins.  Co.  v.  Sabot- 
nick,  91  Ga.  717.  This  applies,  e.  g. 
to  an  agent's  permit  for  removal  of 
goods.  Burlington  Ins.  Co.  v.  Threl- 
keld,  60  Ark.  539.  One  whom  the 
insured  authorizes  lo  act  as  a  solicit- 
ing agent  only,  without  power  to  issue 
policies  or  waive  their  provisions,  is 
not  a  general  agent.  Martin  v.  Farmers' 
Ins.  Co.,  84  Iowa,  516;  Godfrey  v. 
New  York  L.  Ins.  Co.,  70  Minn.  224  ; 
Farnum  v.  Phoenix  Ins.  Co.,  83  Cal. 
246  ;  17  Arn.  St.  Rep.  233,  248,  note. 

General  agents  may  delegate  to  their 
clerks  and  sub-agents  the  powers  to  act 
for  them  which  are  within  the  scope  of 
their  own  authority.  Goode  v.  Georgia 
Home  Ins.  Co.,  92  Va.  392;  Bergeron 
V.  Pamlico  Ins.  Co.,  Ill  N.C.  45  ;  Boren 
V.  Manhattan  L.  Ins.  Co.,  99  Ga.  238  ; 
McGonigle  v.  Susquehanna  Mut.  F.  Ins. 

298 


Co.,  168  Penn.  St.  1  ;  Harding  v.  Nor- 
wich Union  F.  Ins.  Society,  10  So.  Dak. 
64.  See  Graham  v.  Fire  Ins.  Co.,  48  S.  C. 
195.  General  agents  with  authority  to 
adjust  a  loss  may  waive  conditions  of  the 
policy.  Georgia  Home  Ins.  Co.  v.  Allen 
(Ala.),  28  Ins.  L.  J.  199;  Phenix  Ins. 
Co.  V.  Hunger,  49  Kansas,  178  ;  Ger- 
man Ins.  Co.  V.  Gray,  43  id.  497.  In  a 
late  Massachusetts  case,  it  was  held  that 
a  person  who  for  many  years  has  been 
held  out  by  an  insurance  comi)any  as  a 
general  ageiat  to  negotiate  contracts  of 
insurance  and  agree  upon  all  the  terms 
of  the  contract,  and  for  that  purpose  is 
furnished  with  policies  executed  in  blank 
by  the  president  and  secretary  of  the 
company,  with  authority  to  fill  up  and 
deliver  the  same  to  any  person  with 
whom  he  has  made  a  contract,  is  au- 
thorized to  make  a  preliminary  contract 
to  insure,  binding  upon  the  company, 
to  be  consummated  by  filling  up  and 
delivering  a  policy  pursuant  thereto  ; 
that  conversations  with  the  alleged 
agent  of  an  insurance  company  at  the 
time  when  a  contract  to  insure  prop- 
erty was  made  are  admissible,  in  an 
action  for  breach  of  the  contract,  to 
show  what  the  contract  was,  and  it 
is  within  the  discretion  of  the  judge  to 
admit  them  before  proof  of  the  agency  ; 
and  a  conversation  after  the  loss,  in 
which  the  plaintiff  informed  the  agent 
of  the  loss  and  asked  him  for  the  policy, 
and  the  agent  replied  that  he  did  not 
have  the  policy  or  any  record  of  it,  is 
also  admissible  ;  that  the  fact  that  a 
person  acting  as  agent  of  an  insur- 
ance company  did  not  submit  the  risks 
taken  by  him  to  the  company  for  its 
approval  before  he  wrote  and  delivered 
the  policies  is  admissible,  in  an  action 
against  the  company  for  breach  of  a 
contract  made  by  him  to  insure  prop- 
erty, as  bearing  upon  the  nature  of  his 
authority  ;  and  that  private  instruc- 
tions given  by  an  insurance  company 
to  its  agent,  and  not  communicated  or 
known  to  a  person  with  whom  he  makes 


CH.  VII.]  AGENTS.  —  THEIR   POWERS   AND   DUTIES.  [§  152 

policy  dependent  on  the  prepayment  of  the  premium.^  So 
he  may  waive  a  breach  of  the  condition  of  the  policy  requir- 
ing notice  of  other  insurance,  by  delivering  a  renewal  re- 
ceipt, signed  by  the  president  and  secretary,  and  accepting 
the  premium  after  knowledge  of  the  breach,  though  the  re- 
ceipt by  its  terms  is  not  to  be  effectual  unless  countersigned 
by  the  agent  ;2  and  he  may  give  credit  for  the  renewal  pre- 
mium, or  take  a  note  therefor,  and  bind  the  company  by 
parol,  though  he  hold  such  receipt,^  and  waive  a  require- 
ment that  the  policy  to  be  valid  must  be  countersigned  by 
him,*  or  a  condition  that  suit  shall  be  brought  within  a  cer- 
tain time  after  loss,^  or  that  repairs  shall  not  be  made,  or 
the  house  left  vacant,  without  consent  of  the  insurers  in- 
dorsed on  the  policy.*' 

S  152.  Notice  to  Agent  -when  Notice  to  Principal.  —  If, 
when  notice  to  the  company  is  required  of  any  particular 
fact,  the  notice  be  given  to  the  board  of  directors,  or  to  any 
officer  or  agent  of  the  company  whose  duty  it  was  (under  the 
by-laws,  resolutions,  and  usages  of  the  company,  or  of  the 
business),  upon  receiving  such  notice,  to  communicate  it  to 
the  company,  or  to  any  persons  from  whose  relation  to  the 
company  third  persons  might  fairly  infer  such  duty,  this 
will  be  a  sufficient  compliance  with  the  requirement.''  No- 
tice to  an  agent  appointed  to  receive  and  f?)rward  applications 

1  Boehen  v.  Williamsburgh  City  Ins.  Co.,  35  N.  Y.  131. 

2  Carroll  v.  Charter  Oaklus.  Co.,  40  Barb.  (N.  Y.)  292. 

3  Post  V.  /Etna  Ins.  Co.,  43  Barb.  351 ;  Franklin  Fire  Ins.  Co.  i'.  Massey,  33 
Pa.  221. 

4  Myers  v.  Keystone  Mut.  Life  Ins.  Co.,  27  Pa.  St.  268. 

5  Brady  v.  Western  Ass.  Co.,  17  U.  C.  (C.  P.)  597. 

6  Hotchkiss  V.  Germania  Fire  Ins.  Co.,  5  Hun  (N.  Y.),  90;  Palmer  v.  St. 
Paul  Fire  &  Mar.  Ins.  Co.,  44  Wis.  201  ;  Georgia  Home  Ins.  Co.  v.  Kinnier,  28 
Grat.  (Va.)  88  ;  Young  v.  Hartford  Fire  Ins.  Co.,  45  Iowa,  377. 

•?  Union  Mut.  Ins.  Co.  v.  Wilkinson,  13  Wall.  (U.  S.)  222  ;  ante.  §  144;  Peck 
V.  New  London  Co.  Mut.  Ins.  Co.,  22  Conn.  575. 

a  contract  to  insure  property,  are  prop-  foreign  company  gives  to  the  agent  ap- 

erly  excluded  in  an  action  against  the  parent  authority  to  bind  it,  according 

company   for   breach   of   the   contract,  to   the   established  and  uniform  usage 

Sanford  v.  Orient  Ins.  Co.,  174   Mass.  among  such  agents,  without  regard  to 

416.  its  private  instructions.    Greenwich  Ins. 

The  establishment  of  an  agency  by  a  Co.  v.  Waterman,  54  Fed.  Rep.  839. 

299 


§  153]  INSURANCE  :    FIRE,    LIFE,   ACCIDENT,   ETC.  [CH.  VII. 

and  premiums  is  sufficient;  and  it  need  be  verbal  only,  un- 
less required  by  the  terms  of  the  policy  to  be  in  writing.  ^ 
And  notice  to  an  agent,  at  the  time  of  effecting  the  insur- 
ance, of  subsequent  insurance,  is  notice  to  the  company 
under  a  provision  of  the  contract  that  notice  of  subsequent 
insurance  shall  be  given  to  the  company.  ^  But  mere  knowl- 
edge of  the  fact  of  such  insurance  on  the  part  of  the  agent 
is  not  equivalent  to  notice  to  the  company  ;2  nor  is  such 
knowledge  a  waiver  of  the  notice.*  And  it  is  not  notice, 
within  the  meaning  of  a  proviso  that  notice  shall  be  given 
to  the  agent  or  secretary  of  alterations  increasing  the  risk.^ 
Knowledge  of  prior  insurance  in  the  same  office  is  notice  of 
other  insurance.^  But  a  personal  examination  by  the  presi- 
dent and  one  of  the  directors  of  a  company  after  a  fire,  is 
equivalent  to  notice  of  the  loss  to  the  company,  such  officers 
having  thus  acquired  all  the  knowledge  that  would  be  de- 
sired from  the  required  notice.'^ 

§  153,  In  Pennsylvania,  however,  the  knowledge  and  con- 
sent of  the  agent  to  subsequent  insurance  has  been  held  not 
to  be  that  of  the  company.  Thus  where  it  was  stipulated  in 
the  policy  that  insurance  should  not  be  obtained  upon  the 
property  to  an  amount  beyond  two-thirds  of  its  value,  the 
obtaining  insurance  beyond  that  amount  was  held  to  work  a 
forfeiture,  unless  Mie  company,  after  notice,  waived  the  for- 
feiture ;  and  it  was  also  held  not  to  be  within  the  authority 
of  an  agent  empowered  only  to  make  surveys,  receive  appli- 
cations, examine  into  the  circumstances  of  loss,  approve 
assignments,  and  receive  assessments,  to  accept  notice,  and 

1  McEwen  v.  Montgomer}-  Co.  Miit.  Ins.  Co.,  5  Hill  (N.  Y.),  101  ;  Sexton  v. 
Montgomery  Co.  Miit.  Ins.  Co.,  9  Barb.  (N.  Y.)  191  ;  Schenck  v.  Mercer  Co. 
Mut.'ins.  Co.,  4  Zabr.  (N.  J.)  447. 

2  New  England  Fire  &  Mar.  Ins.  Co.  v.  Schettler,  38  111.  166. 

3  Schenck  v.  Mercer  Co.  Mut.  Ins.  Co.,  4  Zabr.  (N,  J.)  447  ;  Mellen  v.  Hamil- 
ton Fire  Ins.  Co.,  5  Duer  (N.  Y.),  101  ;  s.  c.  affirmed,  17  N.  Y.  609  ;  Ayres  v. 
Hartford  Fire  Ins.  Co.,  17  Iowa,  176. 

*  Forbes  v.  Agawam  Mat.  Ins.  Co.,  9  Cush.  (Mass.)  470. 

o  Sykes  v.  Perry  Co.  Mut.  Ins.  Co.,  34  Pa.  St.  79  ;  Robinson  v.  Mercer  Co. 
Mut.  Fire  Ins.  Co.,  3  Dutch.  (N.  J.)  134. 

6  Rowley  v.  Empire  Ins.  Co.,  36  N.  Y.  550. 

'  Roumage  v.  Mechanics'  Fire  Ins.  Co.,  1  Green  (N.  J.),  110.  And  see  also 
a7itc,  §  143. 

300 


CH.  VII.]         AGENTS. —  THEIR   POWERS   AND   DUTIES.  [§  154 

by  his  consent,  after  the  issue  of  the  policy,  to  waive  the 
forfeiture;  and  his  approval  therefore  could  be  of  no  avail 
to  the  insured.  It  is  on  the  principle  of  estoppel,  and  not 
of  authority,  the  waiver  takes  place.  The  knowledge  of  a 
mere  agent,  unauthorized  to  represent  the  company  beyond 
the  specific  powers  committed  to  him,  cannot  be  the  ground 
of  estoppel  in  a  matter  unconnected  with  the  exercise  of  his 
powers.  This  can  only  take  place  when  the  knowledge  lying 
at  the  foundation  of  the  estoppel  comes  home  to  those  offi- 
cers who  exercise  the  corporate  powers  of  the  company,  or 
to  an  agent  whose  powers  relate  to  the  very  subject  out  of 
which  the  estoppel  arises.  ^  Otherwise  if  notice  is  given 
before  the  policy  issues.  ^  So  in  Massachusetts,  notice  to  an 
agent  of  alienation  or  assignment  is  not  notice  to  the  com- 
pany, nor  has  the  agent  power  to  waive  such  notice,  if  re- 
quired by  the  policy,  nor  to  bind  the  company  by  his  opinion 
that  notice  is  not  necessary.-^ 

§  154.  Sub-agents  and  Clerks.  — Where  insurers  issue  their 
policies  in  blank,  to  be  valid  only  when  countersigned  by 
their  duly  authorized  agents,  and  appoint  a  firm  of  several 
persons  to  act  as  their  general  agents  for  a  particular  State, 
and  refer  to  them  as  having  charge  of  the  appointment  of 
agents  within  that  State,  a  sub-agent  appointed  by  one  of 
the  members  of  tnt  firm,  having  a  branch  office  at  a  place 
other  than  the  chief  place  of  business  of  the  firm,  will 
thereby  acquire  the  power  to  countersign  the  policies.  And 
a  policy  so  countersigned  will  bind  the  company,  notwith- 
standing that  prior  to  the  issue  of  the  policy  the  firm  holds 
a  power  of  attorney  from  the  insurance  company  empower- 
ing them  to  "  receive  moneys  and  to  countersign  and  issue 
policies, ''  and  a  like  power  of  attorney  was  forwarded  to  the 
members  of  the  firm  who  appointed  the  sub-agent,  some 
months  after  the  appointment.  These  powers  of  attorney 
do  not  concern  the  public,  to  whom  they  are  unknown. 
They  are  rather  in  the  nature  of  private  instructions,  bind- 

1  Jlitchell  V.  Lycoming  Mut.  Ins.  Co.,  51  Pa.  St.  402. 

2  People's  Ins.  Co.  v.  Spencer,  53  Pa.  St.  353. 

8  Tate  V.  Citizens'  Mut.  Fire  Ins.  Co.,  13  Gray  (Mass.),  79. 

301 


§  154  A]      INSURANCE  :    FIRE,   LIFE,    ACCIDENT,   ETC.  [CH.  VII. 

ing  between  the  principal  and  agent,  but  without  effect  as 
against  the  public,  who  have  treated  with  the  agents  on  the 
assumption  that  they  actually  had  the  power  which  they 
exercised  and  were  known  by  their  principals  to  have  exer- 
cised.^ Under  a  like  stipulation  it  has  been  held  in  Ken- 
tucky that  the  signature  by  a  third  person  "for  the  agent," 
is  not  a  compliance  with  the  stipulation,  and  such  a  policy 
is  void.  2  The  clerk  of  an  agent  whose  acts  have  been  recog- 
nized by  the  company  and  accepted,  may  bind  the  company 
by  his  consent  to  a  part  payment  of  the  premium. ^  [But 
when  a  sub-agent  signs  a  policy  for  the  agent,  who  later 
with  full  knowledge  of  all  the  facts  delivers  the  policy,  the 
signature  hecoiues  his,  and  hence  the  company's.*]  Gener- 
ally agents  of  insurance  companies  authorized  to  contract 
for  risks,  receive  and  collect  premiums,  and  deliver  policies, 
may  confer  upon  a  clerk,  or  subordinate,  authority  to  exercise 
the  same  powers.  The  service  is  not  of  such  a  personal  charac- 
ter as  to  come  under  the  maxim,  delegatus  non  i^otest  delegare.^ 
[§  154  A.  An  agent  who  has  full  power  in  a  large  terri- 
tory to  receive  proposals,  fix  premiums,  renew,  &c.,  may 
appoint  sub-agents  to  solicit  and  receive  applications  for 
premiums,  forward  applications,  (fec.^  It  is  not  to  be  ex- 
pected that  a  general  agent  should  personally  attend  to  all 
the  affairs  under  his  control.  He  may  employ  all  necessary 
clerks,  sub-agents,  and  surveyors  to  enable  him  to  transact 
the  business  with  accuracy,  intelligence,  and  promptness, 
and  may  authorize  his  clerks  to  contract  for  risks  so  that 
they  may  bind  the  company  by  a  parol  contract.'^     The  com- 

^  Bowman  t'.  U.  S.  Casualty  Ins.  Co.,  N.  Y.  Ct.  of  Appeals,  affirming  s.  c.  in 
N.  Y.  Supr.  Ct.  1869,  cited  in  Bliss,  Life  &  Ace.  Ins.  488  ;  Kennebec  Co.  u.  Au- 
gusta  Ins.  Co.,  6  Gray  (Mass.),  204. 

2  Lynn  v.  Burgoyne,  13  B.  Mon.  (Ky.)  400. 

8  Bodine  v.  Exchancre  Fire  Ins.  Co.,  51  N.  Y.  117. 

4  [Grady  v.  Amer.  Cent.  Ins.  C '.,  60  Mo.  116,  123.] 

6  Bodine  v.  Exchange  Fire  Ins.  Co.,  51  N.  Y.  117  ;  Eclectic  Life  Ins.  Co.  i;. 
Fahrenkrug,  68  111.  463  ;  ante,  §  127 ;  Continental  Life  Ins.  Co.  v.  Goodall,  Cin- 
cinnati Supr.  Ct.  1874,  5  Big.  Life  &  Ace.  Ins.  Cas.  422  ;  Mayer  1J.  Mut.  Life  Ins. 
Co.,  38  Iowa,  304  ;  Planters'  Ins.  Co.  v.  Myers,  55  Miss.  479  ;  Cooke  v.  iEtna 
Ins.  Co.,  7  Daly  (N.  Y.),  555. 

6  [Krumm  v.  Insurance  Co.,  40  Ohio  St.  225.] 

'  [Kuney  v.  Amazon  Ins.  Co.,  36  Hun,  66.] 

302 


CH.  VII.]         AGENTS.  —  THEIR   POWERS   AND   DUTIES.  [§  155 

pany  is  bound  by  the  contract  of  employment  of  a  soliciting 
agent  by  its  general  agent,  unless  the  person  employed  had 
notice  of  restrictions  on  the  authority  of  the  general  agent. ^ 
Foreign  companies  are  responsible  for  the  acts  of  all  persons 
who  aid  in  transacting  its  business  with  its  authority,  or 
without,  if  the  company  in  any  way  avails  itself  of  their 
acts. 2  If  a  sub-agent  who  has  been  correctly  informed 
makes  a  mistake  in  filling  in  the  wrong  name  of  the  appli- 
cant's doctor,  the  company  is  estopped.^  A  mere  stranger 
from  whom  the  regular  agents  receive  the  premium,  and  to 
whom  they  deliver  a  policy  which  he  countersigns  and  de- 
livers to  the  assured,  will  bind  the  company.  He  is  a  sort 
of  sub-agent*  It  is  a  question  of  fact  for  the  jury  whether 
an  agent  employed  to  effect  insurance,  without  special  in- 
structions, is  liable  for  brokers  through  whom  it  is  effected, 
and  also  as  to  the  extent  of  his  responsibility.^] 

§  155.  Agents  of  Accident  Insurance  Companies.  — Certain 
kinds  of  accident  insurance  —  as  of  railway  passengers  —  are 
effected  by  means  of  the  purchase  and  sale  of  tickets  issued 
by  the  companies  to  their  agents,  and  sold  by  them  or  those 
in  their  employ  like  merchandise,  the  sale  and  delivery  of 
the  ticket  by  the  agent  or  his  employ^  on  the  one  hand,  and 
the  payment  of  the  premium  by  the  purchaser  on  the  other, 
consummating  the  contract.  And  the  contract  holds  good 
whether  the  purchaser  obtains  his  ticket  from  the  company 
directly,  or  indirectly  from  any  person  having  authority 
mediately  from  the  company.^ 

1  [Equitable  Life  Ass.  Co.  v.  Brobst,  18  Neb.  526,  523.] 

2  [Continental  Ins.  Co.  v.  Paickman,  127  111.  364.] 

3  [Langdon  v.  Union  Mut.  Life  Ins.  Co.,  14  Fed.  Rep.  272;  22  Am.  L.  Reg. 
N.  s.  385  (Mich.),  1882.] 

*  [Camden  C.  Oil  Co.  v.  Ohio  Ins.  Co.,  5  Cin.  L.  Bui.  193,  6th  Cir.  (Ohio) 
1880.] 

5  [Hurrell  v.  Bullard,  3  F.  &  F.  445.] 

6  Brown  v.  Railway  Passenger  Ass.  Co.,  45  Mo.  22L 


303 


insurance:  fire,  life,  accident,  etc.     [ch.  yiii. 


Analysis. 


CHAPTER  VIII. 

WARRANTIES.!  —  APPLICATION.  —  CONSTRUCTION. 
1.    Definitions, 


§  156.  A  warranty  is  an  express  stipulation  on  the  face  of  the  policy,  on 

the  literal  (?)  truth  or  fulfilment  of  which  the  validity  of  the 
contract  depends.  It  has  the  force  of  a  condition  precedent  and 
must  be  strictly  and  literally  (?)  complied  with,  whether  mate- 
rial to  the  risk  or  not  (see  §  170  and  §  180,  a,  n.)  whether  the 
insured  believed  it  true  or  not,  or  the  agent  or  even  the  company 
knew  it  was  false  at  the  time  of  insurance  (?)  (§§  156,  145).  If 
it  fail  in  any  otlier  way  than  by  act  of  the  insurer,  of  the  law,  or 
of  God,  the  insured  cannot  recover.  The  law  ought  to  exclude 
honest  errors  undoubtedly  immaterial,  and  substantial  compliance 
should  be  enough.  Forfeitures  because  of  honest  immaterial 
error,  or  failure  of  literal  fulfilment  of  a  warranty,  especially  if 
it  requires  more  than  the  will  of  the  assured  to  fuliil  it,  is  not 
justice,  and  if  the  parties  so  agree  it  is  not  a  just  agreement 
(§§  156,  157,  161,  185).  Moreover  if  the  company  itself  knows 
the  truth  at  the  time  of  contracting  it  cannot  be  damaged  by  an 
error  on  the  part  of  the  assured,  and  should  not  set  up  the  war- 
ranty. (See  §§  144  A,  144  G,  197,  207,  260-262.)  So  in  some 
cases  the  agent's  knowledge  ought  to  estop  the  company  (see  ch. 
vii.  anal.  5). 

§  157.  Affirmative  and  promissory  warranties.     A  warranty  of  present  use 

not  a  promise  as  to  the  future  use,  but  ought  to  be  so  held  where 
the  natural  and  well  understood  pur;>ose  of  the  question  is  to 
determine  the  nature  of  the  risk  to  be  borne,  and  the  matter  is 
too  important  for  alteration  in  good  faith  (see  §§  191,  231,  247, 
248,  and  ch.  xi.  anal.  §  250).  Smoking,  Force-pump,  Sperm- 
oil. 

1  Though  we  have  treated  the  several  subjects  of  warranty,  representation, 
and  concealment  in  separate  chapters,  it  will  be  seen  that  these  subjects  are  so 
nearly  allied,  that  cases  illustrative  of  each  have  much  in  common  ;  and  if  it 
were  material  it  would  be  difficult  to  determine  imder  which  chapter  to  arrange 
them.  For  the  most  part,  a  case  in  either  chapter  will  illustrate  the  others,  as 
the  several  subjects  are  almost  invariably  discussed  together.  And  each  subject 
will  be  further  illustrated  by  cases  cited  when  we  come  to  treat  of  the  several 
conditions,  stipulations,  and  provisions  of  the  contract. 

304 


CH.  VIII.]    WARRANTIES.  —  APPLICATION.  —  CONSTRUCTION, 

2.    What  is  Part  of  the  Policy. 

In  Massachusetts  by  statute  neither  by-laws  nor  application  are 
part  of  the  policy  so  as  to  become  warranties,  except  so  far  as 
incorporated  into  the  policy  in  full.     Pub.  Stats.,  §  712. 
§  158.  Face  of  policy  includes  statements  written  in  the  margin  or  across 

the  policy,  or  in  other  papers  referred  to  and  made  a  part 
of  the  policy,  but  not  endorsements  on  the  back,  or  i)apers 
merely  folded  up  in  policy  or  stuck  on  with  mucilage,  unless 
such  papers  or  endorsements  are  referred  to  in  the  policy  ; 
and  even  reference  alone  is  not  sufficient  unless  the  language 
indicates  ayi  intent  to  make  the  paper  part  of  the  contract 
(§  159).  A  doubt  will  be  resolved  against  the  company, 
(§§  160-165,  170,  171). 
Warranties  not  favored,  §  158. 

courts  lean  to  make  statements  representations,  §  162  (and 

they  ought  to  lean  a  little  harder  than  some  of  them  do). 

general  rule,  a  reference  to  application  in  policy  makes  its 

statements  warranties,  §  159. 
but  reference  in  mere  general  terms  is  not  enough,  §  159. 
it  must  be  stipulated  that  the  statements  are  warranties 

or  conditions,  §  159. 
the  words  "  on  condition  "  may  not  be  enough,  §  162. 
if  there   is  room    for   doubt,   they   are   representations, 

§§  159,  162,  160-165,  170,  171. 
so  if  any  other  purpose  of  the  reference  appears,  §  159. 

or  if  the  purpose  does  not  appear,  §  164. 
a  statement  though  written  on  the  policy  itself  may  not 

be  a  warranty,  §  164. 
what  the  parties  call  representations  cannot  be  made  war- 
ranties by  being  made  part  of  the  policy,  §  165. 
question  not  answered  is  a  nonentity,  §  166. 

if  company  issues  policy,  on  the  omission  the  question 
is  waived,  §  166. 
part  answer,  warranty  can  go  no  further  than  the  answer, 
§166. 
§  159.  The  application,  survey,  or  other  statements  oral  or  written,  if  not 

referred  to  in  the  policy,  are  merely  representations.     (See  also 
§  160.)      If  written  or  oral   statements  are  referred  to  in  the 
policy  they  may  be  proved  by  parol  (§  159). 
§§  160,  161.      Qualified  statement  or  reference,  knowledge,  assertion  of  belief,  not 
of  absolute  truth.    The  several  stipulations  in  the  policy, 
application,  &c.,  must  be  carefully  compared,  for  something 
may  appear  inconsistent  with  holding  statements  to  be  war- 
ranties, §§  161,  168,  169. 
or  showing  that  they  are  warranties  only  as  to  some  particulars 

and  representations  as  to  others,  §  160. 
"  so  far  as  known,"  §§  161,  166. 

"In  all  respects  true,"  followed  by  "  to  best  of  my  knowl- 
edge," no  warranty,  §  161. 
other  qualifying  clauses,  §§  160,  161. 

It  is  a  question  for  the  jury  whether  the  assured  did  answer 
according  to  his  best  knowledge,  §  161. 

VOL.  1.  — 20  305 


INSURANCE  :   FIRE,   LIFE,    ACCIDENT,    ETC.         [CH.  VIIL 

3.    Construction  against  Warranties. 
§§  162-165.     Constructive  wari'anties  not  favored.     If  the  statement  or  reference 
appear  to  be  made  for  another  purpose  than  warranty,  or  the 
purpose  be  doubtful,  it  will  not  be  construed  as  a  warranty, 
§§  162-165. 
where  a  statement  in  all  fairness  and  good  faith  must  have  the 
effect  of  a  warranty  it  will  be  so  construed  though  not  so  in 
form  ;  see  §§  250-252,  157,  191,  247,  248,  231. 
immaterial,  unguarded,  and  superfluous  statements  ought  not 

to  be  converted  into  warranties  by  the  courts,  §  170. 
courts  lean  away  from  warranties,  §  162. 
the  clearest  language  necessary  to  create  one,  §  162. 
stipulation  to  keep  openings  closed  not  a  warranty  because  not 
expressed  to  be  on  penalty  of  forfeiture,  §  164. 
§  165  A.  In  the  case  of  marine  insurance  there  is  an  implied  warranty  of  sea- 

worthiness. 
§  166.  Ambiguous  and  superfluous  answers.     Unanswered  questions  are 

waived  if  a  policy  is  issued  on  the  application. 
§  167.  No  application  necessar3\ 

§§  168,  169.      The  application  may  limit  and  modify  the  policy. 
"  If  any  of  the  statements,  &c.,  be  untrue." 
is  modified  by  a  clause  in  the  application. 
"  fraud tdent   concealment  or   designedly  untrue."      See   also 
§161. 
§  170.  Matter  immaterial  to  the  risk  or  statements  not  required  by  the 

conditions  of  the  contract  may  be  expressly  warranted,  but 
no  implied  warranty  will  be  raised  in  such  a  case. 
Warranties  will  be  construed  strictly  against  those  for  whose 
benefit  they  are  made,  and  so  as  to  save  a  forfeiture  if  pos- 
sible. 
Dividends  earned  by  company  applied  to  save  premium  note. 
§  171.  Warranties  strictly  construed  as  to  their  scope. 

4.     Construction  in  General. 
§  172.  Interpretation  of  insurance  contracts  governed  by  the  principles  that 

apply  to  other  contracts.     (See  also  §  173.)     Insurance  law  all 
grew  out  of  marine  insurance,  which  has  therefore  to  be  con- 
tinually referred  to  for  the  elucidation  of  other  kinds. 
§  172  A.  Construction  : 

should  be  loithoid  favor  to  either  party. 

courts  too  often  act  as  though  insurance  companies  were 
conclusively  presumed  to  be  naughty  boys  fit  only  for 
the  shingle, 
intent  of  parties  must  be  sought. 

surrounding   circumstances   to    show    what    goods   were 
meant, 
conversations  at  time  competent, 
and  contemporaneous  insurance  literature, 
printed  conditions  not  apjilicable  to  ])articular  case  ignored, 
what  the  promisor  knew  the  promisee  understood  governs, 
proper  to  show  that  a  name  of  a  locality  applies  by  common 
repute,  though  geographically  incorrect. 

306 


CH.  YIII.]    WAKRANTIES.  —  APPLICATION.  —  CONSTRUCTION. 

course  of  dealing  admissible. 

parts  of  a  day  not  reckoned.     Warranty  of  safety  on  December 
9  is  satisfied  if  safe  on  any  part  of  the  day,  though  lost  be- 
fore policy  is  signed. 
if  facts  clear,  construction  is  for  court. 

false  warranty  as  to  part  of  severable  policy  not  avoid  whole. 
§§  173-179,     Usage  : 

If  the  usage  offered  in  evidence  is  not  contrary  to  a  settled 

principle  of  law  and  justice,  §  179  B  ; 
and  was  known  to  the  person   against  whom   it  is  invoked, 
actually  or  constructively  by  reason  of  its  general  and  estab- 
lished character,  or  because  of  his  entering  by  his  dealings 
the  sphere  controlled  by  it,  as  in  using  the  facilities  of  a 
bank,  §§  179  C,  179  E  ; 
and  is  not  excluded  by  the  terms  of  the  contract,  §  179  D  ; 
and  does  not  import  a  new  and  distinct  condition   into   the 

agreement,  §  180  ; 
it  is  admissible  to  explain  the  meaning  of  the  parties,  and  the 
manner  in  which  the  contract  is  to  be  carried  out,  §§  173, 
179,  179  A. 
§§  174, 175.     The  object  is  indemnit}',  and  the  construction  will  be  liberal  to  ac- 
complish it.      (See  also  §  175.) 
all  clauses  will  be  reconciled  and  given  their  effect  if  possible. 

Unreasonable  conclusions  will  be  avoided, 
contract  sustained  if  possible,  §  175. 

company  not  escape  on  mere  technicalities,   §  175.     (Neither 
ought  it  to  be  held  on  them.) 
§§  175,  176.     When  other  rules  of  interpretation  fail  to  resolve  a  doubt  the  lan- 
guage is  to  be  taken  most  strongly  against  the  person  using  it. 
Courts  will  not  declare  a  forfeiture  unless  distinctly  so  pro- 
vided. 
§  177.  Written  words  prevail  over  printed  ones  ;  if  they  are  not  incon- 

sistent both  sustained.     See  §  239. 
§  178.  Insurers  held  to  the  exact  words  of  a  warranty.     A  false  representa- 

tion about  a  building  not  insured  immaterial.  Incidental  keep- 
ing of  a  barrel  of  oil  not  a  violation  of  a  general  provision  against 
storing  oil.  Alteration  in  machinery  not  a  forfeiture.  Running 
fires  and  engine  at  night  not  a  running  of  the  mill.  A  cold  is 
not  "  sickness."  Bringing  shavings  into  shop  no  breach  of  war- 
ranty that  business  is  making  bathtubs. 
§  180  a.  Statute  interference  has  been  necessary  to  prevent  the  companies 

from  defrauding  the  insured  by  insisting  on  immaterial  and  un- 
reasonable conditions,  in  policies  almost  forced  upon  tlie  people, 
so  voluminous  and  printed  so  fine  as  to  discourage  reading  and 
comprehension,  fixed  up  by  the  companies'  agents,  with  no  sus- 
picion on  the  part  of  the  insured  as  to  the  trap  into  which  he  is 
being  decoyed,  — policies  gotten  up  expressly  to  prevent  lia- 
bility, and  even  going  so  far  as  to  assert  that  the  agent  was  the 
agent  of  the  insured  not  of  the  company.  (See  the  fine  state* 
ment  of  Ch.  J.  Doe,  §  180  a,  n.) 

307 


§  156J  INSURANCE  :   FIRE,   LIFE,    ACCIDENT,    ETC.         [CH.  VIII. 

§  156.  Definition  of  Warranty.  —  In  all  contracts  of  insur- 
ance, certain  statements  are  made,  certain  stipulations  are 
entered  into,  and  certain  provisos,  conditions,  and  by-laws 
are  introduced  or  referred  to,  in  a  more  or  less  explicit  man- 
ner. As  a  general  rule,  if  these  statements,  stipulations, 
&c.,  are  contained  in,  or  expressly  made  a  part  of  the  pol- 
icy, they  become  wa7'ranties,  and  are  so  denominated  in  the 
law  of  insurance.  We  say  as  a  general  rule,  because  we 
shall  see  as  we  advance  in  this  chapter  that  there  are  im- 
portant exceptions.  "An  express  warranty  is  a  stipulation 
inserted  in  writing  on  the  face  of  the  policy,  on  the  literal 
truth  or  fulfilment  of  which  the  validity  of  the  entire  con- 
tract depends."  This  is  the  definition  given  by  Arnould,^ 
which  has  met  with  general  acceptance.  By  a  w^arranty  the 
insured  stipulates  for  the  absolute  truth  of  the  statement 
made,  and  the  strict  compliance  with  some  promised  line  of 
conduct,  upon  penalty  of  forfeiture  of  his  right  to  recover  in 
case  of  loss  should  the  statement  prove  untrue,  or  the  course 
of  conduct  promised  be  unfulfilled.  A  warranty  is  an  agree- 
ment in  the  nature  of  a  condition  precedent,  and  like  that, 
must  be  strictly  complied  with.^  (a) 

^  1  Ins.  577. 

2  Daniels  et  ul.  v.  Hudson  River  Fire  Ins.  Co.,  12  Cush.  (Mass.)  416  ;  Eiplej'  v. 
.^.tna  Fire  Ins.  Co.,  30  N.  Y.  136;  Campbell  v.  N.  E.  Mut.  Life  Ins.  Co.,  98  Mass.  381. 

(«)  Insurance  companies  cannot,  shall  be  material.  Herman}-  v.  Fidelity 
however,  contract  in  disregard  of  the  M.  L.  Ass'n,  151  Penn.  St.  17,  24  ; 
plain  provisions  of  a  statute  made  for  March  v.  Met'n  L.  Ins.  Co.,  186  id. 
their  guidance.  Thus,  under  statutes  629  ;  Fidelity  M.  L.  Ass'n  v.  Ficklin, 
such  as  those  of  Pennsylvania  of  June  74  Md.  172,  185;  see  Same  v.  Miller, 
23,  1885,  and  of  Maryland  of  1894,  de-  92  Fed.  Kep.  63,  71  ;  Penn.  Mut.  L. 
daring  that  a  misrepresentation  or  un-  Ins.  Co.  v.  Mechanics'  Sav.  B.  &  T. 
true  statement  by  an  applicant  for  life  Co.,  43  U.  S.  App.  75.  The  effect  of 
insurance,  when  made  in  good  faith,  the  Massychusetts  statute  is  that  mis- 
shall  not  work  a  forfeiture,  unless  relat-  representations  of  fact,  whether  called 
ing  to  a  matter  material  to  the  risk,  the  by  the  parties  a  warranty  or  a  represen- 
courts  of  both  these  States  hold  that  tation,  are  equally  misrepresentations, 
the  "misrepresentation"  or  "untrue  and  that  the  insured  can  only  defeat 
statement  "  in  the  application,  when  the  policy  by  showing,  not  only  that 
sought  to  be  made  a  ground  of  defence,  the  statements  or  answers  were  incorrect, 
must  be  of  some  material  matter,  and  but  also  either  that  the  misrepresenta- 
that  the  parties  are  not  free  to  contract,  tions  were  made  with  actual  intent  to 
—  in  the  face  of  the  statute,  which  can-  deceive,  or  that  the  matter  misrepre- 
not  be  waived,  —  that  immaterial  matter  seuted  increased  the  risk  of  loss.   A\'hite 

308     ■ 


CH,  YIII.]    WARKANTIES. — APPLICATION. — CONSTEUCTIOX.      [§  156 

Whether  the  fact  stated  or  the  act  stipulated  for  be  mate- 
rial to  the  risk  or  not,  is  of  no  consequence,^  the  contract 
being  that  the  matter  is  as  represented,  or  shall  be  as  prom- 
ised ;  and  unless  it  prove  so,  whether  from  fraud,  mistake, 
negligence,  or  other  cause,  not  proceeding  from  the  insurer, 
or  the  intervention  of  the  law  or  the  act  of  God,  the  insured 
can  have  no  claim.^  [When  a  policy  provided  that  it  should 
be  void  if  any  of  the  warranties  were  "false"  or  fraudulent, 
this  was  held  to  mean  untrue  whether  with  or  without  the 


1  [Bennett  v.  Agr.  Ins.  Co.,  50  Conn.  420  ;  Thomas  v.  Fame  Ins.  Co.,  108  111. 
91  ;  Ala.  Gold  L.  Ins.  Co.  v.  Garner,  77  Ala.  210  ;  Sclnvarzbach  v.  Protective 
Union,  25  W.  Va.  622,  652  ;  Dwight  v.  Germania  Life  Ins.,  103  N.  Y.  341.  A 
warrant}'  is  a  part  of  the  contract,  and  whether  material  or  not  must  be  strictly 
complied  with,  while  a  rej)resentation  is  collateral  or  preliminary  to  the  contract, 
and  though  false  does  not  avoid  the  contract  unless  actually  material  or  clearly 
intended  to  be  made  material  by  the  parties.  Ala.  Gold  Life  Ins.  Co.  v.  Johnston, 
80  Ala.  467.] 

2  Cooper  V.  Farmers'  Mut.  Fire  Ins.  Co.,  50  Pa.  St.  299  ;  Newcastle  Fire  Ins. 
Co.  V.  Macmorran,  3  Dow,  P.  C.  255  ;  Sayles  v.  North  Western  Ins.  Co.,  2  Cur- 
tis C.  Ct.  (Mass.)  610,  612  ;  Witherell  v.  Maine  Ins.  Co.,  49  Me.  200  ;  Pawson 
V.  Watson,  Cowp.  785  ;  Anderson  v.  Fitzgerald,  24  Eng.  L.  &  Eq.  1  ;  4  H.  of  L. 
Cas.  484 ;  Duckett  v.  Williams,  2  C.  &  M.  348  ;  post,  §§  350,  352. 


V.  Provident  S.  L.  Ass.  Society,  163 
Mass.  108,  115  ;  Levie  v.  Met'n  Life 
Ins.  Co.,  id.  117  ;  King  Brick  M.  Co. 
V.  Phffinix  Ins.  Co.,  164  Mass.  291  ; 
Wright  V.  Vermont  L.  Ins.  Co.,  id.  302  ; 
Hogan  V.  Met'n  Life  Co.,  id.  448  ; 
Stocker  v.  Boston  Mut.  F.  Ins.  Co., 
170  Mass.  224;  Dolan  v.  Mutual  Re- 
serve Fund  Life  Ass'n,  173  Mass.  197. 

In  Iowa,  by  statute  a  cop3'  of  the 
application  must  be  attached  to  or  in- 
dorsed on  the  policy,  in  order  that  the 
company  may  plead  or  prove  the  apjili- 
cation  in  an  action  on  the  policy.  Cook 
i\  Federal  Life  Ass'n,  74  Iowa,  746  ; 
McConnell  v.  Iowa  Mut.  Aid  Ass'n, 
79  id.  757  ;  Grimes  v.  Northwestern 
Legion  of  Honor,  97  id.  315.  But  this 
does  not  preclude  an  officer  or  incorpo- 
rator, sought  to  be  held  liable  for  the 
loss,  from  using  such  evidence  in  show- 
ing that  the  insured  was  not  misled  to 
his  detriment.  Jloore  v.  Union  Frater- 
nal Ace.  Ass'n,  103  Iowa,  424,  428.    In 


Massachusetts  also,  the  legislature  has 
aimed  to  benefit  policy  holders  by  ob- 
liging insurance  companies  to  attach  to 
each  policy  a  correct  copy  of  the  appli- 
cation, so  that  the  insured  may  know 
what  are  the  precise  terms  of  his  appli- 
cation ;  and  this  is  now  treated  as  the 
law  applicalde  alike  to  iire,  life,  and 
assessment  insurance.  Considine  v. 
Met'n  Life  Ins.  Co.,  165  Mass.  462, 
465. 

A  policy  stipulation  that  the  state- 
ments and  answers  in  the  application 
are  warranties  and  if  untrue,  though 
made  in  good  faith,  the  policy  shall  be 
void  notwithstanding  any  statute  to  the 
contrary,  is  invalid  in  so  far  as  it  con- 
flicts with  a  statute  providing  that  no 
representation  made  in  good  faith  shall 
work  a  forfeiture  or  be  a  ground  of  de- 
fence unless  it  relates  to  some  matter 
material  to  the  risk.  B'idelity  Mut  L. 
Ass'n  V.  Ficklin,  74  Md.  172. 

309 


§  156]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.        [CH.  VIII. 

assured 's  knowledge  of  their  untruth.^  A  breach  of  war- 
ranty is  fatal  though  the  insured  acted  in  perfect  good 
faith.2(a)  The  insured  cannot  claim  that  an  answer  which 
he  has  declared  shall  be  a  warranty  was  made  by  mistake  or 
inadvertence.^  Mere  knowledge  by  the  agent,  or  by  the  com- 
pany, that  a  warranty  is  not  true  at  the  time  it  is  made  does 
not  relieve  the  assured  from  the  consequences  of  a  breach, 
or  convert  the  contract  into  a  different  warranty,  and  is  no 
basis  for  reforming  the  contract.^  Knowledge  of  the  agent 
that  a  warranty  was  false  is  no  waiver  by  the  company.^] 

One  of  the  very  objects  of  the  warranty  is  to  preclude  all 
controversy  about  the  materiality  or  immateriality  of  the 
statement.  The  only  question  is,  has  the  warranty  been 
kept  ?  There  is  no  room  for  construction ;  no  latitude ;  no 
equity.  If  the  warranty  be  a  statement  of  facts,  it  must  be 
literally  true ;  if  a  stipulation  that  a  certain  act  shall  or 
shall  not  be  done,  it  must  be  literally  performed.^    A  learned 

1  [Foot  V.  iEtna  Life  Ins.  Co.,  61  N.  Y.  r>71,  577.] 
-  [Couimonvvealth  Mat.  Fire  Ins.  Co.  v.  Huntzinger,  98  Pa.  St.  41.] 
3  [Ala.  Gold  L.  Ins.  Co.  v.  Garner,  77  Ala.  210.] 

*  [Commonwealth  Mat.  Fire  Ins.  Co.  v.  Huntzinger,  98  Pa.  St.  41,  47  ;  State 
Mut.  Fire  Ins.  Co.  v.  Arthur,  30  Pa.  St.  315,  831.] 

5  [Tebbets  v.  Hamilton  Mut.  Ins.  Co.,  3  Allen,  569  ;  Foot  v.  Mtim  Ins.  Co., 
61  N.  Y.  571,  576  ;  Dewees  v.  Manhattan  In.s.  Co.,  35  N.  J.  L.  366,  371.  But 
see  contra,  and  much  better  doctrine  as  to  cases  in  which  the  company  itself 
knows  the  truth,  §§  144  A.,  133  A.] 

6  Ripley  V.  Mtna.  Fire  Ins.  Co.,  30  N.  Y.  136  ;  Hibbert  v.  Pigon,  Park,  Ins. 
339  ;  s.  c.  Mar.sh.  Ins.  272,  per  Lord  Mansfield  ;  Anderson  v.  Fitzgerald,  4  H.  of 
L.  Cas.  484  ;  s.  c.  24  Eng.  L.  &  Eq.  1.  In  Hutchison  v.  Nat.  Loan  Fire  Ins.  Co., 
7  Ct.  of  Sess.  Cas.  (Scotch)  2d  Series,  467  ;  s.  c.  3  Big.  Life  &  Ace.  Ins.  Ca-s. 
444,  it  was  held  that  this  warranty  did  not  apply  to  facts  unknown  to  the  appli- 
cant without  negligence,  as,  for  instance,  the  fact  of  the  existence  of  a  latent 
and  unknown  disease  of  which  there  had  been  no  s3'mptoms,  which  was  unsus- 
pected, and  only  made  known  by  a  post-mortem  examination.  The  statement 
was  that  the  applicant  enjoyed  good  health,  and  that  no  circumstance  or  infor- 
mation touching  health  with  which  the  insurers  ought  to  be  made  acquainted 
was  withheld.  It  was  sufficient  if  such  a  statement  was  true  according  to  the 
knowledge  and  belief  of  the  applicant.  See  also  post,  §  202.  [When  the  assured 
guaranteed  to  have  the  average  price  of  freight  405.  per  ton  on  his  ship,  but  in 
reality  it  was  only  32s,,  it  was  held  to  avoid  the  policy,  although  by  adding  the 
j)roceeds  from  passengers  the  amount  would  have  made  more  than  40s.  Lewis  v. 
Marshall,  7  M.  &  Gr.  739,  743.] 

(a)  Fraud  is  not  necessary  to  avoid  Under  a  statute  making  immaterial 
a  policy  when   a  warranty   is   broken,     warranties   in    an    application    simply 

310 


CH.  VIII.]    WAKRANTIES. — APPLICATION.— CONSTRUCTION.        [§  156 

judge  and  author  declares  it  to  be  unfortunate  that  so  strict 
a  rule  has  been  established,  and  intimates,  what  is  no  doubt 
entirely  true,  that  courts  are  not  at  all  inclined  to  go  beyond 
the  precedents  to  sn])port  a  warranty.  ^  [There  are  even 
authorities  to  the  effect  that  in  dealing  with  warranties  com- 
mon sense  is  not  to  be  lost  sight  of,  and  that  the  fair  prac- 
tical intent  of  the  parties  is  to  be  sought,  not  the  hair 
splitting  of  a  college  of  wit  crackers,  and  that  substantial 
fulfilment  of  a  warranty  is  enough.  Honest  errors  in  the 
statement  of  the  ages  of  ancestors  or  their  nationality  will 
not  avoid  a  policy,  though  made  a  part  of  it  on  condition  of 
avoidance  if  in  any  respect  untrue.  It  is  subversive  of  the 
true  intent  of  the  contract  to  avoid  it  because  of  any  trivial 
misrepresentation  not  material  to  either  party.^  Where  a 
building  is  described  as  two  stories  high,  the  main  part 
being  so,  but  a  small  rear  addition  being  only  one  story, 
the  inaccuracy  is  not  a  breach  of  warranty.^  When  a  vessel 
was  registered  as  captained  by  A.,  who  professedly  had  no 
nautical  experience,  but  was  in  reality  captained  by  B.,  a, 
competent  officer,  it  was  held  that  the  warranty  for  compe- 
tent seamen,  officers,  <fcc.,  was  thus  far  complied  with.'* 
Where  the  policy  stated  that  the  building  was  occupied  as  a 
boarding-house,  and  it  appeared  in  proof  that  the  lower  part 
of  it  contained  a  bar  and  billiard  hall,  all  kept  by  the  same 

1  Per  Duer,  J.,  Westfall  v.  Hudson  River  Fire  Ins.  Co.,  2  Duer  (N.  Y.  Supe- 
riol-  Ct.),  490. 

2  [Germania  Ins.  Co.  v.  Rudwig,  80  Ky.  223,  234  (overruling  Farmers'  &  Dro- 
vers'Ins.  Co.  V.  Curry,  so  far  as  opposite).  The  Act  of  Feb.  4,  1874,  declared 
"  that  all  statements  and  descriptions  in  any  application  for  or  policy  of  insur- 
ance shall  be  deemed  and  held  representations  and  not  warranties,  nor  shall  anv 
misrepresentation,  unless  material  or  fraudulent,  prevent  a  recovery  on  the  pol- 
ic}^"  and  the  court  remarked  that  the  act  was  merely  declaratory  of  the  law  of 
Kentucky.] 

3  [Wilkins  v.  Germania  Fire  Ins.  Co.,  57  Ind.  527.] 

*  [Draper  v.  Com.  Ins.  Co.,  21  N.  Y.  378,  383-84.  Comstock,  Ch.  J.,  dis- 
senting, but  on  grounds  that  do  not  seem  to  go  to  the  substance  of  the  matter. 
The  common  sense  is  with  the  majority  opinion  this  time  for  a  rarity.} 

representations,  their  materiality  is  not  Ins.  L.  J.  473.     See  "Ward  v.  Met'n  L. 

a  question  for  the  jury,  if  the  risk  is  Ins.  Co.,  66  Conn.  227  ;  Foley  v.  RoyaJ 

clearly   material.       Dolan    v.   Missouii  Arcanum,  151  N.  Y.  196. 
Town  Mut.  F.  Ins.  Co.  (Kans.  App.),  29 

311 


§156]  insurance:    fire,   life,    accident,   etc.        [CH.  VIII. 

tenant,  but  no  evidence  was  given  that  the  risk  was  thereby 
increased,  it  was  held  that  there  was  no  breach  of  warranty.  ^ 
Where  a  policy  states  that  the  property  insured  is  in  a  build- 
ing ^''detached  at  least  one  hundred  feet,^^  &c.,  the  italicised 
words  constitute  a  warranty  that  no  buildings  which  consti- 
tute an  exposure  and  increase  the  risk  are  nearer  than  one 
hundred  feet,  but  a  small  office,  seventy-five  feet  from  the 
building,  and  found  by  the  trial  court  not  to  be  an  exposure 
or  to  increase  the  risk,  is  not  a  breach. ^j 

No  particular  form  of  words  is  necessary  to  constitute  a 
warranty.  Any  statement  or  stipulation  upon  the  literal 
truth  or  fulfilment  of  which  in  the  intention  of  the  parties 
the  validity  of  the  contract  is  made  to  depend,  whether  ap- 
pearing as  a  condition  or  warranted,  or  however  otherwise,^ 
amounts  to  a  warranty.*  But  no  particular  form  of  words 
will  make  a  statement  or  stipulation  a  warranty,  not  even 
the  use  of  the  word  "warranty,"  where  it  is  apparent,  from 
the  context  or  from  the  other  parts  of  the  contract,  that  it 
is  not  the  intention  of  the  parties  to  make  the  validity  of 
the  contract  depend  on  the  literal  truth  or  fulfilment  of  the 
statement  or  stipulation.^  [A  statement  in  the  application 
that  the  insurer  is  a  single  man,  is  an  absolute  warranty.^ 
The  words  in  a  policy  on  a  ship  "prohibited  from  the  river 
and  gulf  of  St.  Lawrence,  between  September  1  and  May  1 " 
constitute  a  warranty  that  the  vessel  shall  not  enter  those 
waters  in  the  times  specified.^  A  statement  by  the  assured 
that  the  building  to  be  insured  was  tenanted,  is  not  a  war- 
ranty.^    The  burden  of  proving  the  performance  of  an  ex- 

1  [Martin  v.  State  Ins.  Co.,  44  N.  J.  485.] 

2  [Burleigh  v.  Gebhard  Fire  Ins.  Co.,  90  N.  Y.  220.] 
^  [See  last  note  in  this  section.] 

*  Wright  V.  Eq.  Life  Ass.  Co.  (Supr.  Ct.  N.  Y.),  5  Big.  Life  &  Ace.  Ins.  Cas. 
401. 

^  Sceales  v.  Scanlan,  6  Irish  Law,  367  ;  Howard,  &c.  Ins.  Co.  v.  Cornick,  24 
111.  455  ;  Wheelton  v.  Hanlisty,  8  E.  &  B.  232  ;  Kingslej'  et  al.  v.  New  England 
Mut.  Fire  Ins.  Co.,  8  Cush.  (Mass.)  393  ;  Fitch  v.  Am.  Popular  Life  Ins.  Co.,  59 
N.  Y.  557  ;  jwst,  §  ]  61  r ?  seq. 

6  [.letfries  v.  Union  Mut.  Life  Ins.  Co.,  1  Fed.  Rep.  450,  Mo.  1880  ;  1  Mc- 
Crary,  114.] 

^  [Cobb  V.  Lime  Rock  F.  &  M.  Co.,  58  Me.  326,  327.] 

8  [Schultz  V.  Merchants'  Ins.  Co.,  57  Mo.  331,  337.] 

312 


CH.  VIII.]    WAKRAXTIES. — APPLICATION.— CONSTRUCTION.      [§  157 

press  warranty  rests  upon  the  assured.  ^  When  the  policy 
"prohibited  from  all  guano  islands  except  Chinchas,"  the 
burden  is  on  the  assured  to  show  that  there  has  been  no 
breach  of  the  warranty. '-^J 

§  157.  Warranties  are  distinguished  into  two  kinds: 
affirmative,  or  those  which  allege  the  existence  at  the  time 
of  insurance  of  a  particular  fact,  and  avoid  the  contract  if 
the  allegation  be  untrue;  and  promissory,  or  those  which 
require  that  something  shall  be  done  or  omitted  after  the 
insurance  takes  effect  and  during  its  continuance,  and  avoid 
the  contract  if  the  thing  to  be  done  or  omitted  be  not  done 
or  omitted  according  to  the  terms  of  the  warranty. ^  [When 
by  the  policy  the  assured  agreed  to  use  only  lard  and  sperm 
oil  for  lubricating  purposes,  and  also  stated  that  there  was 
a  force  pump  on  the  premises,  and  agreed  to  have  it  always 
ready  for  use  and  plenty  of  hose  on  hand,  —  these  were  held 
promissory  warranties  in  the  nature  of  conditions  subse- 
quent,* and  any  substantial  breach  would  avoid  the  policy. 
Whether  a  slight  mixture  of  petroleum  is  a  substantial 
breach  is  a  question  for  the  jury.  The  clause  in  a  policy, 
stating  that  the  insured  premises  are  "used"  for  winding 
yarn,  &c.,  is  a  warranty  only  of  the  present  use,  not  of  the 
future.^  Where  the  application,  the  answers  in  which  are 
warranties  by  the  term.s  of  the  contract,  states  that  "  smok- 
ing is  not  allowed  on  the  premises,"  the  policy  is  not  avoided 
although  the  insured  himself  afterward  smoked  on  the  prem- 
ises, the  fire  not  having  originated  from  that  cause.  The 
question  did  not  call  for  a  warranty  of  continuance  of  the 
prohibition  against  smoking,  and  the  statement  being  true 
as  to  the  practice  at  the  time  of  application  there  was  no 
breach  of  warranty.  Indeed  it  does  not  appear  that  the 
prohibition  was  removed,  but  that  the  smoking  was  in  vio- 

1  [:\IcLoon  V.  Com.  Mut.  Ins.  Co.,  100  Mass.  472,  474.] 

2  [Whiton  V.  Albany,  &c.  Ins.  Cos.,  109  Mass.  24,  30.] 

8  Bonadaile  v.  Hunter,  5  M.  &  G.  639  ;  Jennings  v.  Chenango  Co.  Mut. 
Ins.  Co.,  2  Denio  (N.  Y.),  75,  78;  Stout  v.  City  Fire  Ins.  Co.,  12  Iowa, 
371. 

*  [Copp  V.  German- American  Ins.  Co.,  51  Wis.  637,  640.] 

6  [Smith  V.  Mech.  &  Trad.  Ins.  Co.,  32  X.  Y.  S99,  402.] 

313 


§  158]  INSURANCE  :    FIRE,    LIFE,    ACCIDENT,    ETC.         [CH.  VIII. 

lation  of  the  rule  of  the  place.  ^     Where  the  company  asked, 
"What  are  the  facilities  for  extinguishing  fires  ?  "  —  and  the 
answer  was,  "  Force  pump,  and  abundance  of  water ; "  it  was 
held  that  there  was  no  promise  that  the  pump  should  be  in 
good  order  in  the  future.  ^     A  warranty  of  the  existence  of  a 
force  pump  on  the  insured  premises,  at  all  times  ready  for 
use,  extends  to  the  fact  that  there  is  sufficient  power  to  work 
the  pump. 3     The   judge  rightly  thought  that  the  inquiries 
and  facts  of  the  case  distinguished  it  from  Hide  v.  Bruce,* 
■where  Lord  Mansfield  decided  that  a  warranty  that  a  ship 
should  have  twenty  guns,  did  not  include  of  necessity  men 
enough   to  work  them.      Such    constructions    as  those    just 
mentioned  in  2  DougL,  and  in  R.  L,  seem  to  err  from  the 
path  of  common-sense  fairness  as  far  against  the  company 
as  the  literal-fulfilment-of-warranty  idea  errs  in  favor  of  the 
company.     If  a  man  who  is  asked  to  insure  inquires  what 
are  the  facilities  for  putting  out  fires,  and  he  is  told  that 
there  is  a  force  pump,  would  it  be  fair  and  honest  dealing  if 
the  pump  was  in  a  dry  well,   or  broken,   or  there   was  no 
means  of  using  it  ?     And  if  the  pump  was  all  right  when 
the  application  was  made,  but  became  useless  or  was  taken 
away  before  the  policy  was  issued,  would  not  the  assured  be 
held  to  inform  the  company  ?  ^     And  is  he  obliged  to  be  hon- 
est only  until  he  gets  his  grip  on  the  contract,  and  not  after- 
ward ?     Or  is  it  less   important  to  the  company  to  have  a 
good  pump  on  the  premises  after  they  have  taken  the  risk 
than  before  ?     Plain,  fair  sense  seems  to  have  a  little  place 
in  some  parts  of  insurance  law.] 

§  158.  What  constitutes  a  Part  of  the  Contract  ;  Papers 
annexed  and  referred  to.  —  Questions  sometimes  arise  as  to 
whether  the  statements  and  stipulations  are  embraced  in,  or 
constitute  part  of  the  policy.  Usually  the  application,  pro- 
posals, conditions  annexed,  and  by-laws  are  referred  to  in 
the  policy  itself,   and  by  express  terms  made  part  of  it;  or 

1  [Hosfoid  V.  Germania  F.  Ins.  Co.,  127  U.  S.  399,  403.] 

2  [GiUiat  V.  Pawtucket  Mut.  Fire  Ins.  Co.,  8  R.  I.  282.] 

3  [Sayles  v.  N.  W.  Ins.  Co.,  610,  613  ;  2  Curtis  C.  C.  610.] 

4  [3  Doug.  213.] 
6  [See  §  190.] 

314 


CH.  VIII.]    WARRANTIES. — APPLICATION. — CONSTRUCTION.       [§  158 

they  are  declared  to  be  the  basis  upon  which  it  is  madc,^  or 
the  policy  is  declared  to  be  issued  upon  the  faith  thereof. 
When  this  is  tlie  case,  of  course  there  is  no  room  for  doubt.^ 
When,  however,  this  is  not  the  case,  it  becomes  a  question 
of  the  first  importance  to  determine  whether  they  are,  or  are 
not,  part  of  the  policy ;  for  if  they  are  not,  then  they  are  not 
warranties,  but  only  representations,  as  to  the  truth  of,  and 
compliance  with  which  there  is  much  less  strictness  re- 
quired, as  will  be  presently  shown. (a) 

It  is  sufficient  if  they  appear  anywhere  upon  the  face  of 
the  policy,  though  not  written  in  the  body  of  it,  as  upon  the 
margin, 3  or  written  across  it;*  or  are  embraced  in  several 
papers  each  referring  to  the  others  as  parts  of  the  contract,^ 
though  they  are  not  necessarily  warranties  because  they  ap- 
pear upon  the  face  of  the  policy. ^     Nor  is  it  material  that 

1  [When  a  policy  states  that  if  the  declarations  of  the  insured,  "  upon  the  faith. 
of  which  the  policy  is  made,  shall  be  found  to  be  in  any  respect  untrue,"  then 
the  policy  shall  be  void,  "the  entire  truthfulness  of  such  declarations  is  made  a 
condition  precedent  to  recovery,  and  if  proved  either  false  or  fraudulent,  the 
policy  is  void,  whether  or  not  the  matter  be  material  to  the  contract,  or  whether 
the  insurers  issued  the  policy  on  the  faith  of  these  declarations."  Brennan  v. 
Security,  &c.  Co.,  4  Daly,  296.  A  provision  in  a  policy  that  if  answers  should 
be  found  false  or  fraudulent,  the  policy  should  be  void,  does  not  waive  the 
previous  provisions  making  the  answers  warranties.  Foot  v.  /Etna,  &c.  Ins.  Co., 
4  Daly,  285,  293.] 

2  Cushman  v.  United  States  Life  Ins.  Co.,  70  N.  Y.  72. 

3  Bean  v.  Stupart,  Doug.  11  ;  Patch  v.  Phoenix  Mut.  Life  Ins.  Co.,  Sup.  Ct. 
Vt.  1872,  2  Ins.  L.  J.  36. 

*  Kenyon  v.  Berthon,  Doug.  12,  n. 

6  Bobbitt  V.  Liverpool,  &c.  Ins.  Co.,  66  N".  C.  70. 

«  Campbell  v.  New  England  Mut.  Life  Ins.  Co.,  98  Mass.  381. 

(a)  See  Thomson  v.  Weenis,  9  A.  C.  United  L.  Ins.  Co.,  60  id.  727  ;  Fidelity 

671  ;  Davies  v.    jSTational  M,    Ins.  Co.,  &  C.  Co.  v.  Alpert,  67  id.  460  ;  Selby  v. 

ri891]   A.  C.  485  ;  Hainbrough  v.  Mu-  Mutual  L.  Ins.  Co.,  id.  490  ;  Phinney  v. 

tual  L.  Ins.  Co.,  [1895]  W.  IST.  18  ;  Caw-  Mutual  L.  Ins.  Co.,  id.  493  ;  Fidelity 

ley  V.  Nat.  E.  A.  Ass'n,  1  C.  &  E.  597  ;  M.  L.  Ass'n  v.  Miller,  92  id.  63  ;  Chris- 

Cshkosh    Packing    Co.    v.     Mercantile  tian  v.  Conn.  Mut.  L.  Ins.  Co.,  143  Mo. 

Ins.   Co.,  31  Fed.  Rep.   200;  Cotten  v.  460  ;   J.   B.  Ehrsam  M.  Co.  v.  Phenix 

Fidelity    Co.,    41   id.    506;  Pacific  M.  Ins  Co.,  43  Neb.  554  ;  Virginia  F.  &  M. 

Ins.  Co.  V.  Snowden,  58  id.  342  ;  Provi-  Ins.  Co.  v.  Morgan,  90  Va.  290  ;  Albert 

dent  S.   L.  Ass.  Society  v.  Llewellyn,  v.  Mut.  L.  Ins.  Co.,  122  N.  C.  92  ;  Mc- 

id.  940  ;  Manufacturers'  Ace.  I.  Co.  v.  Collum  v.  Mutual  L.  Ins.  Co.,  55  Hun, 

Dorgan,  id.  945  ;  New  York  Ace.  Ins.  103  ;  supra,  §  156,  n.  (a). 
Co.  V.   Clayton,   59  id.  559  ;    Brady  v. 

315 


§  158]         insurance:  fire,  life,  accident,  etc.        [cii.  viii. 

the  application  is  in  pencil.'  And  where  a  policy  printed 
upon  one  half  of  a  sheet  was  delivered,  and  upon  the  other 
half  of  the  sheet  were  the  "conditions  of  insurance,"  these 
conditions,  so  annexed,  were  held  to  be  prima  facie  a  part 
of  the  policy,  although  no  express  reference  was  made  to 
them  in  the  body  of  the  policy.^  Where  certain  "rules  and 
regulations "  appended  to  a  policy  were  referred  to  as 
"accompanying  articles,"  the  reference  was  held  sufficient 
to  make  them  conditions  of  the  contract.  ^  So  of  conditions 
annexed,  though  unsigned.'*  But  a  paper  containing  par- 
ticular statements  relating  to  the  subject-matter  of  insurance 
attached  to  the  policy  at  the  time  it  is  executed  is  no  part 
of  the  policy.^  Nor  is  an  unattached  paper  folded  up  and 
enclosed  in  the  policy  containing  similar  particulars.^  [Nor 
a  piece  of  paper  stuck  on  by  mucilage  and  not  referred  to  in 
the  policy.'^]  And  an  indorsement  on  the  back  of  an  acci- 
dent policy,  showing  the  classification  of  risks  assumed  by 
the  company,  with  a  preliminary  statement  explanatory  of 
the  rights  of  the  different  classes,  can  be  regarded  as  part 
of  the  contract  only  so  far  as  it  is  specifically  referred  to  in 
the  policy  as  constituting  a  part  of  it;  and  a  reference  to 
the  classification  will  not  import  the  preliminary  explana- 
tory statement  into  the  contract.^  So  printed  by-laws  on 
the  back  of  a  policy  are  not  part  of  the  contract,  unless  re- 
ferred to  and  made  part  of  it.^     Nor  is  an  indorsement  of 


1  City  Ins.  Co.  v.  Bvicker  (Pa.),  9  Ins.  L.  J.  784. 

2  Munlock  V.  Chenango  County  Mut.  Ins.  Co.,  2  Comst.  (N.  Y.)  210  ;  Rob- 
erts  V.  Chenango  Connty  Mut.  Ins.  Co.,  3  Hill  (N.  Y.),  501. 

3  Hill  V.  Equitable  Mut.  Fire  Ins.  Co.  (N.  H. ),  6  Ins.  L.J.  3i4. 
*  Kensington  Nat.  Bank  v.  Yerkes,  86  Pa.  St.  227. 

^  Bize  V.  Fletcher,  Doug.  13,  n. 

«  Pawson  V.  Barnevelt,  Doug.  13,  n.  ;  Pawson  v.  Watson,  Cowp.  785.  In  Sil- 
lem  V.  Thornton  (3  E.  &  B.  868),  a  description  of  the  property  contained  in  a 
paper  attached  to  the  policy,  and  referred  to  as  attached  thereto,  was  treated  as 
a  part  of  the  policy,  though  the  point  was  not  discussed.  But  this  was  a  liber- 
ality of  construction  in  favor  of  the  insurers  which  is  inconsistent  with  the  later 
decisions.  In  that  case,  however,  the  decision  would  doubtless  have  been  the 
same  liad  the  attachment  been  treated  as  a  representation. 

■  [Goddard  V.  Ins.  Co.,  67  Tex.  69.] 

8  Adni'rs  of  Stone  v.  U.  S.  Casualty  Co.,  34  N.  J.  L.  371. 

9  Kingsley  u.  New  England  Mut.  Fire  Ins.  Co.,  8  Cush.  (Mass.)  393. 

316 


CH.  VIII.]    WARRAXTIES. — APrLICATION. — CONSTRUCTION.      [§  159 

the  name  and  place  of  business  of  the  insurer  on  the  back  of 
the  policy.^  And  a  reference  to  another  paper  as  an  appli- 
cation or  survey,  or  as  containing  representations,  or  in 
language  not  indicating  that  it  is  the  intent  to  make  the 
application  part  of  the  contract,  does  not  make  it  a  war- 
ranty ;2  nor  is  it  necessary  in  such  a  case  for  the  plaintiff 
to  put  in  the  application  with  the  policy,  in  proving  his  case, 
even  though  the  application  makes  its  own  statements  a  part 
of  the  contract.^ 

Where  the  statute  requires  that  the  "  conditions  of  insur- 
ance shall  be  stated  in  the  body  of  the  policy,"  a  statement 
of  the  substance  of  the  conditions  on  the  face  of  the  policy, 
with  a  distinct  reference  to  them,  printed  on  a  subsequent 
page,  is  sufficient ;  but  a  general  declaration  on  the  face  of 
the  policy  that  it  is  made  with  reference  to  the  conditions 
annexed,  and  that  they  are  a  part  of  the  contract,  docs  not 
make  them  a  part  of  the  contract*  And  the  courts  are  dis- 
inclined to  make  a  paper  by  reference  a  warranty  and  part  of 
the  contract,  unless  clearly  obliged  to.^ 

§  159.  Application  and  Survey,  when  Parts  of  Contract.  — 
As  a  rule,  when  the  application  is  referred  to  as  forming  a 
part  of  the  contract,  the  statements  therein  contained  are 
held  to  have  the  force  and  effect  of  warranties.^  (a)     But  as 

1  Ferrer  v.  Home  Ins.  Co.,  47  Cal.  416. 

2  Fanners'  Ins.  &  Loan  Co.  v.  Snyder,  16  Wend.  (N.  Y. )  481  ;  Hougliton  v. 
Manuf.  Mat.  Fire  Ins.  Co.,  8  Met.  (Mass.)  114. 

3  Edington  v.  Mnt.  Life  Ins.  Co.,  67  N.  Y.  185. 

*  Eastern  Eailroad  i-.  Relief  Ins.  Co.,  98  Mass.  420;  Mullaney  v.  National 
Ins.  Co.,  118  id.  393. 

5  Sayles  V.  North  Western  Ins.  Co.,  2  Curtis  (U.  S.  C.  Ct.),  610  ;  Caniphell  v. 
New  England  Mut.  Life  Ins.  Co.,  98  Mass.  381  ;  Albion  Lead  Works  v.  Williams- 
burgh  City  Fire  Ins.  Co.,  C.  Ct.  (Mass.)  9  Ins.  L.  J.  435  ;  Clinton  v.  Hope  Ins. 
Co.,  45  N.  Y.  454.     See  posf,  §  178. 

6  [Phcenix  Ins.  Co.  v.  Benton,  87  Ind.  132.] 

(«)  An  application  which  is  made  a  20  Ins.  L.  J.  95;  Cronin  t;.  Phila.  F.  Ass'n 
part  of  the  policy,  the  latter  being  ahso  (Mich.),  82  N.  W.  45.  In  case  of  con- 
expressly  based  thereon,  are  construed  flict  between  them,  the  policy  controls, 
together  as  one  contract,  unless  there  is  Goodwin  v.  Provident  Sav.  L.  Ass.  As.s'n, 
clear  evidence  of  fraud.  McMaster  v.  97  Iowa,  226.  But  the  application  must 
New  York  L.  Ins.  Co.,  90  Fed.  Rep.  40;  be  actually  accepted,  and  if  the  appli- 
Parrish  v.  Va.  F.  &  M.  Ins.  Co.  (N.  C),  cant    dies    pending   its    consideration, 

317 


§  ]  59]  INSUKANCE  :   FIRE,   LIFE,   ACCIDENT,    ETC.         [CH.  VIII. 

the  application,  whether  embracing  the  survey,  which  in 
treneral  is  but  a  plan  or  description  of  the  premises,  show- 
ino-  with  more  or  less  completeness  its  condition  and  sur- 
roundino-s  or  having  the  latter  attached  to  it  actually  or  by 
reference,  contains  merely  the  data  upon  which  the  real  con- 
tract is  based,  and  may  be  by  parol  only,  if  the  policy  con- 
tains no  stipulation  making  its  statements  warranties,  they 
will  have  the  force  and  effect  of  representations  only;i  and 
generally  references  to  statements  and  agreements,  in  order 
to  have  the  effect  of  avoiding  the  policy  in  case  the  state- 
ments prove  untrue  or  the  agreement  be  not  strictly  kept, 
must  be  so  explicit  as  to  make  them  equivalent  to  conditions 
precedent.  [The  words  "as  per  application,"  after  a  state- 
ment in  the  policy  of  the  buildings  and  amounts  insured,  is 
not  sufficient  to  make  the  application  a  part  of  the  policy. ^ 
But  the  clause  "false  representations  in  the  application  in 
regard  to  the  condition,  situation,  or  value  of  the  property 
shall  render  the  policy  void,"  makes  the  statements  of  the 
application  warranties  in  a  policy  which  refers  to  the  appli- 

1  Columbia  Ins.  Co.  t;.  Cooper,  50  Pa.  331  ;  Denny  v.  Conway  Stock  &  Mut. 
Ins.  Co.,  13  Gray  (Mass  ),  492  ;  Shoemaker  v.  Glens  Falls  Ins.  Co.,  60  Barb. 
(N.  Y.)  84.  In  May  v.  Buckeye  Mut.  Ins.  Co.,  25  Wis.  291,  a  "  survey"  is  held 
to  be  coextensive  with  the  application  if  made  by  the  agent.  See  also  Albion 
Lead  Works,  &c.  supra. 

2  [Vilas  V.  N.  Y.  Central  Ins.  Co.,  72  N.  Y.  590.] 

there  is  no  completed  contract.  Jacobs  L.  Ass'n  (N.  J.),  22  Ins.  L.  J.  877; 
r.  New  York  L.  Ins.  Co.,  71  Miss.  658.  German  Ins.  Co.  v.  Read  (Ky.),  20 
So  if  there  is  fraud  or  double  dealing  on  Ins.  L.  J.  86  ;  Riegel  v.  American  L. 
the  part  of  the  insurer's  agent  in  deliv-  Ins.  Co.,  153  Penn.  St.  134.  So  if  a 
ering  the  policy  when  he  knows  that  member  of  a  mutual  insurance  company 
the  applicant  has  become  suddenly  and  is  suspended  for  non-payment  of  assess- 
dangerously  ill.  Equitable  Life  Ass.  ments,  and  neglects  during  his  lifetime 
Society  v.  McElroy,  83  Fed.  Rep.  631  ;  to  secure  his  reinstatement  in  accord- 
see  Rossiter  v.  Mtna,  L.  Ins.  Co.,  91  Wis.  ance  with  the  terms  of  his  benefit  cer- 
121.  In  general,  a  life  insurance  con-  tificate  and  the  provisions  of  the  order, 
tract  must  be  complete  before  the  death  his  restoration  to  membership  cannot 
of  the  insured,  but  its  delivery  to  the  be  effected  after  his  death  by  payment 
beneficiary  may  be  made  later.  See  of  the  sum  due  from  him  to  the  com- 
above  ;  Ncwcomb  v.  Provident  Fund  pany  at  the  time  of  his  death,  though 
Society,  5  Col.  App.  140  ;  Paine  v.  Pa-  the  period  within  which,  if  alive,  he 
cific  Mut.  L.  Ins.  Co.,  51  Fed.  Rep.  689;  could  have  secured  his  reinstatement, 
Mutual  L.  Ins.  Co.  v.  Thomson,  94  Ky.  has  not  yet  expired.  Modern  Woodmen 
253  ;  McClave  i;.  Mutual  Reserve  Fund  v.  Jameson,  49  Kansas,  677. 

318 


CH.  YIII.]    WARRANTIES.— APPLICATION.— CONSTRUCTION.      [§  159 

cation  and  makes  it  a  part  thereof. ^  A  prospectus  is  not 
made  part  of  the  policy  by  an  indorsement  on  the  latter  that 
it  may  be  had  gratis,  and  its  statements  are  only  representa- 
tions. 2]  And  unless  it  is  expressly  so  stipulated,  the  state- 
ments or  agreements  should,  on  the  face  of  the  instrument, 
clearly  and  precisely  show  that  it  is  the  intention  of  the 
contracting  parties  to  make  their  literal  truth,  or  literal 
performance,  a  condition  precedent.  If  there  be  any  doubt 
on  this  question,  the  statement  or  agreement  will  be  held  to 
have  the  force  only  of  a  representation  ;3  and  written  state- 
ments not  referred  to,  there  being  no  formal  application, 
will  be  regarded  as  representations,  if  so  intended.*  If 
written  or  oral  statements  are  referred  to  in  the  policy,  they 
may  be  proved  by  parol. ^  And  if  a  policy  be  executed  and 
delivered,  a  survey  subsequently  made  and  handed  in,  the 
policy  not  being  made  conditional  upon  the  procuring  of  the 
survey,  is  inoperative.^  A  mere  reference  to  an  application 
or  survey,  in  general  terms,  does  not  make  its  contents  war- 
ranties. To  effect  this,  there  must  be  other  language  used 
sufficient  to  indicate  that  it  was  the  intention  to  make  the 
paper  referred  to  a  part  of  the  contract.' (a)     And  the  same 

1  [American  Ins.  Co.  v.  Gilbert,  27  Mich.  429.] 

2  [Knickerbocker  L.  Ins.  Co.  v.  Heidel,  8  Lea  (Tenn. ),  488.] 

3  Wheelton  v.  Hardisty,  8  El.  &  B.  232  ;  Stokes  v.  Cox,  1  H.  &  N.  Excb.  320, 
533.  In  the  former  of  the.se  cases  it  seems  to  be  the  opinion  of  the  court  that 
when  the  policy  recited  that  "a  proposal  was  made,  and  that,  'thereupon'  a 
policy  was  issued,"  "  thereupon  "  referred  to  time,  and  not  to  the  proposal  as 
the  basis  of  the  contract.     See  also  ante,  §  156  and  §  161. 

4  Boardman  v.  N.  H.  Mut.  Fire  Ins.  Co.,  20  N.  H.  551. 

s  Clark  i'.  Manufacturers'  Mut.  Fire  Ins.  Co.,  2  W.  &  M.  (U.  S.  C.  Ct.),  472. 
As  to  the  bearing  of  the  "prospectus  "  issued  by  the  insurers  upon  the  contract, 
see  post,  §§  355,  356. 

6  Le  Roy  v.  Park  Fire  Ins.  Co.,  39  N.  Y.  56. 

^  Delonguemare  v.  Tradesmen's  Ins.  Co.,  2  Hall  (N.  Y.  Superior  Ct.),  589  ; 
Jefferson  Ins.  Co.  v.  Cotheal,  7  Wend.  (N.  Y.)  72  ;  Wall  v.  Howard  Ins.  Co.,  14 
Barb.  (N.  Y.)  383  ;  Sheldon  v.  Hartford  Fire  Ins.  Co.,  22  Conn.  235  ;  Common- 
wealth's Ins.  Co.  V.  Monninger,  18  Ind.  352  ;  .Etna  Ins.  Co.  v.  Grube,  6  Minn.  82  ; 
Le  Roy  v.  Market  Ins.  Co.,  39  N.  Y.  90  ;  Steward  v.  Phoenix  Fire  Ins.  Co.,  5 
Hun  (N.  Y.),  261. 

(a)   The  courts  are  reluctant  to  im-  not  clearly  disclose  the  parties'  agree- 

port  terms  of  warranty  contained  in  the  ment  to  the  union  of  the  two  papers  in 

application  for  insurance  into  the  com-  one  contract.     Phoenix  Life  Ins.  Co.  v. 

pleted  agreement  when  the  policy  does  Raddin,    120   U.    S.    183.      But   when 

319 


§159]         insurance:   fire,  life,  accident,  etc.      [ch.  viii. 

is  true  although  there  be  added  to  the  general  terms  of  refer- 
ence the  statement  that  the  reference  is  for  a  more  full  de- 
scription. ^  And  though  the  application  be  referred  to  in 
such  terms  as  to  import  it  into  the  contract,  if  its  state- 
ments be  also  referred  to  as  "representations,"  they  will 
have  that  character  notwithstanding  they  are  made  part  of 
the  contract. 2  So  if  the  reference,  by  a  fair  construction, 
appear  to  be  for  another  purpose  than  to  make  its  statements 
warranties.^  So  if  the  survey  is  referred  to  in  the  policy  as 
on  file  in  one  place,  where  in  fact  it  is,  and  the  conditions 
making  it  a  part  of  the  contract  refer  to  it  as  on  file  in  an- 
other, where  in  fact  it  is, not.*  [In  Canada  even  though  the 
application  is  made  a  part  of  the  policy,  a  misstatement  or 
wrong  answer  will  not,  in  the  absence  of  an  express  war- 
ranty, avoid  the  policy  unless  it  is  material.  The  company 
has  only  the  statutory  defences.  °J  In  Kentucky  and  Louis- 
ville Mutual    Insurance    Company  v.    Southard,^   the   court 

1  Snyder  v.  Farmers'  Ins.  &  Loan  Co.,  13   Wend.  (N.  Y.)  92  ;  s.  c.  affirmed, 
14  id.  481. 

2  Houghton  V.  Manuf.  Ins.  Co.,  8  Met.  (Mass.)  114  ;  American  Popular  Life 
Ins.  Co.  V.  Day,  39  N.  J.  (Law)  89. 

3  Campbell  v.  New  England  Mut.  Life  Ins.  Co.,  98  Mass.  381. 
*  Clinton  v.  Hope  Ins.  Co.,  45  N.  Y.  454. 

6  [Goring  v.  London  Mut.  Fire  Ins.  Co.,  10  Ont.  R.  236,  245,  246.] 
6  8  B.  Mon.  (Ky.)  634. 

there  is  a  distinct  agreement  that  the  upon  a  particular  subject,  such  as  the 

application  is  a  part  of  the  contract,  nature   and   amount   of   incumbrances, 

and  the  statements  in  the  application,  otherwise  than  by  mortgage,  they  can- 

upon  w^hich  the  contract  is  based,  are  not  object  that  no  information  is  given 

expressly  declared  to  be  warranties,  the  on  that  subject.     Hosford  v.  Gerniania 

insured's  intent  to  bind  himself  to  the  Fire  Ins.  Co.,  127  U.  S.  399  ;  American 

exact  truth  in  his  answers,  even  as  to  Artistic  G.   S.  Co.  v.  Glenn  Falls   Ins. 

immaterial   facts,   is   adequately  mani-  Co.,  20  N.  Y.  S.  646,     And  although  a 

fested,    and     the     parties    themselves  policy  of  insurance  in  a  mutual  fire  in- 

tliereby  agree  upon  the  materiality  of  surance   company   contains   terms   and 

the  things  warranted.     Burritt  v.  Sara-  conditions  not  included  in  the  applica- 

toga   County  M.    F.    Ins.  Co.,  5    Hill  tion  therefor,  if  they  are  not  unusual 

(N.  Y.),  188  ;  Armour  v.  Transatlantic  or  extraordinary,  this  does  not  render 

F.  Ins.  Co.,  90  N.  Y.  450  ;  O'Shangh-  necessary  the  acceptance  of  the  policy 

nessy  v.  Working  Women's  Co-op.  Ass'n,  by  the  assured  in  order  to  make  it  bind- 

28  N.  Y.  S.  761  ;  American  Credit  In-  ing  on  him,  but  the  contract  becomes 

demnity  Co.    v.   Carrollton  F.  M.  Co.,  complete  on  the  delivery  of  the  policy, 

95  Fed.  Rep.  Ill  ;  Mutual  L,  Ins.  Co.  without  any  further  assent  on  his  part. 

V.  Nichols  (Tex.   Civ.  App.),  24  S.  W,  Commonwealth    Mut.    F.    Ins.    Co.    V. 

910.     If  the  insurers  put  no  question  Kuabe  Co.,  171  Mass.  265. 

320 


CH.  YIII.]    WAKRANTIES. — APrLICATION. — CONSTRUCTIOX.       [§  159 

were  indisposed  to  admit  that  the  principle  which  converts 
into  a  warranty  every  matter  of  fact  or  description  relative 
to  the  property  insured,  which  the  parties  have  inserted  in 
the  policy,  is  applicable  in  cases  of  fire  insurance  to  any 
such  matter  not  inserted  in  the  policy  nor  written  upon  it, 
though  it  be  referred  to  therein  as  a  part  of  the  policy,  even 
if  it  be  the  rule  in  marine  insurance,  which  was  doubted. (a) 
Nor  can  a  reference  in  a  new  policy  to  a  former  survey  at 
the  office  of  the  agent  through  whom  a  foreign  insurance 
had  been  effected,  be  considered  as  bringing  that  survey  into 
the  new  contract  as  a  "  survey  on  file  at  the  office, "  so  as  to 
make  it  a  part  of  the  new  contract,  there  being  no  new 
application  or  survey  or  plan  presented  or  filed  at  the  office. ^ 
Upon  the  same  general  principles,  a  party  who  accepts  a 
policy  "in  reference  to  a  survey  on  file  at  the  office,"  the 
by-laws  making  "survey,  plan,  and  description"  "a  war- 
ranty on  the  part  of  the  insured,"  is  not  responsible  for  ex- 
ecutory representations  contained  in  the  application,  of 
which  the  survey  formed  a  part,  it  appearing  that  the  appli- 
cation was  never  signed  by  the  insured,  nor  by  any  one 
authorized  by  him  so  to  do.  While,  having  accepted  the 
policy  subject  to  the  survey,  he  will  be  held  responsible  for 
the  accuracy  of  that,  yet  a  survey  imports  only  a  plan  and 
description  of  the  present  existing  state,  condition,  and 
mode  of  use  of  the  property,  and  does  not  by  fair  intend- 
ment embrace  statements  or  representations  of  a  promissory 
or  executory  nature  relating  to  contemplated  alterations  or 
improvements  in  the  property,  or  to  the  mode  in  which  the 
premises  are  to  be  occupied  during  the  continuance  of  the 
policy ;  and  for  these  latter,  not  being  shown  to  have  recog- 

1  Clinton  v.  Hope  Ins.  Co.,  45  N.  Y.  4.')4. 

(a)    Now,  in  Kentucky,  by  a  statute  apply  to  an   application   made   out  in 

enacted  in  1874,  all  the  statements  in  Kentucky  and  accepted  in  New  York, 

the  application  are  to  he  held  merely  if  Kentucky  is  not  made  the  place  of 

representations,  and  not  to  avoid  the  performance.     American  Credit  Indem- 

policy    unless    material   or   fraudulent,  nity  Co.  v.  CarroUton  F.  M.  Co.,  95  Fed. 

See  Germania  Ins.  Co.  v.  Rudwig,  80  Rep.  Ill,  113. 
Ky.  223,  234.     This  statute  does  not 

VOL.  I.— 21  321 


§  IGl]         insfkance:  fike,  life,  accident,  etc.      [ch.  viii. 

nizcd  or  adopted  them,  he  is  not  responsible.  ^  But  the 
applicant  is  presumed  to  know  the  contents  of  the  paper  he 
sif^ns,  and,  when  it  is  permissible  to  show  the  contrary,  the 
burden  of  proof  is  on  him  who  alleges  ignorance. ^ 

§  160.  Qualified  Reference.  —  And  where  the  language  of 
reference  is  qualified,  and  does  not  clearly  intend  to  make 
the  application  a  part  of  the  policy,  the  doubt  will  be  con- 
strued against  the  company.  Thus,  "  reference  being  had  to 
the  application  for  a  more  particular  description,  and  the 
conditions  annexed,  as  forming  a  part  of  the  policy,"  has 
been  held  to  import  the  conditions  into  the  contract,  but  to 
leave  the  statements  in  the  application  without  to  stand  upon 
the  footing  of  representations,  being  referred  to  merely  for 
the  purpose  of  describing  and  identifying  the  property  in- 
sured.^ So  if  the  statements,  alleged  to  be  warranties,  are 
declared  to  be  true  so  far  as  risk  and  value  are  concerned, 
they  are  warranties  as  to  these  particulars,  but  representa- 
tions as  to  others.*  So  if  the  provisions  of  the  policy  are  con- 
tradictory, or  so  framed  as  to  leave  room  for  construction.^ 

§  161.  Qualified  Reference;  Knowledge;  Belief.  —  So,  al- 
though the  application  be  expressly  made  a  part  of  the  pol- 
icy, its  statements  will  not  be  regarded  as  warranties  if 
qualified  by  other  stipulations  in  either  which  afford  a  fair 
inference  that  the  parties  themselves  did  not  so  intend  them. 
The  by-laws  may  provide  that  the  application  shall  be  a  part 
of  the  policy  and  "a  warranty  on  the  part  of  the  insured," 
and  that  "the  policy  shall  be  void  unless  the  applicant  shall 
make  a  correct  description   and   statement  of  all  facts  in- 

1  Denny  y.  Comvay  Stock  &  Mut.  Fire  Ins.  Co.,  13  Gray  (Mass.),  492  ;  Ly- 
coming Ins.  Co.  V.  Jackson,  83  111.  302  ;  Albion  Lead  Works  v.  "Williamsburgh 
Fire  Ins.  Co.,  C.  Ct.  (Mass.),  9  Ins.  L.  J.  435  ;  Clinton  v.  Hope  Ins.  Co.,  45  N.  Y. 
454. 

2  Hartford  Life  Ins.  Co.  v.  Gray,  80  111.  28  ;  s.  c.  again  before  the  courts,  8 
Ins.  L.  J.  611  ;  Hanson  v.  Milwaukie,  &c.  Ins.  Co.,  45  Wis.  321  ;  Andes  Ins.  Co. 
V.  Shipman,  77  111.  189  ;  Chatillon  v.  Canadian,  &c.  Ins.  Co.,  27  U.  C.  (C.  P.) 
450. 

8  Trench  v.  Chenango  County  Mut.  Ins.  Co.,  7  Hill  (N.  Y.),  122. 

*  Howard  Fire  &  Unr.  Ins.  Co.  v.  Cornick,  24  111.  455  ;  Lindsey  v.  Union 
Mut.  Ins.  Co.,  3  R.  I.  157  ;  Wilson  v.  Standard  Ins.  Co.,  U,  0.  (C.  P.)  15  Can. 
L.  J.  N.  s.  32. 

5  National  Bank  v.  Insurance  Co.,  95  U.  S.  673. 
•^00 


en.  VIII.]   WARRANTIES. — APPLICATION.— CONSTRUCTION.      [§161 

quired  for  in  the  application,  and  also  all  other  facts  mate- 
rial in  reference  to  the  insurance,  or  to  the  risk;"  yet,  if  in 
the  application  it  is  agreed  that  it  is  "a  correct  description 
of  the  property  so  far  as  regards  the  condition,  situation, 
value,  and  risk  on  the  same,"  or  so  far  as  is  known  to  the 
applicant  or  is  material  to  the  risk,  and  that  "the  misrepre- 
sentation or  suppression  of  material  facts  "  shall  destroy  the 
applicant's  claim  for  damages,  —  these  latter  stipulations, 
when  construed  together  with  the  former,  being  not  only 
unnecessary,  if  the  assured  is  to  be  held  to  the  literal  and 
exact  truth  of  his  answers,  but  inconsistent  with  holding 
them  to  be  strict  warranties,  reduce  the  answers  to  the 
quality  of  representations.  ^  These  cases  afford  a  good  illus- 
tration of  the  over-caution  in  which  insurance  companies 
sometimes  indulge,  as  well  as  of  the  great  importance,  in 
the  construction  of  the  contract  of  insurance,  of  carefully 
comparing  the  several  stipulations  with  each  other. ^  So, 
too,  reference  in  the  proposal  for  a  reinsurance  to  the  state- 
ments made  in  the  proposal  for  the  original  insurance  as  be- 
lieved to  be  true,  is  no  warranty  of  their  truth,  but  simply  a 
warranty  of  the  belief  in  their  truth.^  [An  acknowledgment 
at  the  end  of  an  application  warranting  the  foregoing  state- 
ments "to  the  best  of  my  knowledge  and  belief"  qualifies  the 
undertaking  that  the  statements  are  "in  all  respects  true," 
and  that  any  "  untrue  or  fraudulent  statements  "  should  for- 
feit the  insurance.*  When  a  policy  expressly  makes  the 
application  a  part  of  it,  and  all  the  answers  therein  war- 
ranties, it  must  be  held  to  mean  such  warranties  as  are 
stipulated  for  in  the  application,  and  where  the  application 
declares  that  the  answers  are  true  "so  far  as  the  same  are 
known  and  are  material,"  this  clause  qualifies  the  nature  of 

1  Elliott  V.  Hamilton  Mut.  Ins.  Co.,  13  Gray  (Mass.),  139  ;  .Etna  Ins.  Co.  v. 
Grabe,  6  Minn.  82;  Longhiirst  v.  Conway  Fire  Ins.  Co.,  U.  S.  Dist.  Ct,  Iowa, 
1861,  cited  in  Bates,  Dig.  Fire  Ins.  Dec;  Redman  v.  Hartford  Fire  Ins.  Co.,  47 
Wis.  89  ;  Fitch  v.  Am.  Popular,  &c.  Ins.  Co.,  59  N.  Y.  557. 

2  See  also  Watertown  Fire  Ins.  Co.  v.  Simons  (Pa.),  9  Ins.  L.  J.  597  ;  Joyce 
i;.  Maine  Ins.  Co.,  45  Me.  168  ;  FrisWe  v.  Fayette  Mut.  Ins.  Co.,  27  Pa.  St.  325. 

8  Wheelton  v.  Hardisty,  8  El.  &  B.  232. 

*  [Clapp  V.  Mass.  Benefit  Ass.,  146  Mass.  519.] 

323 


§  162]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  VIII. 

the  -vrarranty,  and  changes  it  from  an  absokite  to  a  qualified 
one.^  When  the  applicant  states  in  his  application  that  the 
same  is  a  just,  true,  full,  &c.,  exposition  so  far  as  the  facts 
are  known  to  him,  it  is  immaterial  whether  it  be  considered 
a  warranty  or  a  representation.^  Where  the  insured  declared 
that  he  answered  to  the  best  of  his  knowledge  and  belief,  and 
omitted  to  state  an  accident  from  the  results  of  which  he 
was  in  bed  five  weeks,  it  is  for  the  jury  to  say  whether  he 
wilfully  withheld  the  facts  or  forgot  them,  or  honestly 
thought  them  of  too  little  consequence  to  be  mentioned.^ 
Where  the  application  is  made  a  part  of  the  policy,  and 
"warranted  by  the  assured  to  be  true  in  all  respects,"  but 
this  clause  is  followed  by  the  statement  that  "  if  this  policy 
has  been  obtained  by  or  through  any  fraud,  misrepresenta- 
tion, or  concealment,  said  policy  shall  be  absolutely  null 
and  void,"  immaterial  answers  honestly  made  will  not  in- 
validate the  contract.^  But  where  a  policy  contained  the 
clause,  "The  basis  of  the  contract  is  said  application  and 
obligation,  which  shall  be  taken  and  deemed  as  a  part  of 
this  policy,  and  as  a  warranty  on  the  part  of  the  assured, 
and  any  false  or  untrue  answers  and  statements  material  to 
the  hazard  of  the  risk  shall  render  the  policy  null  and  void." 
It  was  held  that  the  application  being  made  a  part  of  the 
policy  the  answers  in  it  became  warranties,  and  if  untrue 
avoided  the  politjy  whether  material  or  not.^  This  decision 
is  not  in  accord  with  the  liberal  spirit  which  seizes  every 
indication  that  the  parties  meant  to  exclude  forfeitures  for 
immaterial  errors,  there  being  no  fraud.  Honest  errors 
manifestly  and  undoubtedly  immaterial  ought  to  be  excluded 
by  the  law.] 

§  162.  Constructive  "Warranties  not  favored.  —  The  courts 
will  hold  a  stipulation,  whether  contained  in  the  policy  or 
in  the  application,  to  be  a  representation  rather  than  a  war- 

1  [Redman  v.  Hartford  Five  Ins.  Co.,  47  Wis.  89,  100.] 

2  [Mnlville  V.  Adams,  19  Fed.  Rep.  887,  890.] 

3  [Miller  v.  Confederation  Life  Ass.  Co.,  11  Ont.  R.  120  (affirmed,  14  Can. 
S.  C.  R.  330).] 

*  [Continental  Life  Ins.  Co.  v.  Rogers,  119  111.  474.] 

*  [Chrisman  v.  State  Ins.  Co.,  16  Or.  290,  citing  many  cases.] 

324 


CH.  VIII.]    WARRANTIES. — APPLICATION. — CONSTRUCTION.      [§  162 

ranty,  when  there  is  room  for  doubt,  from  ambiguity  of  lan- 
guage or  otherwise.^  Thus,  where  the  policy  was  made  with 
reference  to  the  conditions  annexed,  but  these  were  referred 
to  not  as  conditions  precedent,  nor  as  forming  part  of  the 
policy,  but  "for  a  mtre  particular  description,"  or  "to  be 
used  and  resorted  to  in  order  to  explain  the  rights  and  obli- 
gations of  the  parties,  in  cases  not  otherwise  specially  pro- 
vided for,"  the  court  said  these  were  merely  the  statements 
of  a  collateral  document,  which  both  parties  agreed  to  as  an 
authoritative  exposition  of  what  they  both  understood  as  the 
facts,  on  the  assumption  and  truth  of  which  they  contracted, 
and  the  relations  in  which  they  stood  to  each  other. ^  So  the 
words  "on  condition"  do  not  necessarily  import  a  condition 
precedent  equivalent  to  a  warranty,  since  the  manner  and 
circumstances  under  which  they  are  used  may  indicate  that 
such  was  not  the  purpose  or  intent.  Thus  where  the  words, 
"on  condition  that  the  applicant  take  all  risk  from  cotton 
waste,"  were  used  not  in  the  same  context  with  the  other 
cjonditions,  but  inserted  between  the  statement  of  the  amount 
insured  and  the  statement  of  the  locus  of  the  property,  it  was 
held  that  these  words  so  used  did  not  constitute  a  condition 
in  the  legal  sense,  as  there  was  nothing  which  the  insured 

1  [The  courts  lean  toward  construing  answers  as  representations,  not  as  war- 
ranties. Schwarzbach  v.  Protective  Union,  25  W.  Va.  622,  653;  Moulor  v. 
Amer.  Life  Ins.  Co.,  Ill  U.  S.  335.  Unless  it  is  shown  by  the  form  of  the  con- 
tract that  the  parties  intended  a  given  statement  to  be  taken  as  a  warranty,  it 
will  be  construed  as  a  representation,  and  substantial  truth  will  be  enough. 
Phcenix  Life  Ins.  Co.  v.  Raddiu,  120  U.  S.  183.  The  clearest  and  most  unequi- 
vocal language  is  necessary  to  create  a  warranty.  All  statements  of  doubtful 
meaning  will  be  construed  as  representations  merely.  Ala.  Gold  Life  Ins.  Co. 
V.  Johnston,  80  Ala.  467  ;  Merchants'  &  Mechanics'  Ins.  Co.  v.  Schroeder,  18 
Brad.  216.  And  where  one  part  of  the  policy  tends  to  show  an  intent  to  make 
the  answers  warranties,  and  another  part  treats  them  as  representations,  they 
will  be  treated  as  representations,  or  if  warranties  at  all,  at  least  only  to  the 
extent  of  an  honest  belief  in  their  truth.  Id.  See  Northwestern  Benevolent 
&  Mut.  Aid  Ass.  v.  Cain,  21  Brad.  471,  for  a  discussion  of  cases  in  which  stipu- 
lations are  held  representations  and  not  warranties.] 

2  Daniels  et  al.  v.  Hudson  River  Fire  Ins.  Co.,  12  Cush.  (Mass.)  416,  426  ; 
Westfall  V.  Hudson  River  Fire  Ins.  Co.,  2  Duer  (N.  Y.  Superior  Ct.),  490.  See 
also  Delonguemare  v.  Tradesmen's  Ins.  Co.,  2  Hall  (N.  Y.  Superior  Ct. ),  589; 
Trench  v.  Chenango  County  Mut.  Ins.  Co.,  7  Hill  (N.  Y.),  122  ;  Wilson  v.  Con- 
way Ins.  Co.,  4  R.  I.  141.  The  early  case  of  Duncan  v.  Sun  Fire  Ins.  Co.,  6 
Wend.  (N.  Y.)  488,  to  the  contrary,  seems  not  to  have  been  well  considered. 

325 


§  163]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.        [CH.  VIII. 

or  any  other  party  was  to  do  or  omit,  by  way  of  performing 
the  supposed  condition,  and  no  event  was  to  happen  that  it 
might  be  saved.  They  amount  simply  to  a  declaration  on 
the^part  of  the  insurers  that  they  will  not  pay  a  loss  by  fire 
originating  in  cotton  waste. ^ 

S  163.    Constructive  Warranties  {continued).  —  Some  obser- 
vations upon  this  point  fell  from  the  court  in  a  case  in  Ken- 
tucky, which  are  worthy  of  note,   and  which,  though  their 
spirit  has  in  too  many  instances  been  departed  from,  may  be 
considered  as  illustrative  of  the  present  tendency  of  judicial 
decision.     "  Whatever  might  be  the  doctrine  in  case  of  mar- 
ine policies,"  says  Marshall,  C.  J.,  "in  making  which  the 
insurer  is  in  general  wholly  dependent  upon  the  statements 
of  the  insured,  with  regard  to  the  property  and  the  risk,  it 
has  been  seriously  doubted,  and,  so  far  as  we  know,  has  not 
been  established  by  judicial  decisions,  whether  the  principle 
of  construing  every  matter  of  mere  description  contained  "in 
the  body  of  the  policy  into  a  warranty  should   be  applied 
with  the  same  strictness  to  fire  policies,   where  the  misde- 
scription is  most  generally  the  mistake  of  the  underwriter's 
own  surveyor.     These  warranties  being  conditions  precedent, 
which  must  be  performed  or  be  true,  however  immaterial, 
there  is  an  obvious  propriety  that  they  should  be  contained 
in  the  policy,  which  is  to  be  kept  by  the  insured,  not  only 
that  he  may  be  enabled  to  make  the  proper  averments  when 
he  comes  to  declare,  but  that  he  may  be  fully  apprised  of  the 
effect  intended  to  be  given  to  his  statements;  since  if  they 
are  considered  merely  as  representations,  it  is  sufficient  that 
they  were  made  without  fraud,  and  are  substantially  true  in 
every  point  material  to  the  risk. "  ^ 

1  Kingsley  et  al.  v.  New  England  Mut.  Fire  Ins.  Co.,  8  Cush.  (Mass.)  393. 

2  The  opinion  proceeds :  "  Under  these  considerations,  we  are  of  opinion  that 
it  is  at  least  safe  to  conclude  that  the  reference  in  this  policy  to  the  application 
and  survey  as  a  part  thereof,  being  a  part  of  the  clause  which  vacates  the  policy 
if  the  premises  should,  at  the  time  of  any  fire,  be  occupied  for  purposes  more 
hazardous  than  at  the  date  of  the  instrument,  should  be  understood  as  merely 
identifying  the  description  and  condition  of  the  property  at  that  time,  for  the 
standard  of  comparison  in  case  of  fire ;  that  no  other  force  or  eff'ect  was  intended 
to  be  given  to  the  writings  referred  to,  than  as  being  a  description  of  the  nature 
or  purposes  of  the  occupation  of  the  building  at  that  time  ;  and  that  as  the  clause 

326 


CH.  VIII.]    WARRANTIES.— APPLICATION. — CONSTRUCTION.      [§  164 

§  164.  Constructive  Warranties  {continued).  — It  tllUS  be- 
comes apparent  that,  though  the  statements  and  stipulations 
on  the  part  of  the  insured  are  inserted,  or  are  referred  to, 
in  the  policy  itself,  it  often  becomes  difficult  to  determine 
whether  they  are  warranties  or  representations.  They  are 
not  necessarily  warranties  because  they  appear  on  the  face 
of  the  policy.  In  order  to  have  the  force  of  a  warranty,  the 
statement  must  indeed  constitute  a  part  of  the  contract ;  but 
it  by  no  means  follows  that  every  statement  which  con- 
stitutes a  part  of  the  contract  is  therefore  a  warranty. i 
Whether  they  are  so  or  not  will  depend  upon  the  form  of 

points  expressly  to  the  sort  of  variance  against  which  it  intends  to  guard  (viz.  a 
more  hazardous  occupation),  and  declares  expressly  the  consequences  of  such 
variance,  these  declarations  should  be  regarded  as  expressing  the  entire  scope  and 
object  of  the  reference,  beyond  which  it  cannot  be  carried  without  violating  the 
apparent  intention  of  the  i)arties.  The  entire  clause,  including  the  reference  to 
the  application  and  the  survey,  was  intended  to  secure  the  insurers  from  loss  by  a 
change  in  the  occupancy  of  the  premises  which  should  increase  the  risk,  and  not 
to  bind  the  other  party  to  the  truth  of  immaterial  statements  not  affecting  the 
risk,  nor  to  preclude  him  from  changes  either  in  the  plan  or  occupation  of  the 
premises,  unless  the  hazard  should  be  thereby  increased.  And  the  written  appli- 
cation and  survey  were  referred  to  as  fixing  the  standard  of  comparison,  and  not 
for  the  purpose  of  creating  or  evidencing  any  covenant  or  warranty  on  the  part  of 
the  insured,  as  to  the  condition  or  occupation  of  the  premises  at  the  time  the  in- 
surance was  made.  The  only  covenant  or  warranty  on  this  subject  is  contained 
in  tliat  part  of  the  policy  which  describes  the  building  as  a  mansion-house  situ- 
ated, &c.,  and  states  that  it  was  then  occupied  as  a  dwelling-house."  Kentucky 
&  Louisville  Mut.  Ins.  Co.  v.  Southard,  8  B.  Mon.  634,  637.  See  also  Worswick 
V.  Canada,  &c.  Ins.  Co.,  Ct.  of  App.  Ont.,  9  Ins.  L.  J.  299.  And  the  statute  of 
Massachusetts  (Stat.  1864,  c.  196,  §  1),  which  is  as  follows:  "In  all  insurance 
against  loss  by  fire  hereafter  made  by  companies  chartered  or  doing  business  in 
this  Commonwealth,  the  conditions  of  the  insurance  shall  be  stated  in  the  body 
of  the  policy,  and  neither  the  application  of  the  insured  nor  the  by-laws  of  the 
company  shall  be  considered  as  a  warranty  or  part  of  the  contract  except  so  far  as 
they  are  incorporated  in  full  in  the  policy,  and  so  appear  on  its  face  before  the 
signatures  of  the  officers  of  the  company,"  was  but  a  legislative  expression  of  the 
judicial  tendency  at  that  time.  And  now  the  courts  seem  to  have  addressed 
themselves  to  the  question,  how  far  what  is  expressly  stated  in  the  policy,  and  is 
made  part  of  the  contract,  is  necessarily  a  warranty,  with  the  evident  disposition 
to  restrict  the  effect  of  such  an  express  statement  in  the  policy  to  material  and 
substantial  matters  affecting  the  risk.  See  as  to  statutes  of  other  States,  post, 
§  180  a. 

1  [It  has  been  held  that  a  stipulation  in  a  policy  to  keep  all  openings  of  the 
building  closed,  is  not  a  warranty,  because  it  is  not  on  express  penalty  of  for- 
feiture, and  therefore  negligence  of  the  assured  must  be  shown  in  allowing 
the  openings  to  be  unclosed.  Eakin  v.  Home  Ins.  Co.,  1  Tex.  App.  Civ.  Cas. 
§370.] 

327 


§  164]  insueance:  fire,  life,  accident,  etc.      [ch.  viii. 

expression  used,  the  apparent  purpose  of  the  insertion,  and 
sometimes  upon  the  connection  or  relation  to  other  parts  of 
the  instrument.  So,  also,  if  the  statements  contained  in  a 
separate  paper  are  referred  to  and  made  part  of  the  contract, 
yet  if  the  reference  appear  to  be  made  for  a  special  purpose, 
and  not  with  a  view  to  import  the  separate  paper  into  the 
policy  as  a  part  of  the  contract,  the  statements  will  not 
thereby  be  transformed  from  representations  into  warranties. 
Warranties  can  only  exist  upon  the  fair  interpretation  and 
clear  intendment  of  the  words  of  the  parties,  and,  since 
courts  will  not  favor  warranties  by  construction,  they  will 
not  be  bound  when,  from  the  form  of  the  expression  used,  or 
other  reason,  there  appears  to  be  no  intention  to  enter  into 
them.  Parties  will  not  be  held  to  have  entered  into  the 
contract  of  warranty  unless  they  clearly  intended  it;  and  if 
the  policy  itself  does  not  distinctly  identify  and  refer  to  the 
application,  and  make  it  a  part  of  the  contract,  though  the 
application  refers  to  the  policy  as  containing  a  warranty,  or 
if  the  reference  in  the  policy  to  statements  contained  in  an- 
other paper  do  not  clearly  show  that  the  reference  is  made 
for  the  purpose  of  giving  to  the  statement  so  referred  to  the 
force  and  effect  of  warranties,  as  if  they  be  referred  to  as 
"statements"  or  "representations,"  or  if  the  reference  ap- 
pear to  be  made  for  another  purpose,  or  if  the  purpose  be 
doubtful,  —  such  reference  will  not  convert  the  statements 
into  warranties.^  In  Houghton  v.  Manufacturers'  Mutual 
Fire  Insurance  Company, ^  it  was  held  that  though  the  appli- 
cation was  by  reference  made  part  of  the  policy,  yet  as  the 
statements  in  the  application  were  referred  to  as  representa- 
tions, and  so  denominated  in  that  clause  of  the  policy  which 
referred  to  them,  they  were  to  be  treated  as  such,  and  to  be 

1  Conover  v.  Mass.  Mut.  Life  Ins.  Co.,  C.  Ct.  (Mo.)  3  Dill.  217  ;  Campbell 
V.  New  England  Mut.  Life  Ins.  Co.,  98  Mass,  381  ;  Miller  v.  Mut.  Benefit  Life 
Ins.  Co.,  31  Iowa,  216;  Blood?;.  Howard  Fire  Ins.  Co.,  12  Cush.  (Mass.)  472; 
Towne  v.  Fitchburg  Ins.  Co.,  7  Allen  (Mass.),  51  ;  Jefferson  Ins.  Co.  v.  Cotheal, 
7  Wend.  (N.  Y.)  72;  Snyder  v.  Farmers'  Ins.  &  Loan  Co.,  13  id.  82  ;  Wilson  v. 
Conway,  4  R.  I.  141  ;  Stebhins  v.  Globe  Ins.  Co.,  2  Hall  (N.  Y.  Superior  Ct.), 
632  ;  Kentucky  &  Louisville  Mut.  Ins.  Co.  v.  Southard,  8  B.  Mon.  (Ky.)  634  ; 
Ameriean  Popular  Life  Ins.  Co.  v.  Day,  39  N.  J.  (Law)  89. 

2  8  Met.  (Mass.)  114, 

328 


CH.  VIII.]    WARKANTIES.— APPLICATION. — CONSTRUCTION.      [§  165 

regarded  rather  as  having  the  legal  effect  of  representations 
than  of  warranties,  as  understood  in  the  law  of  marine  in- 
surance, though  partaking  in  some  measure  of  the  character 
of  both.  They  are  like  representations  in  requiring  that  the 
facts  stated  shall  be  substantially  true  and  correct,  and,  so 
far  as  they  are  executory,  that  they  shall  be  substantially 
complied  with;  but  not  like  warranties  in  requiring  an  exact 
and  literal  compliance.  And  when  it  is  said  that  the  state- 
ments in  an  application  referred  to  as  forming  a  part  of  the 
policy  are  by  that  reference  imported  into  the  policy  and  be- 
come warranties,  and,  like  warranties,  must  be  literally  true 
and  exactly  complied  with,  it  is  apparent  from  the  cases  just 
cited,  and  from  many  others,  that  the  language  of  the  courts 
in  their  assertion  of  the  rule  is  somewhat  more  positive  and 
vigorous  than  is  justified  by  the  manner  in  which  the  rule, 
thus  strongly  and  positively  asserted,  has  been  illustrated  by 
practical  application.  In  truth,  the  courts  have  apparently 
begun  to  see  that  they  have  gone  far  enough,  under  the  lead 
of  arbitrary  rules,  in  finding  constructive  warranties  in  the 
immaterial,  unguarded,  and  oftentimes  superfluous  state- 
ments contained  in  the  application.  ^ 

§165.  Constructive  Warranties  {continued). — The  case  of 
Campbell  v.  New  England  Mutual  Life  Insurance  Company  2 
was  cited  and  approved  (after  quoting  from  it  largely)  in 
Price  V.  Phoenix  Mutual  Life  Insurance  Company,^  upon  the 
point  that  statements  contained  in  the  application  will  not 
'be  held  to  be  warranties,  whether  referred  to  and  made  part 
of  the  policy  or  not,  if  elsewhere  in  the  contract  there  can 
be  found  reason  to  suppose  that  such  was  not  the  clear 
understanding  and  intent  of  the  parties,  and  seems  to  have 
been  regarded,  not  justly  as  it  seems  to  us,  by  the  court  in 
the   latter  case   as   irreconcilable  with  prior  cases  in  Mas- 

1  Boardman  v.  IST.  H.  Mut.  Fire  Ins.  Co.,  20  N.  H.  .557  ;  Hough  v.  City  Fire 
Ins.  Co.,  29  Conn.  10  ;  Billings  v.  Tolland  Co.  Mut.  Fire  Ins.  Co.,  20  Conn.  139  ; 
Watertown  Fire  Ins.  Co.  v.  Simons  (Pa.  St.),  9  Ins.  L.  J.  597  ;  Virginia  Fire  & 
Mar.  Ins.  Co.  v.  Kloeber,  31  Va.  749. 

2  98  Mass.  381. 

8  17  Minn.  497.  See  also  Hurd  v.  Masonic  Mut.  Ben.  Soc,  6  Ins.  L.  J.  792 ,♦ 
ante,  §  160. 

329 


§  165  A]       INSURANCE :    FIRE,  LIFE,   ACCIDENT,   ETC.         [CH.  VIII. 

sachusetts.  It  was,  however,  justly  regarded  as  very  de- 
cisively indicating  the  purpose  of  that  court  to  confine 
constructive  warranties  within  stricter  limits,  and  beyond 
question  as  irreconcilable  with  numerous  dicta  both  in  that 
court  and  others,  which  have  often  had  too- much  influence 
in  deciding  adjudged  cases.  In  the  latter  case  there  was  no 
material  respect,  upon  the  point  under  consideration,  in 
which  the  contract  differed  from  that  in  the  Massachusetts 
case,  the  court  regarding  the  fact  that  in  one  case  the  state- 
ment was  made  "the  basis  of  the  policy,"  while  in  the  other 
the  policy  was  declared  to  be  issued  "upon  the  faith  "  of  the 
statements  as  immaterial.  And  independently  of  the  author- 
ity of  that  case,  as  the  result  of  a  "painstaking  examina- 
tion," the  court  arrived  at  a  clear  conclusion  that  what  the 
parties  themselves  designate  as  "representations,"  "declara- 
tions, "  or  "  statements  "  cannot  be  converted  into  warranties 
by  being  imported  into,  and  made  part  of,  the  contract. ^ 
In  those  States  where  the  principles  of  equity  are  to  a  con- 
siderable extent  adopted  and  enforced  in  the  courts  of  com- 
mon  law  these  observations  have  a  special  application. 

[§  165  A.  Seaworthiness,  implied  Warranty.  —  The  mere 
fact  of  effecting  marine  insurance  impliedly  warrants  that 
the  vessel  at  the  commencement  of  the  voyage  is  seaworthy, 
i.  e.,  that  its  materials,  construction,  captain  and  crew, 
tackle,  sails,  rigging,  stores,  equipment,  and  outfit  gener- 
ally are  such  in  quantity  and  quality  as  to  render  it  fit  to 
encounter  with  safety  the  ordinary  perils  of  the  proposed* 
voyage  or  service.     The  warranty  extends  to  hidden  defects 

1  The  court  cited  with  approval  the  judicious  observations  of  Mr.  Phillips, 
1  Ins.  §  638  :  "  The  cases  would  have  presented  few  difficulties  of  construction  if 
the  early  jurisprudence  had  been  less  open  to  the  admission  of  forfeitures  of  the 
policy,  and  more  easily  satisfied  with  a  compliance  with  written  stipulations  sub- 
stantially equivalent  to  a  literal  one,  when  such  a  construction  was  not  inconsist- 
ent  with  the  express  provisions  of  the  contract.  The  recent  jurisprudence  tends 
to  greater  liberality  of  construction  in  favor  of  maintaining  the  contract.  Such  a 
rule  may  as  well  be  applied  to  stipulations  and  recitals  in  the  policy  as  to  repre- 
sentations preliminary  and  collateral  to  it ;  and  it  is  more  e(iuitable  after  the 
policy  has  gone  into  effect,  and  the  underwriter  has  a  right  to  retain  the  premium, 
that  the  contract  should  be  continued  in  force  as  long  as  its  being  maintained 
is  consistent  with  its  express  provisions,  and  the  underwriter  is  not  thereby 
prejudiced." 

330 


CH.  VIII.J    WARKANTIEtf. — APPLICATION. — CONSTRUCTION.      [§  166 

as  well  as  those  that  are  known,  and  the  burden  of  proof  is 
on  the  insured.  1  "Seaworthy"  means  fit  to  resist  ordinary 
perils  of  voyage.'^  Payment  of  loss  is  an  admission  of  sea- 
worthiness. ^  Where  a  vessel  puts  back  into  port  by  reason 
of  a  storm  and  insures  without  speaking  of  the  storm,  the 
burden  of  proving  seaworthiness  is  shifted  to  the  assured.^] 

§  166,  Ambiguous  and  Unans-wered  Questions ;  Superfluous 
Answers.  —  Where  the  language  of  the  questions  contained 
in  the  application  is  ambiguous  or  indefinite,  or  calls  for 
answers  which  may  be  to  some  extent  a  matter  of  opinion, 
so  as  to  admit  of  different  answers,  if  the  insured  answer  in 
good  faith  in  some  proper  sense,  and  when  the  application 
is  unintentionally  defective  in  a  matter  known  to  the  in- 
surers or  their  agent,  the  insured  will  be  excused  though  he 
do  not  give  the  desired  answer.^  And  though  the  insured 
do  not  answer  certain  questions  at  all,  and  give  a  negative 
answer  to  a  general  question  as  to  his  knowledge  of  any 
other  circumstances  affecting  the  risk,  such  answer  cannot 
be  made  applicable  to  another  question  in  the  same  applica- 
tion, which  is  unanswered,  but  which  if  negatived  would  be 
untruly  answered;  nor  will  the  failure  to  answer  at  all  viti- 
ate the  policy.  The  issuing  of  a  policy  on  an  application 
which  without  fraud  contains  no  answer  to  certain  questions 
is  a  waiver  of  answer  to  those  questions,  even  though  in 
answer  to  another  question  the  insured  may  have  said  there 
were  "no  other  circumstances  affecting  the  risk;"  and  to 
avoid  the  policy  in  such  cases  the  insurers  must  prove  un- 
true statements  other  than  those  inquired  about.  ^      If  the 

1  [Rogers  i'.  Sun  Mut.  Ins.  Co.,  46  N.  Y,  Super.  65.] 

2  [The  Orient,  16  Fed.  Rep.  916,  5th  Cir.  La.,  1883.] 

3  [Standard  Sugar  Refinery  v.  The  Centennial,  2  Fed.  Rep.  409,  Dist.  of  Mass. 
1880.] 

*  [Batchelder  v.  Ins.  Co.  of  N.  A.,  30  Fed.  Rep.  459  (Pa.),  1887.] 

^  Wilson  V.  Hampden  Fire  Ins.  Co.,  4  R.  I.  159  ;  Campbell  v.  Merchants'  & 

Farmers'  Mut.  Fire  Ins.  Co.,  37  N".  H.  35  ;  Cumberland  Valley  Mut.  Prot.  Co.  v. 

Schell,  29  Pa.  St.  31.     And  see  post,  §§  193,  202,  210,  296  ;  World  ilut.  Life  Ins. 

Co.  V.  Schultz,  73  111.  586  ;  Illinois  Mason's  Soe.  v.  Winthrop,  85  111.  537. 

6  Liberty  Hall  Ass.  v.  Housatonic  Mut.  Fire  Ins.  Co.,  7  Gray  (Mass.),  261  ; 

Newman  v.  Spiingtield,  &c.   Ins.  Co.,  17  Minn.  123 ;  Lorillard  Fire  Ins.  Co.  v. 

McCnlloch,  21   Ohio  St.  176.     In  Haley  v.  Dorchester  Mut.   Fire  Ins.  Co.,  12 

Gray  (Mass.),  545,  the  policy  provided  that  unanswered  questions  should  be  con- 


§  167]  insurance:    fire,   life,   accident,   etc.     ,  [CH.  VIII. 

company  accepts  an  indefinite  or  insufficient  answer,  it  will 
be  construed  liberally  in  favor  of  the  insured;  as  where  a 
question  as  to  how  the  premises  are  occupied  is  answered, 
"dwelling,  &c.,"  this  will  be  held  as  notice  that  a  saloon  is 
kept  there.  1  If  the  answer  be  responsive  and  true  in  part, 
but  irresponsive  and  untrue  in  part,  this  last  will  be  only  a 
representation.  It  must  be  material  in  order  to  avoid  the 
policy.2  If  the  interrogatory  be  modified  by  the  phrase,  "so 
far  as  you  know,"  this  holds  the  interrogated  party  not  to 
answer  absolutely,  but  to  the  best  of  his  knowledge  and 
belief. 3  If  the  answer  be  superfluous  and  immaterial,  it  has 
no  binding  force.  ^  If  a  question  is  not  answered,  there  is 
no  warranty  that  there  is  nothing  to  answer;  and  where 
there  is  but  a  partial  answer,  the  warranty  cannot  be  ex- 
tended beyond  what  is  answered.  Warranty  must  be  based 
upon  the  affirmation  of  something  not  true.  ^ 

§  167.  Application  not  essential.  —  The  recital  in  the  pol- 
icy that  it  is  based  upon  an  application  does  not  make  the 
application  essential.  A  policy  so  stating,  but  issued  with- 
out any  written  application,  is  as  valid  as  if  issued  upon  the 
written  application ;  ^  but  its  references  to  the  application 
have  no  force  or  effect.'^     When  there  is  no  application,  the 

strued  as  if  answered  favorably  to  the  insurers,  on  the  question  of  risk.  Bard- 
well  y.  Conway  Mut.  Fire  Ins.  Co.,  122  Mass.  90;  American  Ins.  Co.  v.  Paul 
(Pa.),  9  Ins.  L.  J.  569,  571;  Bennett  v.  North  British,  &o.  Ins.  Co.  (N.  Y.),  id. 
585  ;' Dayton  Ins.  Co.  v.  Kelly,  24  Ohio  St.  345;  Dohn  v.  Farmers',  &c.  Ins.  Co., 
5  La'ns.  (N.  Y.)  275  ;  Forbes  v.  Edinburgh  Life  Ins.  Co.,  10  Ct.  of  Session  Cas. 
(Scotch)  451.  This  case  holds  that  if  the  failure  to  answer  involves  a  deliberate 
concealment  of  a  fact  known  to  be  material,  it  will  be  fatal  to  the  right  to  re- 
cover.  See  also  Rowe  v.  London,  &c.,  and  Davis  v.  Scottish,  &c.,  cited  in  next 
note ;  post,  §§  176,  198. 

1  Gouinlock  v.  Manuf.  &  Mer.  Mut.  Fire  Ins.  Co.,  43  U.  C.  (Q.  B.)  563  ; 
Rowe  V.  London,  &c.  Ins.  Co.,  12  U.  C.  (Ch.)  311  ;  Davis  v.  Scottish  Prov.  Ins. 
Co.,  16  U.  C.  (C.  P.)  176. 

3  Buell  V.  Conn.  Mut.  Life  Ins.  Co.,  C.  Ct.  (Ohio)  5  Ins.  L.  J.  274  ;  post,  §  170. 

3  iEtna  Ins.  Co.  v.  Grube,  6  Minn.  82  ;  Cheever  v.  Union,  &c.  Life  Ins.  Co. 
(Superior  Court,  Cincinnati),  5  Ins.  L.  J.  159. 

*  Buell  V.  Conn.  Mut.  Life  Ins.  Co.,  C.  Ct.  (Ohio);  5  Big.  Life  &  Ace.  Ins. 
Cas.  473. 

6  Dilleber  v.  Home  Life  Ins.  Co.,  69  N.  Y.  256. 

6  Blake  o.  Exch.  Mut.  Ins.  Co.,  12  Gray  (Mass.),  265. 

7  Newman  v.  Springfield  Fire  &  Mar.  Ins.  Co.,  17  Minn.  123  ;  Commonwealth 
V.  Hide  &  Leather  Ins.  Co.,  112  Mass.  136. 

332 


CH.  VIII.]    WARRANTIES.— APPLICATION.— CONSTRUCTION.     [§168 

insured  is  bound  by  the  conditions  of  the  policy  which  he 
accepts  and  holds  without  objection.  That  he  never  read  it 
is  not  the  fault  of  the  insurers.  ^ 

§  168.  Application  may  limit  and  control  the  Language  of 
the  Policy.  2  — If  the  policy  provides  that  if  any  statement 
contained  in  the  declaration  (which  is  made  part  thereof)  be 
untrue,  the  policy  shall  be  void,  and  the  declaration  itself 
proceeds  to  say  that  the  particulars  "are  correct  and  true 
throughout,"  and  if  it  shall  hereafter  appear  that  "any 
fraudulent  concealment  or  designedly  untrue  statement  be 
contained  therein,"  i.  e.  in  the  above-written  particulars,  the 
policy  shall  be  void,  — not  every  untrue  statement,  but  only 
a  designedly  untrue  statement  will  avoid  the  policy.  The 
two  clauses,  parts  of  the  same  instrument,  must  be  taken 
together,  and  if  any  doubt  arises  as  to  their  construction, 
that  doubt  must  be  construed  against  the  insurers  who  pre- 
pared the  instrument.^ 

1  Swan  V.  Watertown  Fire  Ins.  Co.  (Pa.),  10  Ins.  L.  J.  392. 

2  [See§  161.] 

8  Fowkes  V.  Manchester  &  London  Life  Ass.  &  Loan  Assoc.,  3  B.  &  S.  (Q.  B.) 
917.  "The  declaration,"  says  Cock  burn,  C.  J.,  in  his  opinion,  "is  'that  the 
particulars  given  in  answer  to  the  question  propounded  by  the  company  are  cor- 
rect and  true  throughout ; '  that  the  proposal  and  declaration  shall  be  the  basis 
of  the  contract.  '  And  if  it  shall  hereafter  appear  that  any  fraudulent  conceal- 
ment or  designedly  untrue  statement  be  contained  therein,  then  all  the  moneys 
which  shall  have  been  paid  on  account  of  the  assurance  made  in  consequence 
hereof  shall  be  forfeited,  and  the  policy  granted  in  respect  of  such  assurance  shall 
be  absolutely  null  and  void.'  It  is  sought,  on  the  part  of  the  defendants,  to  con- 
strue this  declaration  in  the  disjunctive,  so  that  not  only  if  any  fraudulent  con- 
cealment or  designedly  untrue  statement  is  contained  in  the  answers  to  the 
question  the  policy  is  to  be  void  and  the  premiums  forfeited,  but  that  if  any 
incorrect  or  untrue  statement,  however  honestly  and  sincerely  made  in  the  belief 
of  its  truth,  occur  in  those  answers,  the  same  consequences  are  to  follow.  The 
first  observation  in  answer  is  that,  upon  that  construction,  the  clause  which 
relates  to  fraudulent  concealment,  and  designedly  untrue  statement,  is  super- 
fluous and  unnecessary,  because  it  is  only  a  reiteration  in  cxtenso  of  that  which 
is  involved  in  the  former  clause,  which  requires  the  particulars  to  be  correct  and 
true.  In  construing  an  instrument  prepared  by  the  company,  and  submitted  by 
thein  to  the  party  effecting  the  insurance  for  his  signature,  it  ought  to  be  read 
most  strongly  contra  proferentes;  and  inasmuch  as,  upon  the  construction  con- 
tended for,  the  latter  clause  is  wholly  unnecessar)',  I  think  we  ought  to  construe 
that  clause  as  merely  explanatory  of  what  is  meant  by  '  correct '  and  '  true '  in  the 
former  clause.  A  layman  about  to  effect  an  insurance  would  read  such  a  docu- 
ment, when  submitted  to  him  for  his  signature,  in  the  following  sense:  'I  agree 
that  my  answers  to  the  questions  propounded  to  me  by  the  company  shall  be  the 

333 


§  169]  INSURANCE  :    FIRE,   LIFE,  ACCIDENT,   ETC.         [CH.  VIII. 

S  169.  Limitation  of  Policy  by  Application  (continuedy  — 
In  further  illustration  of  this  point  may  be  cited  the  case  of 
Washington  Life   Insurance   Company  v.  Haney,^  where  it 


■basis  of  the  contract  between  us ;  that  is  to  say,  if  I  am  guilty  of  any  fraudulent 
concealment,  or  designedly  untrue  statement  in  those  answers,  the  policy  shall  be 
null  and  void,  and  not  only  that,  but  the  premiums  shall  be  forfeited.'  Then  it 
is  said  that  if  we  turn  from  the  declaration  to  the  policy,  we  shall  find  that  the 
language  of  the  policy  varies  from  the  declaration  ;  and  it  is  argued  that  the 
policy  is  the  true  statement  of  the  contract  between  the  parties.  But  the  decla- 
ration is  declared  to  be  as  much  a  part  of  the  policy  as  if  it  had  been  set  forth 
therein;  and  the  language  of  the  policy  is,  that  if  any  statement  in  the  declara- 
tion is  '  untrue,'  the  policy  shall  be  void,  and  all  moneys  paid  in  respect  thereof 
be  forfeited.  To  ascertain  the  meaning  of  the  words,  'if  any  statement  in  the 
declaration  is  untrue,'  we  must  refer  to  the  declaration  itself,  which  is  made  the 
basis  of  the  contract ;  and  reading  those  words  with  the  light  thrown  upon  them 
by  the  language  in  the  declaration,  I  think  the  true  construction  of  the  language 
of  the  defendants  is,  that,  in  order  to  avoid  the  policy,  the  statement  must  be 
designedly  untrue;  that  is,  untrue  to  the  knowledge  of  the  assured."  See  also 
Sinclair  o.  Phoenix,  &c.  Ins.  Co.,  C.  Ct.  (Minn.),  9  Ins.  L.  J.  523. 

1  10  Kansas,  525.  The  opinion  of  the  court  upon  this  point  was  as  follows: 
"The  policy  was  issued  and  accepted  by  the  assured  upon  the  following  amongst 
other  express  conditions  and  agreements,  to  wit,  '  If  any  of  the  statements  or 
declarations  made  in  the  application  for  this  policy,  upon  the  faith  of  which  this 
policy  is  issued,  shall  be  found  in  any  respect  untrue.'  .  .  .  'Then  in  every 
such  case  the  said  company  shall  not  be  liable  for  the  payment  of  the  sum 
insured,  or  any  part  thereof,  and  this  policy  shall  be  null  and  void.'  "We  do  not 
understand  the  clause,  '  upon  the  faith  of  which  this  policy  is  issued,'  as  limiting 
this  condition  to  a  portion  of  the  application,  or  any  particular  statements 
therein.  It  does  not  mean  to  imply  that  there  are  certain  statements  which 
must  be  true  because  the  policy  is  based  upon  them,  while  others  are  immaterial. 
It  means  that  the  policy  is  issued  upon  the  faith  of  the  whole  application,  with 
all  its  statements  and  declarations,  and  that  if  any  of  them  are  untrue  the  policy 
is  avoided.  We  must  therefore  consider  the  application  as  a  whole,  and  each 
party  has  a  right  to  have  it  so  considered.  If  the  application  propounds  certain 
questions  and  indicates  in  what  manner  they  must  be  answered,  it  is  enough  that 
they  are  answered  in  that  manner,  and  when  the  policy  is  based  upon  the  state- 
ments and  declarations  of  the  application,  it  is  based  upon  them  made  in  the 
manner  and  under  the  rules  laid  down  by  the  company  in  the  application.  If 
we  turn  now  to  the  application  we  find  under  the  head  '  Instructions  in  filling  up 
this  application,'  '  First,  answer  each  of  the  questions  on  the  first  page  to  the 
best  of  your  knowledge  and  belief,  briefly  but  explicitly;'  and  at  the  close  of  the 
questions  and  answers  of  the  applicant,  and  just  before  her  signature,  is  the  fol- 
lowing: 'It  is  hereby  declared  that  the  above  are  fair  and  true  answers  to  the 
foregoing  questions,  and  it  is  acknowledged  and  agreed  by  the  undersigned  that 
the  above  statements  shall  form  the  basis  of  the  contract  for  insurance,  and  also 
that  any  wilfully  untrue  or  fraudulent  answers,  any  suppression  of  facts  in  regard 
to  the  party's  health,  or  neglect  to  pay  the  premium  on  or  before  the  day  it 
becomes  due,  will  render  the  policy  null  and  void,  and  forfeit  all  payments  made 
thereon.'    While  the  policy  for  its  validity  requires  truthfulness  in  the  statements 

334 


CH.  VIII.]    WARRANTIES. — APPLICATION.— CONSTRUCTION,      [^  170 

was  held  to  be  a  presumption  of  law  that  an  insurance  pol- 
icy is  based  upon  the  application.  The  two  papers  must  be 
construed  together.  And  the  use  of  a  word,  "residence," 
for  instance,  in  the  application,  referring  clearly  to  a  per- 
manent abode,  will  not  be  held  elsewhere  in  the  policy  to 
mean  a  temporary  sojourn.^  [When  an  order  showed  the 
"intention  of  the  plaintiffs  to  have  been  to  insure  ".  goods  in 
a  different  way  from  that  which  the  terms  of  the  policy 
would  imply,  it  has  been  held  that  it  "controlled  and  ex- 
plained the  expressions  of  the  formal  policy,"  and  that  the 
mistake  of  the  clerk  therein  should  be  rectified  according 
thereto.  ^] 

§  170.  No  Implied  Warranty  as  to  Matter  immaterial  to  the 
Risk.  — While  it  is  true  that  if  a  fact  be  in  plain  terms 
expressly  warranted,  its  materiality  to  the  risk  is  of  no  im- 
portance, and  it  becomes  a  condition  precedent,  although 
entirely  immaterial ;  yet  where  a  circumstance  is  sought  to 
be  included  by  implication  in  the  warranty,  it  is  not  to  be 
supposed  that  the  parties  intended  to  include  it,  unless  it  be 
manifestly  material  to  the  risk.^  In  this  way  the  question 
of  materiality  may  sometimes  arise,  even  under  a  warranty, 
or  rather  as  aiding  in  determining  the  question  whether 
what  appears  to  be,  and  in  point  of  form  is,  a  warranty,  is 
so  in  point  of  fact.  Thus  in  Anderson  v.  Fitzgerald,*  where 
the  policy  was  to  be  void  "  if  any  false  statement  in  or  about 
the  effecting  or  obtaining  that  insurance  "  were  made,  it  was 
said  by  Parke,  B.  :  "It  is  true  that  the  materiality  of  these 
statements  may  be  sometimes  evidence  of  the  purpose  with 
which  they  were  made,  and  may  tend  to  show  that  they  were 

of  the  application,  it  is  enough  if  they  are  true  according  to  the  degree  and  con- 
ditions of  truthfulness  required  by  the  application.  This  is  all  the  parties  want 
when  they  speak  of  truthfulness  in  the  policy;  to  presume  otherwise,  and  sup- 
pose that  the  company  meant  one  degree  of  truthfulness  in  the  application,  and 
another  in  the  policy,  is  to  impute  a  dishonesty  which  the  law  will  never  pre- 
sume, and,  if  shown  to  exist,  will  never  sustain." 

1  Mobile  Life  Ins.  Co.  v.  Walker,  58  Ala.  290. 

2  [N"orris  v.  Ins.  Co.  of  North  America,  3  Yeates  (Pa.),  84,  91  ] 

»  O'Niel  V.  Buffalo  Fire  Ins.  Co.,  3  Conist.  (KY.)  122;  Swick  v.  Home  Life 
Ins.  Co.,  2  Dill.  C.  Ct.  (Mo.)  160;  Appleton  Iron  Co.  v.  British  Am.  Ass,  Co., 
46  Wis.  23. 

*  4  H.  of  L.  Cas.  484. 

335 


§  170]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.         [CH.  VIII. 

made  with  the  object  of  obtaining  the  policy,  because  if  im- 
material they  would  not  be  likely  to  effect  it;  but  the  mate- 
riality is  not  a  necessary  condition  to  bring  them  within  the 
scope  of  the  proviso,  if  it  be  shown  that  the  statements  were 
made  in  obtaining  the  policy  and  for  the  purpose  of  effecting 
it."  A  warranty  will  in  no  case  be  extended  by  construc- 
tion, nor  will  it  be  made  to  include  anything  not  clearly 
within  its  terms.  ^  And  it  will  be  construed  strictly  against 
those  for  whose  benefit  it  is  made,  when  it  imposes  burdens 
upon  others; 2  and  so,  if  possible,  as  to  avoid  a  forfeiture.^ 
When,  however,  the  truth  of  all  the  statements  in  the  appli- 
cation is  made  a  condition  precedent,  the  reciting  a  portion 
of  them  only  in  the  policy  will  not  have  the  effect  to  reduce 
those  not  recited  from  the  quality  of  warranties  to  that  of 
representations.*  And  where  a  policy  insures  the  holder 
against  death  or  injury  by  'violent  and  accidental  means 
within  the  meaning  of  this  contract  and  conditions,'  and 
the  conditions  annexed  specify  certain  modes  of  injury  or 
death  which  the  policy  did  not  cover,  this  exclusion  does 
not  operate  to  enlarge  the  scope  of  the  words  "violent  and 
accidental  means,"  so  as  to  include  all  modes  of  injury  and 
death  by  violence  and  accident  not  embraced  in  the  exclu- 

1  Blood  V.  Howard  Fire  Ins.  Co.,  12  Cush.  (Mass.)  472:  Shepherd  v.  Union 
Mut.  Fire  Ins.  Co.,  38  N.  H.  232  ;  Rann  v.  Home  Ins.  Co.,  59  N.  Y.  387. 

2  Catlin  V.  Springfield  Fire  Ins.  Co.,  1  Sum.  (U.  S.  C.  C.)  434. 

3  Ripley  v.  iEtna  Ins.  Co.,  29  Barb.  (N.  Y.)  552.  [The  courts  will  save  a 
forfeiture  if  possible  fairly  to  do  so,  and  if  dividends  were  earned  by  the  company 
before  default  and  are  applicable  to  the  policy,  equity  will  compel  their  applica- 
tion to  satisfy  premium  notes.  Franklin  Life  Ins.  Co.  r.  Wallace,  93  Ind.,  7. 
Every  condition  to  defeat  any  interest  must  be  construed  strictly  against  its 
maker.  Lawe  v.  Hyde,  39  Wis.  345,  360.  And  will  not  be  .enforced  unless 
there  is  the  clearest  evidence  that  this  is  the  meaning  of  the  contract.  Schunck 
V.  Gegenseitiger  Witten  und  Waisen  Fond,  44  Wis.  369,  372  ;  Livingston  v. 
Stickles,  7  Hill,  253,  256  ;  Carson  v.  Jersey  City  Ins.  Co.,  43  N.  J.  300  ;  Bonen- 
faut  V.  Insurance  Co.,  76  Mich.  653.  Only  when  no  other  construction  is  permis- 
sible by  the  language,  will  a  forfeiture  result.  Darrow  v.  F.  F.  Soc,  116  N.  Y. 
537.  An  especial  strictness  against  the  company  will  be  observed  in  construing 
clauses  which  restrict  its  liability,  excuse  payment  of  a  bona  fide  loss,  or  M^ork 
any  forfeiture.  Germania  Fire  Ins.  Co.  v.  Frazier,  22  Brad.  327.  A  forfeiture 
because  a  member  neglects  his  Easter  duties  will  be  very  carefully  scrutinized 
and  rejected  if  possible.  Matt  v.  Roman  Catholic  Mut.  Prot.  Soc,  70  Iowa, 
455.] 

*  Sceales  v.  Scanlan,  6  Irish  (Law),  367,  by  a  divided  opinion. 

336 


CII.  VIII.]   WARRANTIES.— APPLICATION.— CONSTRUCTION.      [§  171 

sion,  or  any  modes  not  fairly  within  the  meaning  of  the 
words.  1  But  statements  and  stipulations  not  required  by 
the  conditions  of  the  contract,  though  the  writing  contain- 
ing them  is  by  the  conditions  made  part  of  the  policy,  do 
not  constitute  warranties.  They  are  not  necessary,  but  vol- 
untary statements  and  stipulations,  and  if  material  have  the 
force  of  representations. 2 

§  171.  "Warranties  and  Representations  construed  strictly  as 
to  their  Scope.  —  Warranties  and  representations  will  also 
be  construed  strictly  as  to  their  scope.  Thus  a  warranty 
that  a  room  is  warmed  by  a  stove,  and  that  the  pipe  is  well 
secured,  is  only  a  warranty  that  it  is  so  warmed  when 
warmed  at  all,  and  that  the  pipe  is  so  secured  when  the 
stove  is  used,  but  not  at  other  times. ^  So  a  warranty  that 
the  water-tanks  shall  be  at  all  times  well  supplied  with 
water,  as  applicable  to  a  building  in  process  of  construction, 
means  that  the  tanks  shall  be  built  and  filled  with  reason- 
able diligence  in  the  course  of  construction.^  So  a  war- 
ranty of  force-pumps,  ready  for  use,  includes  a  warranty 
that  there  is  some  power  to  work  the  pumps ;  but  it  is  not 
a  warranty  that  that  power  is  the  best,  or  the  usual,  or  of 
any  particular  kind;  nor  that  the  pumps  shall  not  be  dis- 
abled by  the  fire,  or  shall  always  be  in  order. ^  And  a 
representation  that  there  is  a  force-pump  does  not  by  impli- 
cation include  hose.  The  truth  of  the  representation  is 
completely  established  by  the  fact  that  there  is  a  force- 
pump,  and  whether  hose  or  buckets  are  the  means  by  which 
the  water  delivered  by  the  pump  is  made  available  in  case 
of  fire,  not  being  inquired  about,  is  immaterial.^  So  a  war- 
ranty that  the  property  belongs  to  the  insured  is  not  a  war- 
ranty of  any  particular  title,  or  that  it  is  unincumbered.^ 

1  Southard  v.  Railway  Passengers'  Assurance  Co.,  34  Conn.  574. 

2  Protection  Ins.  Co.  v.  Harmer,  2  Ohio  St.  452 ;  ajite,  §  166. 
8  Loud  V.  Citizens'  Mut.  Ins.  Co.,  2  Gray  (Mass.),  221. 

*  Gloucester  Manuf.  Co.  v.  Howard  Fire  Ins.  Co.,  5  Gray  (Mass.),  497. 

5  Sayles  v.  North-Western  Ins.  Co.,  2  Curtis  C.  Ct.  (Mass.)  612  ;  Albion  Lead 
Works  V.  Williamsburg,  &c.  Ins.  Co.,  C.  Ct.  (Mass.),  2  Fed.  Rep.  479. 

6  Peoria  Mar.  &  Fire  Ins.  Co.   v.  Lewis,  18  111.   553  ;  Gilliat  v.  Pawtucket 
Mut.  Fire  Ins.  Co. ,  8  R.  I.  282.     And  see  post,  §§  198,  199. 

7  Mut.  Ins.  Co.  V.  Deale,  18  Md.  26  ;  post,  §§  174-176. 

VOL.  I.  — 22  337 


§172]  insurance:    FIRE,   LIFE,    ACCIDENT,   ETC.  [CH.  YIII. 

§  172.     Contracts  of  Insurance  interpreted  by  the  same  Rules 
as  other  Contracts.  —  It  maj  be  well  to  observe  here,  because 
there  are  unconsidered  suggestions  to  the  contrary,  that  the 
principles  of  interpretation  applicable  to  contracts  of  insur- 
ance are  the  same  as  those  which  obtain  in  the  case  of  other 
contracts.     It  is  likewise  to  be  observed,  that  while  marine 
insurance  was  the  earliest,  and,  till  within  a  comparatively 
recent  period,  the  almost  exclusive  form  under  which  this 
contract  came  under  the  observation  of  the  courts,  and  upon 
this   form   is   based   substantially    that  body    of   principles 
known  as  the  Law  of  Insurance,  all  the  other  forms  of  in- 
surance are  the   outgrowth  of   this  earliest  and   primitive 
form,  and  are  but  new  adaptations  and  applications  thence 
elaborated,  subject  only  to  such  modifications  as  were  re- 
quired by  the  peculiarities  of  the  new  risks  assumed,   and 
the  new  interests  to  be  protected.     The  doctrines  of  marine 
insurance  are  therefore  always  to  be  resorted  to  and  applied 
in  the  elucidation  of  all  other  kinds,  unless  the  express  pro- 
visions of   the   contract,    or   circumstances   peculiar  to  the 
subject-matter,   render  them  inapplicable,    or  require  their 
qualification  in  order  to  accomplish  the  object  for  which  the 
contract  is  entered  into.     When  it  is  said  that  a  contract  of 
insurance  is  a  contract  uberrimcs  fidei,  this  only  means  that 
the  good  faith,  which  is  the  basis  of  all  contracts,  is  more 
especially  required  in  that  species  of  contract  in  which  one 
of  the  parties  is  necessarily  less  acquainted  with  the  details 
of  the  subject  of  the  contract  than  the  other,  i     Its  language, 
says  Nelson,  C.  J.,^  "is  to  receive  a  reasonable  interpreta- 
tion ;  its  intent  and  substance,  as  derived  from  the  language 
used,  should   be  regarded.      There   is  no  more  reason  for 
claiming  a  strict  literal  compliance  with  its  terms  than  in 
ordinary  contracts.     Full  legal  effect  should  always  be  given 
to  it  for  the  purpose  of  guarding  the  company  against  fraud 
and  imposture.     Beyond  this,  we  would  be  sacrificing  sub- 

1  Lord  Abinger,  C.  B.,  in  Corafoot  v.  Fowke,  6  Mees.  &  Wels.  358,  in  reply  to 
the  suggestion  of  Sir  Frederic  Tbesiger,  arguendo,  on  a  question  of  representa- 
tion that  a  greater  degree  of  good  faith  is  required  in  contracts  of  insurance 
than  in  others. 

2  Turlev  v.  North  Am.  Fire  Ins.  Co.,  25  Wend.  374. 

338 


CH.  Vni]  WAERANTIES.— APPLICATION. — CONSTEUCTIOX.   [§  172  A 

stance  to  form, — following  words  rather  than  ideas."  In- 
deed, a  moment's  reflection  will  render  it  apparent  that 
there  is  nothing  in  an  agreement  about  insurance  intrinsi- 
cally more  sacred  or  inviolable  than  in  an  agreement  about 
any  other  subject-matter.  It  differs  only  from  others  in  the 
fact  that,  from  the  nature  of  the  contract  of  insurance  and 
the  relations  of  the  parties,  occasions  therein  more  fre. 
quently  arise  where  the  rights  of  the  respective  parties  de- 
pend upon  the  exercise  of  good  faith.  And  while  the  older 
cases  had  oftener  to  deal  with  the  want  of  good  faith  on  the 
part  of  the  insured,  the  modern  ones  are  full  of  examples 
where  the  courts  have  been  compelled  to  a  liberal  applica- 
tion of  the  doctrines  of  waiver  and  estoppel  to  protect  the 
insured  against  defences  founded  on  a  want  of  good  faith  on 
the  part  of  the  insurer.^ 

[§  172  A.  Construction  in  General.  —  Contracts  of  insur- 
ance are  to  be  construed  accurately  and  neither  liberally  nor 
severely,  but  without  favor  to  either  party,^  to  arrive  at  the 
true  intent  of  the  parties,  elucidating  each  part  of  the  in- 
strument by  every  other  part.  In  construing  a  policy  the 
court  should  give  it  a  fair  and  liberal  interpretation,  such 
as,  under  all  the  circumstances  of  the  case,  appears  most 
consonant  to  the  intention  of  the  parties  at  the  time  the 
contract  was  made.^  The  understanding  of  one  of  the  par- 
ties, alone,  cannot  determine  the  meaning  of  the  contract* 
Conversations  between  the  parties  at  the  time  of  making  a 
contract,  are  competent  evidence  to  show  the  meaning  in- 
tended to  be  applied  to  a  certain  ambiguous  term  therein.^ 
Contemporaneous  insurance  literature,  and  all  surrounding 
circumstances,  will  be  considered  in  determining  what  the 


1  And  see  post,  §§  209-212,  296. 

2  [Merchants'  Ins.  Co.  v.  Davenport,  17  Grat.  138,  145.] 

3  [Riftgin  V.  Patapsco  Ins.  Co.,  7  H.  &  J.  (Md.)  279,  287  ;  Mauger  v.  Holyoke 
Mut.  Fire  Ins.  Co.,  1  Holmes  (U.  S.),  287,  289.  Facts  and  circumstances 
existing  when  the  insurance  was  effected,  but  not  stated  in  the  policy,  may  be 
shown  to  prove  the  intention  of  the  parties  in  this  case  as  to  the  goods  covered 
by  the  policy.] 

■1  [Montgomery  v.  Firemen's  Ins.  Co.,  16  B.  Mon.  (Ky.)  427,  441.] 
5  [Gray  v.  Harper,  1  Story  (U.  S.),  574,  588.] 

339 


§  172  A]  INSURANCE :    FIRE,   LIFE,   ACCIDENT,   ETC.       [CH.  VIIL 

parties  intended  by  the  "reserve  dividend  plan."  ^  If  in  the 
general  form  of  policies  there  are  conditions  not  applicable 
to  the  particular  risk,  they  will  be  ignored.  When  the  rea- 
son of  a  condition  in  the  general  printed  form  does  not  exist 
in  a  specific  case,  the  condition  becomes  meaningless  and 
inoperative. 2  A  clause  of  exception  governs  the  general 
clause  to  which  it  applies.^  When  the  words  of  a  promise 
are  doubtful  they  are  to  be  construed  in  the  sense  in  which 
the  promisor  knew  or  thought  the  promisee  would  under- 
stand them.^  And  if  the  intention  of  the  parties  is  doubt- 
ful, the  construction  is  to  be  in  favor  of  the  promisee.^  In 
an  action  on  a  policy  which  said  "East  India  Islands,"  parol 
evidence  was  admitted  to  show  that  the  locality,  though 
geographically  not  one  of  these,  was  nevertheless  so  con- 
sidered by  common  repute.^  And  the  same  has  been  held 
as  to  a  part  of  the  Baltic  Sea.'^  Proof  of  the  course  of  busi- 
ness and  dealings  between  the  parties  is  admissible  when 
the  policy  is  ambiguous.^  In  an  action  on  a  policy  of  in- 
surance on  a  ship,  with  the  words  "lost  or  not  lost,"  and 
with  the  subsequent  warranty  in  the  policy  by  the  plaintiff, 
"Well  on  Dec.  9,  1874,"  where  it  appeared  that  the  pol- 
icy was  signed  at  3  p.m.  on  the  day  mentioned,  and  that  the 
ship  was  lost  at  8  a. m.  of  the  same  day,  it  was  held  that  the 
defendants  were  liable,  as  the  warranty  covered  no  especial 
part  of  the  day.^  The  clause  "lost  or  not  lost"  covered  all 
days  prior  to  Dec.  9,  while  the  warranty  was  satisfied  if  on 
any  part  of  Dec.  9th  the  ship  was  safe.  It  was  not  a  war- 
ranty that  the  vessel  was  safe  at  the  moment  the  policy  was 
subscribed,  but  only  on  that  day,  and  as  parts  of  a  day  will 
not  be  reckoned,  safety  during  the  first  hours  of  the  day  is 

1  [Fuller  V.  Metropolitan  Life  Ins.  Co.,  37  Fed.  Kep.  163  (N.  Y.),  1889.] 

2  [Grandin  v.  Insurance  Co.,  107  Pa.  St.  26.] 

3  [Mitchell,  &c.  Co.  v.  Imperial  Fire  Ins.  Co.,  17  Mo.  App.  627.] 
<  [Barlow  v.  Scott,  24  N.  Y.  40,  44.] 

5  [JIarvin  v.  Stone,  2  Cowen,  761,   806  (covenant)  ;  Doe  v.  Dixon,   9  East, 
15,  16  (grant).] 

6  [Robertson  v.  Money,  Ry.  &  Mood.  75,  77.] 
^  [Uhde  V.  Walters,  3  Campb.  16.] 

»  [Fabbri  v.  Phcenix  Ins.  Co.,  55  N.  Y.  129,  133.] 
9  [Blackhurst  v.  Cockrell,  3  T.  R.  360.] 
340 


en.  VIII.]    WAEKANTIES. — APPLICATION. — CONSTRUCTION.      [§  173 

sufificient.  Construction  unless  there  be  ambiguity  is  for 
the  court  alone. ^  The  question  whether  a  word  is  "six"  or 
"  oix  "  in  a  description  of  premises,  is  for  the  court,  not  the 
jury.  2  Inspection  showed  clearly  that  the  word  was  six. 
When  the  subjects  of  insurance  are  separately  stated  and 
separately  insured,  though  in  the  same  policy,  a  false  war- 
ranty as  to  one  docs  not  avoid  the  policy  as  to  the  other. ^] 

§  173.  How  far  Proof  of  Usage  is  admissible  in  Aid  of  In- 
terpretation.*—  In  the  early  history  of  insurance  many  terms 
and  phrases  were  used  of  doubtful  meaning  which  required 
a  reference  to  usage  for  the  purpose  of  explanation.  And 
so  numerous  were  these  doubtful  terms  and  phrases,  and  so 
frequent  was  the  reference  to  custom  and  usage  to  explain 
them,  that  so  great  a  judge  as  Mr.  Justice  Buller  is  reported 
to  have  said  that  "in  policies  of  insurance  in  particular  a 
great  latitude  of  construction  as  to  usage  has  been  admitted. 
By  usage  places  come  within  the  policy  which  are  not  ex- 
pressed in  words.  Usage  not  only  explains  but  even  con- 
trols the  policy."^  "In  all  matters  of  trade,  usage  is  a 
sacred  thing."  ^  But  if  that  learned  judge  meant  anything 
more  by  these  expressions  than  that  great  frequency  of  re- 
sort to  usage  for  the  purpose  of  explaining  ambiguities  is 
had,  he  was  doubtless,  by  some  peculiarity  of  the  cases  under 
consideration,  betrayed  into  unguarded  expressions,  not  apt 
to  fall  from  him,  and  not  warranted  either  by  the  earlier  or 
later  decisions.  Nevertheless,  the  authority  of  so  great  a 
man  gave  vogue  to  the  impression  that  in  this  respect  con- 
tracts of  insurance  were  in  some  sort  excepted  out  of  the 
general  rules  applicable  to  other  contracts.  But  nothing  is 
better  settled  than  that  this  impression  is  without  founda- 
tion. The  same  rule  of  construction  which  applies  to  other 
instruments  applies  also  to  these.     They  are  to  be  construed 

1  [Hutchison  v.  Bowker,  5  M.  &  W.  535,  540.] 

2  [Lapeer  Ins.  Co.  v.  Doyle,  30  Mich.  150,  160.] 

3  [Holmes  v.  Drew,  16  Hun,  491,  492  ;  Koontz  v.  Hannibal  Ins.  Co.,  42 
Mo.  126,  131.] 

*  [See  §§  179,  180.] 

^  Long  V.  Allen,  cited  in  Park,  390. 

6  Newman  v.  Cazalet,  also  cited  in  Park,  414,  note. 

341 


§  174]  INSUKANCE:   FIRE,   LIFE,   ACCIDENT,    ETC.         [CH.  VIII. 

according  to  the  sense  and  meaning  of  the  terms  used ;  and 
if  these  are  clear  and  unambiguous,  the  courts  will  not  ad' 
mit  parol  evidence  to  contradict,  vary,  or  explain  them. 
Their  terms  are  to  be  understood  in  their  plain,  ordinary, 
and  popular  sense,  unless  they  have  generally,  in  respect  to 
the  subject-matter,  as  by  the  knovs^n  usage  of  trade  or  the 
like,  acquired  a  peculiar  sense,  distinct  from  the  popular 
sense,  rendering  it  necessary  to  resort  to  extrinsic  proof 
in  order  to  determine  in  which  sense  they  are  used,  and 
so  to  explain  their  ambiguity,  or  unless  the  context  evi- 
dently points  out  that  they  must,  in  the  particular  in- 
stance, and  in  order  to  effectuate  the  immediate  intention 
of  the  parties,  be  understood  in  some  special  and  peculiar 
sense.^ 

§  174.  The  Contract  -will  be  construed  liberally  in  Favor  of 
the  Object  to  be  accomplished.  —  It  was  early  held,  with 
special  reference  to  contracts  of  marine  insurance,  that  the 
strietum  jus  or  a/pex  juris  is  not  to  be  laid  hold  on,  but  they 
are  to  be  construed  largely  for  the  benefit  of  trade  and  for 
the  insured,^  —  a  rule  which,  under  different  forms  of  ex- 
pression, has  obtained  with  reference  to  all  kinds  of  insur- 
ance to  the  present  day.  Having  indemnity  for  its  object, 
the  contract  is  to  be  construed  liberally  to  that  end,  and  it 
is  presumably  the  intention  of  the  insurer  that  the  insured 
shall  understand  that  in  case  of  loss  he  is  to  be  protected 
to  the  full  extent  which  any  fair  interpretation  will  give.^ 
The  spirit  of  the  rule  is,  that  where  two  interpretations 
equally  fair  may  be  given,  that  which  gives  the  greater  in- 
demnity shall  prevail.  And  to  the  same  spirit  is  due  the 
rule  that  conditions  and  provisos  will  be  strictly  construed 
against  the  insurers  because  they  have  for  their  object  to 
limit  the  scope  and  defeat  the  purpose  of  the  principal  con- 
tract ;  *  and  apparently  contradictory  clauses  will  be  so  con- 

1  Per  Lord  Ellenborough,  Robertson  v.  French,  4  East,  130,  135.  And  see 
post,  §  179. 

2  Tierney  v.  Etherington,  cited  1  Burr.  348  ;  see  §  175. 

3  Dow  V.  Hope  Ins.  Co.,  1  Hall  (N.  Y.  Superior  Ct.),  166,  174  ;  post,  §§  330, 
440. 

4  Hoffman  v.  Mtna,  Ins.  Co.,  32  N.  Y.  405. 

342 


OIL  VIII.]    WAEEANTIES. — APPLICATION. — CONSTRUCTION.      [§  175 

strued  if  possible  as  to  reconcile  them  with  each  other,  and 
to  give  to  each  its  due  force  in  furtherance  of  the  main  pur- 
pose of  the  contract.^  Of  course  the  different  provisions  of 
the  contract  must  be  so  construed,  if  possible^  as  to  give 
effect  to  each.  If,  therefore,  the  natural  and  obvious  inter- 
pretation of  one  would  render  it  nugatory,  or  bring  it  into 
conflict  with  another,  while  a  different  interpretation  would 
reconcile  the  two,  and  give  force  and  effect  to  both,  the  lat- 
ter is  to  be  adopted.  So  if  the  natural  interpretation,  look- 
ing to  the  other  provisions  of  the  contract,  and  to  its  general 
object  and  scope,  would  lead  to  an  absurd  or  unreasonable 
conclusion,  as  such  a  result  cannot  be  presumed  to  have  been 
within  the' intention  of  the  parties,  such  interpretation  must 
be  abandoned,  and  that  adopted  which  will  be  more  consis- 
tent with  reason  and  probability. ^  And  so  the  acts  of  the 
insurer  will  be  so  interpreted  as  to  give  form  and  effect  to 
the  policy,  rather  than  the  contrary;  as  where  the  insurers 
issue  an  open  policy  with  blanks  for  indorsement  of  addi« 
tional  insurance,  and  receipts  to  be  signed  by  the  agent,  the 
indorsements  made  and  agreed  on  by  the  agent  will  be  held 
valid,  though  the  insurer  did  not  intend  he  should  complete 
a  contract  without  reference  to  them,  and  though  the  policy 
provided  for  such  "risks  as  may  be  agreed  on,  as  per  in- 
dorsement hereon,  accepted  by  the  company. "  ^  The  same 
rule  will  apply  where,  by  its  by-laws,  the  insurers  have  con- 
strued a  provision  of  their  charter.  Though  it  may  be  erro- 
neous, if  acted  upon  by  others,  as  against  them  the  insurers 
cannot  be  allowed  to  question  its  correctness.^ 

§  175.  Language  taken  most  strongly  against  those  for  -whose 
Benefit  it  is.  —  No  rule,  in  the  interpretation  of  a  policy,  is 
more  fully  established,  or  more  imperative  and  controlling, 
than  that  which  declares  that,  in  all  cases,  it  must  be  liber- 
ally construed  in  favor  of  the  insured,  so  as  not  to  defeat 
without  a  plain  necessity  his  claim  to  the  indemnity,  which, 

1  Merchants'  Ins.  Co.  v.  Edmond,  17  Grat.  (Va.j  138. 

*  See  also  post,  §  247. 

*  Wass  V.  Maine  Mut.  Ins.  Co.,  61  Me.  537. 

*  Kentucky  Mut.  Life  Ins.  Co.  v,  Calvert  (Ky.),  9  Ins.  L.  J.  529. 

343 


§175]         insurance:   fire,  life,  accident,  etc,       [ch.  viii. 

in  making  the  insurance,  it  was  his  object  to  secure.^  (a) 
When  the  words  are,  without  violence,  susceptible  of  two 
interpretations,  that  which  will  sustain  his  claim  and  cover 
the  loss  must,  in  preference,  be  adopted.  2  While  courts  will 
extend  all  reasonable  protection  to  insurers,  by  allowing 
them  to  hedge  themselves  about  by  conditions  intended  to 
guard  against  fraud,  carelessness,  want  of  interest,  and  the 
like,  they  will  nevertheless  enforce  the  salutary  rule  of  con- 
struction, that  as  the  language  of  the  conditions  is  theirs, 
and  it  is  therefore  in  their  power  to  provide  for  every  proper 
case,  it  is  to  be  construed  most  favorably  to  the  insured.  ^ 
Thus,  if  a  stipulation  be  ambiguous,    and  no  light  can  be 

1  [AH  conditions  will  be  liberally  construed  in  favor  of  the  assured.  Ala. 
Gold  Life  Ins.  Co.  v.  Johnston,  80  Ala.  467  ;  Piedmont,  &c.  L.  Ins.  Co.  v.  Youno', 
58  Ala.  476  ;  Pelly  ■;;.  Royal  Exch.  Ass.  Co.,  1  Burrows,  341,  349  ;  Western 
Ins.  Co.  V.  Cropper,  32  Pa.  St.  351,  355.  The  contract  will  be  sustained  if  pos- 
sible, and  liberally  construed  to  secure  indemnity  —  the  object  of  the  contract. 
Phoenix  Ins.  Co.  v.  Barnd,  16  Neb.  89  ;  Grandin  v.  Insurance  Co.,  107  Pa.  St.  26  ; 
Schrceder  i;.  Trade  Ins.  Co.,  109  111.  157  ;  Lyon  v.  Travelers'  Ins.  Co.,  55  Mich. 
142 ;  Miner  v.  Mich.  Mut.  Ben.  Ass.,  63  Mich.  338.  The  courts  will  not  draw  fine 
distinctions  nor  allow  the  company  to  escape  on  mere  technicalities.  Agricul- 
tural Ins.  Co.  V.  Bemiller,  70  Md.  400.  The  design  of  the  assured  being  to 
lirovide  for  themselves  an  indemnity  against  loss,  from  which  the  insurers  agree 
to  protect  them,  such  a  construction  should  be  jilaced  on  their  compact  as,  ac- 
cording to  the  nature  of  the  transaction,  will  effectuate  that  object.  Riggin  v. 
Patapsco  Ins.   Co.,  7  H.  &  J.  (Md.)  279,  287.] 

2  Westfall  V.  Hudson  River  Fire  Ins.  Co.,  2  Duer  (N.  Y.  Superior  Ct.),  490. 
And  see  ante,  §§  171,  174  ;  pod,  §  243. 

3  Western  Ins.  Co.  v.  Cropper,  32  Pa.  St.  351. 

(a)  Policies,  notices,  or  contracts.  Rep.  500 ;  Canton  Ins.  Office  v.  Wood- 
when  written  on  forms  prepared  by  the  side,  90  id.  301,  305  ;  Janneck  v.  Met'n 
insurer,  are  interpreted,  in  all  cases  of  L.  Ins.  Co.,  162 N.Y.  574;  Forest  City 
uncertainty,  most  favorably  to  the  in-  Ins.  Co.  v.  Hardesty,  182  111.  39.  If 
sured.  Thompson  u.  Phenix  Ins.  Co.,  clear  and  unambiguous  in  meaning,  their 
136  U.  S.  287,  297  ;  Imperial  Fire  Ins.  construction  is  for  the  court,  and  their 
Co.  V.  Coos  County,  151  id.  452,  462  ;  terms  are  taken  and  understood  in  their 
^tna  Life  Ins.  Co.  v.  Smith,  88  Fed.  plain,  ordinary,  and  popular  sense. 
Rep.  440,  444  ;  Mass.  Benefit  Life  Ass'n  Ibid.  ;  Liverpool,  &c.  Ins.  Co.  v.  Kear- 
V.  Robinson,  104  Ga.  256.  So  words  and  ney,  36  C.  C.  A.  265 ;  270  ;  Fred.  J. 
clauses,  when  ambiguous  in  meaning,  Kiesel  &  Co.  v.  Sun  Ins.  Co.,  88  Fed. 
are  construed  against  the  insurer,  who  Rep.  243  ;  Thurston  v.  Burnett,  &c.  Ins. 
uses  them,  so  as  to  validate  the  indemnity  Co.,  98  Wis.  476.  Insurance  policies 
promised  by  the  policy  and  not  destroy  are  always  given  a  reasonable  construc- 
it.  Impenal  Fire  Ins.  Co.  i'.  Coos  tion,  such  as  will  fairly  carrv  their  pro- 
County,  151  U.  S.  452,  462;  London  visions  into  effect.  Springfidd  F.  &M. 
&  L.  Fire  Ins.  Co.  v.  Fischer,  92  Fed.  Ins.  Co.  v.  McLimans,  28  Neb.  846. 

344 


CH.  VIII.]    WAEKANTIES. — APPLICATION.— CONSTRUCTION.      [§  175 

thrown  upon  it  in  accordance  with  the  received  principles 
of  law,  from  extrinsic  evidence,  the  doubt  is  to  be  resolved 
against  the  party  by  whom  and  in  whose  favor  the  stipula- 
tion is  made.i  The  words  of  a  promise,  with  its  exceptions 
and  qualifications,  are  to  be  considered  as  those  of  the 
promisor,  while  those  of  a  representation  on  which  the 
promise  is  founded  are  the  words  of  the  promisee.  If  a 
question  be  equivocal,  so  that  it  is  susceptible  of  being  an- 
swered in  more  than  one  way,  and  differently  from  different 
points  of  view,  it  will  i)ot  be  open  to  the  company  which 
prepares  the  question  to  object  that  it  is  not  answered  in 
the  true  sense. ^  Thus  the  question  whether  one  has  suffered 
any  serious  injury  might  be  answered  in  the  affirmative  if 
regarded  in  the  light  of  the  severity  of  the  suffering  and 
temporary  inconvenience  occasioned  at  the  time.  But  looked 
at  afterwards,  and  after  a  permanent  and  complete  recovery, 
it  may  well  be  answered  in  the  negative,  so  far  as  the  injury 
is  material  to  the  question  of  the  value  of  a  life  risk.^  So 
an  incidental  communication  from  the  insurer  to  the  insured 
will  be  deemed  to  contain  not  only  all  the  language  ex- 
presses, but  all  that  can  be  fairly  deducible  therefrom  in  the 
light  of  the  circumstances  under  which  it  is  made.     Thus, 


1  [An  ambiguous  policy  shall  be  construed  most  strongly  against  the  insurer 
and  liberally  in  favor  of  the  assured.  Brink  v.  Merchants'  &  Mechanics'  Ins. 
Co.,  49  Vt.  442,  457  ;  Kratzenstein  v.  Western  Ass.  Co.,  116  N.  Y.  54  ;  Bo- 
right  V.  Springfield  F.  &  M.  Ins.  Co.,  34  Minn.  352  ;  Olson  v.  St.  Paul  F.  &  M. 
Ins.  Co.,  35  Minn.  432  ;  DeGrafif  v.  Queen  Ins.  Co.,  38  Minn.  501  ;  Liverpool, 
&c.  Ins.  Co.  V.  Van  Os,  63  Miss.  431,  441  ;  Metropolitan  L.  Ins.  Co.  v.  Drach, 
101  Pa.  St.  278  ;  Burkhard  v.  Travelers'  Ins.  Co.,  102  Pa.  St.  262;  Goddard  v. 
Ins.  Co.,  67  Tex.  69  ;  Grandin  v.  Insurance  Co.,  107  Pa.  St.  26  ;  Cargill  v.  Millers', 
&c.  Mut.  Ins.  Co.,  33  Minn.  90  ;  Northwestern  Mut.  L.  Ins.  Co.  v.  Ross,  63 
Ga.  199  ;  PhcEuix  Ins.  Co.  v.  Spiers,  87  Ky.  285  ;  Teutonia  Ins.  Co.  r.  Boylston 
Mut.  Ins.  Co.,  20  Fed.  Rep.  148  (La.),  1884.  If  an  exception  in  a  policy  be 
capable  of  two  equally  reasonable  interpretations,  that  must  be  adopted  most 
favorable  to  the  assured,  for  the  language  is  the  company's.  Western  Ins.  Co. 
V.  Cropper,  32  Pa.  St.  351,  355  ;  Commonwealth  Ins.  Co.  v.  Berger,  42  Pa.  St.  285, 
292.] 

2  Western  Ins.  Co.  v.  Cropper,  32  Pa.  St.  351  ;  Wilson  v.  Hampden  Fire  Ins. 
Co.,  4  R.  I.  150  ;  ^tna  Ins.  Co.  v.  Jackson,  16  B.  Mon.  (Ky.)  242  :  Bartlett  v. 
Union  Mut.  Fire  Ins.  Co.,  46  Me.  500  ;  Wilson  v.  Conway  Ins.  Co.,  4  R.  I.  141 T 
post,  §  210. 

8  Union  Mut.  Ins.  Co.  v.  Wilkinson,  13  Wall.  (U.  S.)  222. 

345 


§   176]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.         [CH.  VIIl. 

if  notice  of  additional  insurance  and  an  approval  in  writing 
by  the  insurers  be  required,  an  acknowledgment  in  writing 
that  notice  has  been  received,  without  more,  will  be  deemed 
an  approval.^  So  words  of  exception,  if  of  doubtful  import, 
are  to  be  construed  most  strongly  against  the  party  in  whose 
interest  they  are  introduced. ^ 

§  176.  Same  Subject.  — An  instance  of  the  application  of 
the  doctrine  that  where  there  is  any  ambiguity  in  a  policy  it 
must  be  taken  most  strongly  against  the  party  who  prepares 
it,  is  well  illustrated  in  a  comparatively  recent  case.  The 
proposal  or  declaration  is  made  the  basis  of  the  contract  and 
part  of  the  policy,  affirms  that  its  particular  statements  are 
"correct  and  true  throughout,"  and  stipulates  that  if  it  shall 
hereafter  appear  that  any  fraudulent  concealment  or  de- 
signedly untrue  statement  is  made,  the  policy  shall  be  void. 
It  was  contended  by  the  insurers  that  by  this  language  the 
policy  was  to  be  void  not  only  upon  an  untrue  statement  de- 
signedly made,  but  also  upon  an  untrue  statement  honestly 
made.  But  the  court  replied,  that  upon  that  construction 
the  clause  which  relates  to  designedly  untrue  statements 
would  be  superfluous,  because  only  a  reiteration  of  that 
which  is  involved  in  the  former  clause  requiring  the  partic- 
ulars to  be  correct  and  true.  But  in  construing  an  instru- 
ment prepared  by  the  insurers,  it  ought  to  be  read  most 
strongly  against  the  makers,  and  inasmuch  as,  upon  the 
construction  contended  for,  the  latter  clause  would  be  wholly 
unnecessary,  it  should  rather  be  construed  as  raerely  explan- 
atory of  what  is  meant  by  the  terms  "  correct "  and  "  true  " 
in  the  former  clause.^  Upon  the  same  grounds  courts  will 
not  make  forfeiture  a  penalty  where  the  contract  has  not  so 
distinctly  provided.* 

1  Potter  u.  Ontario  &  Liv.  Mut,  Ins.  Co.,  5  Hill  (N.  Y.),  147  ;  Robertson  v. 
French,  4  East,  135;  post,  §  371  ;  Washington  Life  Ins.  Co.?;.  Schaibie  (Pa.), 
1  Weekly  Notes  Cas.  369. 

2  Palmer  v.  Warren  Ins.  Co.,  1  Story,  C.  Ct.  360  ;  Blackett  v.  Royal  Ex.  Ins. 
Co.,  2  Cronip.  &  Jer.  244. 

3  Fowkes  V.  Manchester  &  London  Life  Ass.  Association,  3  Best  &  Smith, 
Q.  B.  917  ;  s.  c.  E.  C.  L.  113,  917.     See  also  post,  §  193. 

*  Mut.  Fire  Ins.  Co.  v.  Coatesville,  80  Pa.  St.  407  ;  National    Bank  v.  Hart- 
ford Fire  Ins.  Co.,  95  U.  S.  673  ;  Wilkins  v.  Tobacco  Ins.  Co.,  30  Ohio  St.  317  ; 
346 


CH.  VIIL]    WAKKANTIES. — APrLICATION. — CONSTRUCTION.       [§  177 

§  177.  Written  over  Printed  Words  prevail.  —  As  in  all 
contracts  consisting  partly  of  printed  matter  and  partly  of 
written,  so  with  contracts  of  insurance,  where  any  discrep- 
ancy or  repugnancy  exists,  the  written  portion  is  to  prevail 
over  the  printed,^  for  the  obvious  reason  that  as  the  latter 
contains  the  more  general  and  formal  provisions  applicable 
for  the  most  part  to  all  cases,  there  is  more  ground  for  sup- 
posing that  these  have  not  been  erased  or  modified  so  as  to 
conform  to  the  written  portion,  through  inadvertence,  than 
that  the  special  and  peculiar  provisions  of  the  written  por- 
tion have  been  adopted  without  due  consideration,  and  in- 
serted without  the  design  or  contrary  to  the  intention  of  the 
parties.2(a)     The  printed  forms  are  calculated  for  ordinary 

Behler  v.  German,  &c.  Ins.  Co.  (Ind.),  9  lus.  L.  J.  778.     But  see  Hill  v.  Equita- 
ble, &c.  Ins.  Co.  (N.  H.),  6  id.  314. 

1  [Grandiu  v.  Ins.  Co.,  107  Pa.  St.  26  ;  Plinsky  v.  Germania  F.  &  M.  Ins.  Co., 
32  Fed.  Kep.  47  (Mich.),  1887  ;  Liverpool,  &c.  Ins.  Co.  v.  Van  Os,  63  Miss. 
431,  441  ;  Georgia  Home  Ins.  Co.  v.  Jacobs,  56  Tex.  366.  Written  words  con- 
trol the  printed  formula  of  a  policy  wherever  there  is  a  discrepancy  ;  Bargett 
V.  Orient  Mut.  Ins.  Co.,  3  Bos.  (N.  Y.)  385,  396  ;  Coster  v.  Phoenix  Ins.  Co., 
2  Wash.  U.  S.  51,  53  ;  Schroeder  v.  Stock  &  Mutual  Ins.-  Co.,  46  Mo.  174, 
176  ;  without  reference  to  their  respective  priority  of  place.  Leeds  v.  Me- 
chanics' Ins.  Co.,  8  N.  Y.  351,  356;  Hernandes  v.  Sun  Mutual  Ins.  Co.,  6 
Blatch.  317,  325.  In  one  case  it  was  held  that  where  the  printed  form  pro- 
vides that  its  general  terms  shall  be  controlled  by  indorsements  of  special 
risks,  the  print  is  incomplete  and  ineffective  until  made  definite  and  certain  by 
the  indorsement,  which  in  each  case  fixes  the  amount  and  nature  of  the  risk, 
and  if  the  print  insures  against  loss  of  goods  "laden  on  vessels,  railroad,  or 
carriage,"  and  the  writing  omits  "carriage,"  the  loss  of  goods  while  in  a  car- 
riage is  not  covered.  Kratzenstein  v.  Western  Ass.  Co.,  53  N.  Y.  Super.  505. 
But  on  appeal  the  decision  was  reversed,  the  court  saying  that  as  there  was  no 
conflict  between  the  print  and  the  writing  every  word  must  have  its  effect. 
Kratzenstein  v.  Western  Ass.  Co.,  116  N.  Y.  54  ;  reversing  21  Jones  &  Spen. 
505.] 

2  Robertson  v.  French,  4  East,  135. 

(a)  See  West  Branch  Lumberman's  Co.,  98  id.  129;  Phoenix  Ins.  Co.  v. 
Exchange  v.  American  Central  Ins.  Co.,  Flemming,  65  Ark.  54  ;  Kussell  v. 
183  Penn.  St.  366  ;  Faust  v.  American  Manufacturers'  &  Builders'  F.  Ins.  Co., 
F.  Ins.  Co.,  91  Wis.  158  ;  Parker  v.  50  Minn.  409 ;  Vandervolgen  v.  Man- 
China  Mut.  Ins.  Co.,  164  Mass.  237  ;  chaster  F.  Ass.  Co.  (Mich.),  82  N.  W. 
Maril  v.  Conn.  F.  Ins.  Co.,  95  Ga.  604  ;  46.  In  Massachusetts  the  act  of  1894, 
Crew-Levick  Co.  v.  British  &  Foreign  ch.  522,  §  60,  cl.  7,  authorized  slips  or 
M.  Ins.  Co.,  77  Fed.  Rep.  858  ;  Palatine  riders  to  be  attached  to  policies  modify- 
Ins.  Co.  V.  Ewing,  92  id.  Ill,  114  ;  ing  the  provisions  in  the  body  of  the 
Hagan  v.  Scottish   Union  &  Nat'l  Ins.  policy.     See  Hardy  v.   Lancashire  Ins. 


o 


47 


§  177]  INSURANCE  :   FIRE,    LIFE,   ACCIDENT,    ETC.  [ciI.  VIII. 

risks,  and  contain  the  provisions  and  conditions  usually 
attached  to  insurances  upon  them.  They  must,  therefore, 
necessarily  be  general  and  comprehensive  in  their  terms, 
and  not  suited  to  insurances  upon  other  and  special  hazards. 
It  is  the  ordinary  course  that  upon  each  application  a  spe- 
cial agreement  is  made  between  the  applicant  and  under- 
writer, designating  and  describing  the  premises  required  to 
be  insured,  and  fixing  the  terms  of  that  particular  insur- 
ance; and  the  policy  is  then  completed  by  filling  up  the 
blank  spaces  left  in  the  printed  form  with  suitable  words 
and  clauses  to  express  the  contract  thus  agreed  upon.  This 
is  the  usual  mode  of  consummating  the  contract,  and  not 
unfrequently  the  printed  form  of  the  policy  is  left  unaltered, 
without  expunging  or  modifying  the  parts  of  it  which  con- 
flict with  the  written  clauses.  These  written  clauses,  never- 
theless, contain  the  elements  of  the  contract,  and  being 
framed  under  the  immediate  eye  of  the  parties,  and  with 
special  reference  to  the  exigencies  of  the  particular  contract, 
and  to  the  terms  agreed  upon,  they  sometimes  present  a  con- 
tract to  which  some  of  the  printed  parts  of  the  policy  are 
inapplicable.  And  as  effect  must  be  given  to  the  acknowl- 
edged intentions  of  the  parties,  these  written  clauses  must 

Co.,  166  Mass.  210.  lu  States  like  App.  11  ;  see  Jackson  v.  British  Amer- 
Massachusetts,  which  have  a  standard  ica  Ass.  Co.  (Mich.),  30  L.  R.  A.  636, 
form  of  policy  prescribed  by  statute,  and  note  ;  Jones  v.  New  York  L.  Ins. 
the  insurer's  agents,  and  even  its  general  Co.,  168  Mass.  245.  If  the  main  body 
agents,  cannot  vary  this  standard  form  of  the  policy  contains  no  agreement  on  a 
without  clear  authority,  and  then  only  particular  subject,  a  rider,  which  is  a 
by  inserting  provisions  or  attaching  slips  small  slip  of  paper  pasted  on  the  face  of 
in  the  manner  prescribed  by  the  statute,  the  policy,  when  it  has  no  logical  con- 
Parker  V.  Rochester  German  Ins.  Co.,  nection  with,  or  relation  to  the  warran- 
162  Mass.  479,  481  ;  Hilly.  Commercial  ties  expressed  in  the  policy,  such  as  one 
Union  Ass.  Co.,  164  Mass.  406  ;  Straker  providing  for  a  watchman  when  a  mill 
V.  Phenix  Ins.  Co.,  101  Wis.  413;  supra,  is  idle,  is  merely  a  representation,  the 
p.  233,  note  {a).  violation  of  which  does  not  work  a  for- 
The  body  of  the  policy  is  the  real  feiture  when  the  loss  is  not  due  to  such 
contract  between  the  parties;  but  cer-  violation.  Hart »;.  Niagara  F.  Ins.  Co.,  9 
tain  material  stipulations,  such  as  the  Wash.  620.  So  a  standard  guaranty  to 
"iron-safe  clause,"  when  printed  or  maintain  eighty  per  cent  insurance,  when 
written  upon  a  slip  attached  to  the  stamped  on  the  face  of  the  policy,  does 
policy,  are  treated  as  constituting  part  not  supersede  the  provision  against  fur- 
of  the  policy,  though  not  in  its  body,  ther  insurance  in  a  fire  policy.  Cutler 
Criglei  V.  Standard  F.  Ins.  Co.,  49  Mo.  v.  Royal  Ins.  Co.,  70  Conn.  566,  572. 

348 


Cir.  VIII.]    WARRANTIES. — APPLICATION. — CONSTRUCTION.      [§  178 

necessarily  supersede  and  control  such  of  the  printed  clauses 
as  would,  if  enforced  and  literally  applied,  be  inconsistent 
with  them.i 

§  178.  Insurers  confined  to  the  Exact  Words  of  the  "War- 
ranty. —  The  strictness  with  which  courts  will  hold  insurers 
seeking  to  set  up  a  warranty,  a  breach  of  which  works  a  for- 
feiture, is  well  illustrated  by  the  following  cases:  The  ap- 
plication and  conditions  annexed  were  referred  to  and  made 
part  of  the  policy.  The  insurance  was  upon  a  "stock  of 
merchandise."  In  the  application,  to  the  question,  "For 
what  purpose  is  the  building  used  ? "  it  was  answered, 
"  Wholesale  and  retail  hardware ;  "  and  to  the  question, 
"How  many  tenants?"  the  answer  was  "One."  In  fact, 
the  second  story  of  the  building  was  occupied  as  a  clothing- 
store,  and  the  upper  story  for  lodging-rooms.  The  insured 
covenants  that  the  representation  given  in  the  application  is 
a  warranty,  and  contains  a  just,  full,  and  true  exposition  of 
all  the  facts  and  circumstances  in  regard  to  the  condition, 
situation,  and  value  of  the  property  insured,  and  if  facts  or 
circumstances  shall  not  be  fairly  represented,  then  the  pol- 
icy is  to  be  void.  In  the  policy,  also,  insurance  is  said  to 
be  on  the  property  described  in  the  application,  which  is 
referred  to  and  made  part  of  the  policy,  and  declared  to  be 
a  warranty.  It  was  held  that  while  the  policy  would  be 
void  if  the  representations  relating  to  the  property  insured 
were  untrue,  yet  that  false  representations  as  to  matters 
outside  and  independent  of  the  property  insured,  and  which 
had  not  in  any  degree  contributed  to  the  loss,  would  not 
avoid  the  policy ;  and  as  the  stipulations  both  in  the  appli- 
cation and  in  the  policy  have  reference  to  the  property  in- 
sured, and  in  respect  to  this  there  was  no  untruthfulness,  a 
false  representation  as  to  the  occupancy  of  the  building 
which  was  not  insured  did  not  avoid  the  policy,^  In  an- 
other case,  the  insurance  was  upon  a  "stock  of  goods  and 
merchandise, "  with  a  stipulation  that  if  the  "  premises  "  be 

1  Delonguemare  v.  Tradesmen's  Ins.  Co.,  2  Hall  (N.  Y.),  589,  622;  Colt  v 
Phoenix  Ins.  Co.,  54  N.  Y.  595. 

'^  Howard  Fire  &  Mar.  Ins.  Co.  v.  Cornick,  24  111.  455. 

349 


§178]         insurance:  fiee,  life,  accident,  etc.       [ch.  viil 

"appropriated,  applied,  or  used  for  the  purpose  of  storing 
or  keeping  therein,"  amongst  other  things,  "oil  and  cotton," 
the  policy  should  be  of  no  effect  during  such  use.  A  barrel 
of  oil,  with  bunches  of  cotton  near  it,  had  been  kept  in  the 
back  part  of  the  store  for  a  short  time  previous  to  the  fire. 
But  it  was  held  that  the  clause  by  its  terms  was  confined  to 
the  case  of  a  building  insured,  —  a  case  not  covered  by  the 
policy;  and  if  the  case  had  been  covered  by  the  policy  it 
should  have  been  construed  to  forbid  the  appropriation  or 
chief  use  of  the  building  for  any  of  the  prohibited  purposes, 
and  not  the  incidental  keeping  of  small  quantities  of  pro- 
hibited articles  for  retail,  along  with  a  general  stock  of 
goods.  1  So  an  alteration  in  the  status  of  the  property  in- 
sured, the  same  not  being  a  building,  as  for  instance  the 
machinery  in  a  building,  is  not  an  alteration  in  the  "  prem- 
ises "  insured  such  as  will  work  a  forfeiture.^  And  to  pre- 
vent a  forfeiture  by  such  a  breach  of  warranty,  a  bare, 
literal,  and  technical  compliance  on  the  part  of  the  insured 
with  the  terms  of  the  contract  will  sometimes  be  held  to  be 
sufficient,  —  a  compliance  which  is  nearly  tantamount  to  an 
evasion.  Thus,  under  a  warranty  that  mills  are  worked  by 
day  only,  keeping  up  the  fires  and  running  the  engine  by 
night,  the  machinery  not  being  attached,  would  constitute 
no  breach.^  [A  mere  cold  does  not  render  false  the  warranty 
that  the  insured  had  not  "been  sick  or  afflicted  with  dis- 
ease."* When  the  policy  described  the  business  carried  on 
in  the  insured  premises,  as  the  manufacture  of  bath  tubs,  it 
was  held  that  it  was  no  breach  of  the  warranty  that  a  tube 
brought  to  the  premises  shavings  from  another  building  used 
for  other  purposes.^  But  a  condition  precedent  to  a  policy 
on  a  ship,  providing  that  she  must  sail  on  a  certain  day, 
&c.,  and  "be  ready  for  sea,"  is  not  complied  with  when  only 
the  master,  mate,  one  seaman,  and  two  boys  were  on  board, 

1  Leggett  V.  ^tna  Ins.  Co.,  10  Rich.  Law  (S.  C),  202. 

2  Robinson  v.  Mercer  County  Mut.  Ins.  Co.,  3  Dutch.  (N.  J.)  134,  135. 

3  Mayall  v.  Mitford,  6  Ad.  &  El.  670  ;  Hide  v.  Bruce,  3  Doug.  213;  1  Bennet 
F.  Ins.  Cases,  107  ;  Peoria  Mar.  &  Fire  Ins.  Co.  v.  Lewis,  18  111.  553. 

*  [Metropolitan  L.  Ins.  Co.  v.  McTague,  49  N.  J.  587.] 
6  [Keeney  v.  Home  Ins.  Co.,  71  N.  Y.  397,  405-] 

350 


CH.  VIII.]    WARRANTIES. — APPLICATION. — CONSTRUCTION.        [§  179 

and  when  she  had  to  have  assistance  to  get  down  the  harbor. 
And  hence  the  policy  did  not  take  effect.^] 

§  179.  Custom  and  Usage  as  Aids  to  Interpretation.  —  We 
have  just  seen'"^  that  usage  is  not  unfrequently,  especially  in 
marine  insurance,  resorted  to  in  aid  of  interpretation.  But 
having  due  regard  to  the  incidental  differences  in  the  vari- 
ous kinds  of  risks,  the  rules  under  which  evidence  of  custom 
and  usage  is  admissible  in  aid  of  the  interpretation  of  ma- 
rine insurances  are  equally  applicable  to  all  the  other  kinds 
of  insurances,  and  have  been  so  well  stated  by  a  learned 
author  ^  that  we  take  pleasure  in  transferring  them  to  these 
pages.     They  are  as  follows:  — 

"1.  Every  usage  of  a  particular  trade,  which  is  so  well 
settled  or  so  generally  known  that  all  persons  engaged  in 
that  trade  may  be  fairly  considered  as  contracting  with  ref- 
erence to  it,  is  considered  to  form  part  of  every  policy,  de- 
signed to  protect  risks  in  such  trade,  unless  the  express 
terms  of  the  policy  decisively  repel  the  inference. 

"  2.  The  usage,  moreover,  in  order  to  be  binding,  must  be 
either  a  general  usage  of  the  whole  mercantile  world,  or  a 
particular  usage  of  universal  notoriety  in  the  trade  upon 
which,  and  of  the  place  at  which,  the  insurance  is  effected ; 
the  usage  of  a  particular  place,  or  of  a  particular  class  of 
persons,  cannot  be  binding  on  non-residents,  or  on  other 
persons,  unless  they  are  shown  to  have  been  cognizant  of  it. 

"3.  Where  the  sense  of  the  words  and  expressions  used 
in  a  policy  is  either  ambiguous  or  obscure  on  the  face  of  the 
instrument,  or  is  made  so  by  proof  of  extrinsic  circum- 
stances, parol  evidence  is  admissible  to  explain  by  usage 
their  meaning  in  the  given  case. 

"  4.  A  resort  to  parol  evidence,  however,  is  only  permitted 
where  the  language  of  the  policy  is  either  obscure  or  equivo- 
cal; such  evidence  will  never  be  admitted  to  set  aside  or 
control  its  plain  and  unambiguous  terms." 

Thus,  proof  is  admissible  that  camphene  is  customarily 

1  [Graham  v.  Barros,  5  B.  &  Adolph.  1011,  1018.] 

2  Ante,  §  173. 

8  Arnould  on  Insurance,  65  et  seq. 

351 


§  179  A]  INSURANCE  :   FIRE,   LIFE,   ACCIDENT,   ETC.        [cil.  VIII. 

used  in  printing  establishments  to  clean  type;^  or  that 
benzole  is  so  used  in  patent-leather  factories,  and  is  handled 
in  a  particular  way  ;2  or  that  amongst  manufacturers  "  room  " 
means  "loft,"  whether  the  loft  be  partitioned  into  distinct 
apartments  or  not ;  ^  [or  that  the  word  "  roots  "  means  only 
perishable  roots,  and  that  sarsaparilla  is  not  included ;  *]  or 
that  a  house  built  in  a  certain  manner  is  by  usage  treated  as 
a  house  "_ filled  in  with  brick  ; "  ^  and  what  is  the  accepted 
meaning  of  "store  fixture"  amongst  insurance  companies;^ 
and,  generally,  of  the  meaning  of  any  particular  term  which 
has  in  any  trade  secured  a  limited  or  special  meaning,  dif- 
ferent from  its  popular  acceptation,  when  the  term  is  used  in 
a  contract  with  a  person  engaged  in  that  trade. '^ 

[§  179  A.  Usages  Lawful  and  Knovsrn  explain  a  Contract  that 
does  not  exclude  them.  —  Insurers  are  presumed  to  be  familiar 
with  the  usages  and  incidents  of  a  risk,  and  contracts  of  in- 
surance are  always  construed  with  reference  thereto.^  When 
it  appears  that  the  parties  contracted  with  reference  to  a  cus- 
tom of  the  city  where  they  did  business,  the  general  law 
yields  to  the  usage.  Where  a  policy  is  underwritten  upon  a 
foreign  vessel  the  insurer  is  presumed  to  know  the  common 
usages  of  trade  in  such  country.^  Usage  is  admissible  to 
explain  what  is  doubtful  in  written  contracts, ^*^  but  not  to 
contradict  what  is  clear;  although  even  plain  words  many 
times  acquire  a  special  meaning  through  reference  to  well- 
established  usage.  Deviation  from  a  policy  if  according  to 
usage,  does  not  per  se  prevent  recovery.  ^^  When  a  policy  is 
made  upon  a  particular  voyage,  the  established  usages  relat- 

1  Harper  v.  City  Ins.  Co.,  1  Bo.w.  (N.  Y.  Superior  Ct.)  520. 
-  Citizens'  Ins.  Co.  v.  McLaughlin,  53  Pa.  St.  485. 

2  Daniels  v.  Hudson  River  Fire  Ins.  Co.,  12  Cushing  (Mass.),  416. 
*  [Coit  V.  Com.  Ins.  Co.,  7  Johns.  385,  390.] 

6  Fowler  v.  vEtna  Fire  Ins.  Co.,  7  "VVend.  (N.  Y.)  270. 

6  Whitmarsh  v.  Conwa}'  Fire  Ins.  Co.,  16  Gray  (Mass.),  359. 

''  Wall  V.  Howard  Ins.  Co.,  14  Barb.  (N.  Y.)  383. 

8  [Fulton  Ins.  Co.  v.  Milner,  23  Ala.  420,  427 ;  Hancox  v.  Fishing  Ins.  Co., 
3  Sum.  (U.  S.)  132,  137-] 

9  [Hazard  v.  N.  E.  Mar.  Ins.  Co.,  8  Pet.  557,  580.  See  also  Buck  v.  Chesa- 
peake Ins.  Co.,  1  Pet.  151,  160.] 

10  [Macy  v.  Whaling  Ins.  Co.,  9  Met.  (Mass.)  354,  363.] 
u  [Bond  V.  Gonsales,  2  Salk.  445.] 

352 


CH.Vm.]    WARKANTIES.—AFPLICATION.— CONSTRUCTION.  [§  179  C 

ing  to  such  voyage  are  impliedly  a  part  of  the  contract,  even 
though  not  expressly  made  so.^  Usage  of  an  insurance  com- 
pany may  make  valid  a  contract  made  by  the  president,  in 
deviation  from  the  risk  assumed  in  the  policy,  by  waiver 
thereof,  for  a  compensation  agreed  between  the  president 
and  the  assured,  the  waiver  and  assent  being  written,  with 
its  terms,  across  the  policy  without  any  new  signature,  and 
being  recorded  by  the  secretary.  2  A  regular  usage  for  twenty 
years,  not  explained  or  contradicted,  is  an  immemorial 
record.^] 

[§  179  B.  Usage  counter  to  Settled  Principle  of  Law  and 
Justice  not  sustained.  —  The  usage  of  no  class  of  citizens  can 
be  sustained  in  opposition  to  principles  of  law>  A  usage 
at  a  particular  place  without  reference  to  the  proceeds  of 
old  materials  not  used  in  the  repairs,  is  contrary  to  the 
well  settled  rules  of  law,  and  to  the  principle  of  indemnity, 
and  is  therefore  void.^] 

[§  179  C.  Knowledge.  —  The  person  against  whom  the 
usage  is  invoked  must  be  shown  to  have  known  of  it,  or  to 
have  adopted  it  by  the  nature  of  his  dealings,  or  to  have 
constructive  knowledge  by  the  generality  and  established 
character  of  it.  A  usage  of  one  insurance  house,  not  gener- 
ally known  nor  shown  to  be  known  to  plaintiff,  who  was  not 
in  the  habit  of  taking  out  policies  where  the  usage  prevailed, 
does  not  bind  him.^  When  a  policy  prohibited  the  carrying 
of  more  than  a  certain  weight  of  coal,  and  the  assured  car- 
ried more  than  that  weight  of  a  "patent  fuel,"  claimed  to  be 
materially  different  from  coal,  loaded  at  Cardiff  (a  foreign 
port),  a  local  usage  known  only  at  that  place,  in  support  of 
his  position,  is  not  sufficient.  It  must  be  shown  to  have 
been  known  to  both  the  parties  at  the  contract's  inception,^ 
or  so  generally  known  that  they  must  be  presumed  to  have 

1  [Bulldey  v.  Protection  Ins.  Co.,  2  Paine  (U.  S.),  82,  91.] 

2  [Warren  v.  Ocean  Ins.  Co.,  16  Me.  439,  450.] 
8  [King  V.  Joliffe,  2  B.  &  C.  54,  59.] 

4  [Homer  v.  Dorr,  10  Mass.  26,  28.] 

6  [Eager  v.  Atlas  Ins.  Co.,  14  Pick.  141,  144.] 

6  [Gabay  v.  Lloyd,  3  B.  &  C.  793,  797.] 

1  [Howard  v.  Great  Western  Ins.  Co.,  109  Mass.  384,  389.] 

VOL.  I.  — 23  353 


§  179  E]        INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.         [CH.  VIII. 

contracted  in  reference  to  it.  The  phrase  "standing  de- 
tached "  is  not  ambiguous  or  open  to  evidence  of  usage  that 
among  insurance  men  the  words  mean  a  space  of  at  least 
twenty-five  feet.  ^  Unless  the  assured  knew  or  had  notice  of 
the  sense  in  which  it  was  employed. ^J 

[§  179  D.  Usage  cannot  change  a  Contract  ^A^hose  terms  are 
Clearly  Inconsistent  with  it.  —  When  words  have  no  uncer- 
tain meaning,  parol  evidence  of  a  commercial  understanding 
of  them  is  inadmissible.^  The  clear  provisions  of  a  contract 
cannot  be  defeated  by  proof  of  the  existence  of  a  custom  dif- 
fering therefrom.'*  The  force  and  legal  effect  of  an  unam- 
biguous and  unequivocal  agreement  between  two  insurance 
companies  cannot  be  changed  by  proof  that  by  custom  and 
usage  its  performance  is  not  required.^  The  true  office  of  a 
usage  or  custom  is  to  interpret  the  otlierivise  indeterminate 
intentions  of  the  parties,  and  to  ascertain  the  nature  and 
extent  of  their  contracts,  arising  not  from  express  stipula- 
tions, but  from  mere  implications  and  presumptions  and  acts 
of  a  doubtful  or  equivocal  character.  ^  The  particular  usage 
or  by-law  of  an  insurance  company  to  pay  only  in  proportion 
to  what  is  paid  on  the  same  goods  by  another  company  can- 
not control  a  policy,  and  is  no  defence  to  a  suit  for  the 
whole  amount  insured."] 

[§  179  E.  The  Test.  — The  question  is,  "Did  the  parties 
contract  in  reference  to  the  usage,  or  do  certainty  and  facil- 
ity in  business  matters  require  that  they  should  be  presumed 
to  have  contemplated  it,  where  they  have  not  clearly  ex- 
pressed the  contrary  ?  "  In  order  that  a  party  may  be  bound 
by  a  usage  it  must  be  shown  that  he  had  knowledge  of  it. 
Usage  is  engrafted  upon  a  contract  or  invoked  to  give  it  a 
meaning,  on  the  assumption  that  the  parties  contracted  in 

1  [Hill  V.  Hibernia  Ins.  Co.,  10  Hnn,  26,  29.]  2  [la.] 

3  [Biugett  V.  Orient  Ins.  Co.,  3  Bos.  385,  396;   Kankin  v.  Amer.  Ins.  Co.,  1 

Hall  (N.  Y.),  619,  632.] 

*  [Duncan  v.  Green,  43  Iowa,  679,  680  ;    Marks  r.  Cass  Co.   Mill,   &c.  Co., 

id.  146,   148.] 

6  [St.  Nicholas  Ins.  Co.  v.  Mercantile  Ins.  Co.,  5  Bos.  238,  246.] 

6  [The  Schooner  Reeside,  2  Sumn.  (U.  S.)  567,  569.] 

'  [Lattomus  v.  Farmers'  Mut.  F.  Ins.  Co.,  8  Houst.  (Del.)  254,  255.] 

354 


CH.  VIII.]    WAERANTIES. — APPLICATION. — CONSTRUCTION.      [§  180 

reference  to  it.  If  there  is  a  general  usage,  applicable  to  a 
particular  profession,  parties  employing  an  individual  are 
supposed  to  deal  with  him  according  to  that  usage.  A  con- 
tract made  with  a  man  about  the  business  of  his  craft,  is 
framed  on  the  basis  of  its  usages  except  when  their  place  is 
occupied  by  other  stipulations.  Where  one  employs  another 
to  do  an  act  that  involves  the  conforming  to  some  usage,  as 
that  of  the  locality  where  the  act  is  to  be  done,  the  principal 
is  bound  by  such  usage.  If  a  custom  is  ancient,  very  gen- 
eral, and  well  known,  it  will  often  be  a  presumption  of  law 
that  the  party  had  knowledge  of  it.  As  a  rule,  a  local  usage 
must  be  brought  home  to  the  person  before  he  can  be  bound 
by  it  It  must  be  shown  that  he  had  actual  knowledge  of 
it,  or  there  must  be  evidence  raising  a  strong  presumption 
that  he  had  notice.  The  question  in  case  usage  is  intro- 
duced is,  whether  it  is  of  such  age  and  character  that  it  will 
be  conclusively  presumed  that  the  parties  knew  of  it,  as  in 
the  case  of  usages  that  have  become  part  of  the  common  law ; 
or  whether  it  is  so  local  and  particular  that  knowledge  must 
be  shown.  It  is  always  competent  for  the  party  to  disclaim 
knowledge,  for  the  jury  may  find  that  the  presumption  is  not 
one  of  law  but  only  one  of  fact,  as  in  the  case  of  evidence 
showing  a  local  usage  in  the  city  of  which  the  party  is  an 
inhabitant,  and  such  presumption  of  fact  may  be  negatived 
by  evidence  that  the  party  did  not  in  fact  know  of  the  usage.^ 
The  whole  substance  of  the  law  of  usage  is  a  common-sense 
determination  of  the  question  whether  under  all  the  circum- 
stances it  is  fair  to  consider  the  contract  affected  by  the 
usage  in  dispute.] 

§  180.  To  the  above  may  be  added  another  rule,  to  wit, 
that  proof,  whether  of  a  local  or  general  usage,  cannot  be 
resorted  to  for  the  purpose  of  importing  into  the  contract  a 
new  and  distinct  condition.  Thus  a  usage  that,  in  case  of 
the  occurrence  of  any  circumstance  by  the  act  of  the  insured 
after  effecting  the  insurance,  whereby  the  risk  is  increased, 
he  shall  give  notice  thereof  to  the  insurer,  that  the  latter 
may  then  elect  to  continue  or  annul  the  policy,  cannot  be 

1  [Walls  V.  Bailey,  49  N.  Y.  464.] 

355 


§  180  rt]        IXSURAXCE  :    FIKE,    LIFE,   ACCIPEXT,    ETC.         [CH.  VIH. 

received  in  evidence,  there  being  no  stipulation  in  the  pol- 
icv  requiring  such  notice.  ^  Xor  when  the  contract  is  to  pay 
all  loss  or  damage  bv  fire,  is  it  permissible  to  show  that 
reinsurers  are  accustomed  to  pay  only  such  proportion  of 
the  loss  as  is  shown  by  the  relation  which  the  amount  rein- 
sured bears  to  the  whole  amount  insured.  ^  Nor  where  the 
stipulation  is  to  keep  a  watch  nights,  can  a  usage  be  shown 
to  except  certain  nights.^  But  the  custom  of  other  similar 
establishments  may  be  shown  to  explain  what  is  "keeping  a 
watch."' *  And  in  a  case  where  a  building  was  torn  to  pieces 
by  liffhtning  but  not  burned,  and  the  company  was  liable  for 
losses  "by  fire  by  lightning,"  evidence  of  the  general  prac- 
tice in  other  insurance  companies  in  similar  cases,  not  to 
pay  where  there  is  no  burning,  was  held  admissible,  in  aid 
of  the  interpretation  of  the  phrase. °  So  the  custom  of  com- 
mission merchants  to  insure  goods  consigned  to  them,  with- 
out instructions,  in  their  own  names,  and  as  for  their  own 
account.^  But  a  custom  is  not  provable  to  contradict  the 
express  terms  of  a  contract,  —  for  instance,  as  to  payment 
of  premium.' 

§  180  a.  In  several  States  the  legislatures  have  interposed 
bv  statute  to  protect  the  insured  against  a  loss  of  the  benefit 
of  his  insurance  by  reason  of  immaterial  misrepresentations. 
Thns,  it  was  provided  in  Missouri,  by  the  act  of  March  :23, 
1874,  that  "no  misrepresentation  .  .  .  shall  be  deemed 
material  or  avoid  the  policy,  unless  the  matter  misrepre- 
sented shall  have  actually  contributed  to  the  contingency  or 
event  on  which  the  policy  is  to  become  due  or  payable;" 
and  it  was  held  that  a  policy  issued  within  the  State,  in 

J  Stftbbins  v.  Globe  Ins.  Co.,  2  Hall  (X.  Y.),  632. 

«  Home  r.  Mut.  Safety  Ins.  Co.,  1  Sandf.  (N.  Y.  Superior  Ct.  137  ;  s.  c. 
affirmed,  2  Comst  (N.  Y.)  235. 

8  Eipley      .£tna  Fire  Ins.  Co.,  30  X.  Y-  136. 

*  Crocker  r.  People's  Mat.  Ins.  Co.,  8  Casli.  (Mass.)  79. 

6  Babcock  f.  Montgomery  County  Mux.  Ins.  Co.,  6  Barb.  (X.  Y.)  637  ;  s.  c. 
affirmed,  4  Combt.  (X.  Y.)  326.     And  see  post,  §  5S2. 

«  DeForest  v.  Folton  Fire  Insurance  Company,  1  Hall  (N^ew  York  Superior 
Court),  84. 

"  Illinois,  &c.  Soc.  r.  Baldwin,  86  IlL  479 ;  Candee  v.  Citizens"  Ins.  Co.,  C.  Ct. 
(Conn.),  4  Fed.  Eep.  143. 

356 


CH.  YIII.]    WARRANTIES. — APPLICATION. — CONSTRUCTION.  [§  180  a 

which  "answers,  statements,  representations,  and  declara- 
tions," made  in  good  faith  and  contained  in  the  application 
which  was  made  a  part  of  the  policy,  were  "  warranted  "  to 
be  true  in  all  respects,  was  within  the  provisions  of  the 
statute.  1     The  Georgia  code  is  construed  in  the  same  way.^ 

Under  the  Massachusetts  statute,  ^  a  condition  in  the  policy 
that  misrepresentations  in  the  application  shall  avoid  the 
policy  is  good,  notwithstanding  the  law  provides  that  the 
application  shall  not  be  a  warranty  or  part  of  the  contract, 
except  so  far  as  it  is  incorporated  in  full  in  the  policy.* 

In  Ontario,  an  insurer  cannot  avail  himself  of  certain 
statutory  conditions,  or  of  the  conditions  of  the  contract, 
unless  the  statutory  conditions  are  printed  upon  the  policy, 
but  the  plaintiff  may  avail  himself  of  any  of  the  statutory 
conditions.^ 

This  statute  makes  certain  conditions  essential  to  any  pol- 
icy, provides  that  other  conditions  shall  be  printed  conspicu- 
ously both  in  type  and  ink,  and  that  they  shall  be  reasonable. 
It  seems  that  a  condition  that  a  policy  shall  be  void  if  the 
title  to  the  property  insured  shall  be  disputed  in  any  pro- 
ceeding at  law  or  in  equity  is  unreasonable;^   and  under 

1  White  V.  Conn.  Mut.  Life  Ins.  Co.,  C.  Ct.  (W.  D.  Mo.),  7  In.s.  L.  J.  394, 
denying  the  soundness  of  the  opposite  conclusion  arrived  at  in  Farmers'  Ins.  Co. 
V.  Curry,  13  Bush  (Ky.),  312,  where  it  was  held  that  a  similar  statute  of  that 
State  did  not  apply  wliere  parties  warranted,  but  only  where  they  were  silent  upon 
the  subject,  and  following  Chamberlain  v.  Insurance  Co.,  55  N.  H.  249,  and 
Emery  v.  Piscataqua,  &c.  Ins.  Co.,  52  Me.  322,  upon  similar  statutes  in  the  re- 
spective States.  Chamberlain's  case  was  itself  overruled  in  Sleeper  i-.  Insurance 
Co.,  56  N.  H.  401,  so  far  as  it  held  the  statute  to  apply  to  neglects,  mistakes,  and 
misrepresentations  in  the  performance  of  the  conditions  of  the  policy.  It  is  still 
law,  however,  so  far  as  it  held  that  the  statute  applies  to  such  mistakes,  neglects, 
and  misrepresentations  as  occur  in  the  making  of  the  contract.  See  also  Hill  v. 
Equitable  Mut.  Fire  Ins.  Co.  (N.  H.),  6  Ins.  L.  J.  314  ;  Leach  v.  Republic  Fire 
Ins.  Co.,  58  N.  H.  245.     See  also  ante,  §  143,  n. 

2  Southern  Life  Ins.  Co.  v.  Wilkinson,  53  Ga.  536 ;  s.  c.  5  Big.  Life  &  Ace. 
Ins.  Gas.  85  ;  Mobile,  &c.  Ins.  Co.  v.  Coleman,  58  Ga.  251. 

3  Ante,  §  163. 

*  Barre  Boot  Co.  v.  Milford  Mut.  Fire  Ins.  Co.,  7  Allen  (Mass.),  42. 

5  Parsons  v.  Queen  Ins.  Co.  (Can.  Sup.  Ct.),  16  Cau.  L.  J.  244,  18S0 ;  s.  c. 
4  Can.  Sup.  Ct.  Rep.  213.  The  statute  applies  to  foreign  companies  licensed,  but 
not  to  mutual  companies.  Wellington  Mut.  Ins.  Co.  v.  Frey,  3  Leg.  News,  327  ; 
R.  S.  Ont.  c.  162. 

6  May  V.  Standard  Ins.  Co.  (U.  C.  C.  P.),  15  Can.  L.  J.  x.  s.  211. 

357 


§  180  a]      insurance:  fire,  life,  accident,  etc.      [ch.  vii. 

the  condition  requiring  certificate  of  loss  of  magistrate  most 
contiguous  to  the  fire,i  avoiding  policy  if  title  to  property 
shall  be  disputed  in  any  proceeding  at  law  or  in  equity,^  and 
makino-  any  misrepresentation  a  cause  of  forfeiture,  have 
been  held  unreasonable. ^  But  conditions  in  the  charter  of 
a  foreign  insurance  company  are  not  binding  upon  the 
assured,  unless  brought  to  his  notice.* 

1  Shannon  v.  Hastings   Mut.  Ins.  Co.,  2  Ont.  App.  Rep.  81. 

2  Sands  v.  Standard  Ins.  Co.  (U.  C),  27  Grant's  Ch.  167. 

3  Butler  V.  Standard  Fire  Ins.  Co.,  4  Ont.  App.  Rep.  391.  See  also  Ballagh  v. 
Royal  Mut.  Fire  Ins.  Co.,  5  Ont.  App.  Rej).  87. 

*  City  Fire  Ins.  Co.  v.  Carrugi,  41  Ga.  660. 

The  following  graphic  and  masterly  statement  of  the  situation  out  of  which 
grew  the  necessity  of  legislative  interposition,  is  from  the  pen  of  Mr.  Chief  Justice 
Doe,  of  New  Hampshire.  The  learned  Chief  Justice  seems  to  have  said,  in  a  very 
striking  antl  effective  way,  what  many  other  judges  must  have  often  thought. 

"The  nature  of  the  mischief  intended  to  be  remedied  by  the  act  of  1855  has  a 
bearing  upon  the  question  whether,  by  fair  and  reasonable  construction,  it  ap- 
pears that  the  legislature,  having  in  1855  forbidden  all  insurance  companies  to 
commit  such  mischief,  did  actually  intend,  in  1862,  to  confer  on  this  company  the 
exceptional  legal  right  to  commit  the  same  mischief.  The  object  of  the  act  of 
1855  obviously  was,  to  remedy  an  evil  with  which  the  people  of  this  State  had 
^:)ng  believed  themselves  to  be  grievously  afflicted.  Whether  their  belief  had  an 
ample  or  substantial  foundation,  or  any  foundation  at  all  ;  whether  it  was  justified 
by  the  conduct  of  a  considerable  number  of  insurance  companies  ;  or  whether  the 
course  of  a  very  few  brought  an  undeserved  reproach  upon  the  whole  system  of 
insurance,  —  it  is  not  now  necessary  to  inquire.  It  is  the  state  of  things  believed 
to  exist,  and  not  its  real  existence,  that  explains  the  legislation.  The  public 
belief,  manifested  in  the  annals  of  litigation  and  elsewhere,  is  too  notorious  and 
historic  to  require  any  specific  attestation.  The  state  of  things  believed  to  exist 
was  this  :  — 

"  Some  companies,  chartered  by  the  legislature  as  insurance  companies,  were 
organized  for  the  purpose  of  providing  one  or  two  of  their  officers,  at  headquarters, 
with  lucrative  employment,  —  large  compensation  for  light  work,  — not  for 
the  purpose  of  insuring  property  ;  for  the  payment  of  expenses,  not  of  losses. 
Whether  a  so-called  insurance  company  was  originally  started  for  the  purpose  of 
insuring  an  easily  earned  income  to  one  or  two  individuals,  or  whether  it  came  to 
that  end  after  a  time,  the  ultimate  evil  was  the  same.  Names  of  men  of  high 
standing  were  necessary  to  represent  directors.  The  directorship,  like  the  rest  of 
the  institution  and  its  operations,  except  the  collection  of  premiums  and  the 
division  of  the  same  among  the  collectors,  was  nominal.  Men  of  eminent  respec- 
tability were  induced  to  lend  their  names  for  the  official  benefit  of  a  concern  of 
which  they  knew  and  were  expected  to  know  nothing,  but  which  was  represented 
to  them  as  highly  advantageous  to  the  public.  There  was  no  stock,  no  invest- 
ment of  capital,  no  individual  linbility,  no  official  responsibility,  —  nothing  but  a 
formal  organization  for  the  collection  of  premiums,  and  their  appropriation  as 
compensation  for  the  services  of  its  operators. 

"The  principle  act  of  precaution  was,  to  guard  the  company  against  liability 
for  losses.     Forms  of  applications  and  policies  (like  those  used  in  this  case),  of 

358 


CH,  VIII.]    WARKANTIES. — APPLICATION. — CONSTRUCTION.  [§  180  a 

a  most  complicated  and  elaborate  structure,  were  prepared,  and  filled  with  cov- 
enants, exceptions,  stipulations,  provisos,  rules,  regulations,  and  conditions,  ren- 
dering the  policy  void  in  a  great  number  of  contingencies.  These  jjrovisious 
were  of  such  bulk  and  character  that  they  would  not  be  understood  by  men  iu 
general,  even  if  subjected  to  a  careful  and  laborious  study  ;  by  men  in  general, 
they  were  sure  not  to  be  studied  at  all.  The  study  of  them  was  rendered  par- 
ticularly unattractive,  by  a  profuse  intermixture  of  discourses  on  subjects  in 
which  a  premium  payer  would  have  no  interest.  The  comjDound,  if  read  by 
him,  would,  unless  he  were  an  extraordinary  man,  be  an  inexplicable  riddle,  a 
mere  flood  of  darkness  and  confusion.  Some  of  the  most  material  sti[iulations 
were  concealed  in  a  mass  of  rubbish,  on  the  back  side  of  the  policy  and  the 
following  page,  where  few  would  expect  to  find  anything  more  than  a  dull  ap- 
pendix, and  where  scarcely  any  one  would  think  of  looking  for  information  so 
important  as  that  the  company  claimed  a  special  exemption  from  the  operation 
of  the  general  law  of  the  land  relating  to  the  only  business  in  which  the  com- 
pany professed  to  be  engaged.  As  if  it  were  feared  that,  notwithstanding 
these  discouraging  circumstances,  some  extremely  eccentric  person  might  at- 
tempt to  examine  and  understand  the  meaning  of  the  involved  and  intricate 
net  in  which  he  was  to  be  entangled,  it  was  printed  in  such  small  type,  and  in 
lines  so  long  and  so  crowded,  that  the  perusal  of  it  was  -made  physically  diffi- 
cult, painful,  and  injurious.  Seldom  has  the  art  of  typography  been  so  suc- 
cessfully diverted  from  the  diffusion  of  knowledge  to  the  suppression  of  it. 
There  was  ground  for  the  premium  payer  to  argue  that  the  print  alone  was 
evidence,  competent  to  be  submitted  to  a  jury,  of  a  fraudulent  plot.  It  was  not 
a  little  remarkable  that  a  method  of  doing  business  not  designed  to  impose 
upon,  mislead,  and  deceive  him  by  hiding  the  truth,  practically  concealing  and 
misrepresenting  the  facts,  and  depriving  him  of  all  knowledge  of  what  he  was 
concerned  to  know,  should  happen  to  be  so  admirably  ada[)ted  to  that  purpose. 
As  a  contrivance  for  keeping  out  of  sight  the  dangers  created  by  the  agents  of 
the  nominal  corporation,  the  system  displayed  a  degree  of  c\iltivated  ingenuity, 
which,  if  it  had  been  exercised  in  any  useful  calling,  would  have  merited  the 
strongest  commendation. 

"Travelling  agents  were  necessary  to  apprise  people  of  their  opportunities, 
and  induce  them  to  act  as  policy-holders  and  premium  payers,  under  the  name 
of  'the  insured.'  Such  emissaries  were  sent  out.  'The  soliciting  agents  of  in- 
surance companies  swarm  through  the  country,  plying  the  inexperienced  and 
unwary,  who  are  ignorant  of  the  principles  of  insurance  law,  and  unlearned  in 
the  distinctions  that  are  drawn  between  legal  and  equitable  estates.'  Combs  v. 
Hannibal  Savings  &  Ins.  Co.,  43  Mo.  148,  162  ;  6  Western  Insurance  Pieview, 
467,  529.  The  agents  made  personal  and  ardent  application  to  people  to  accept 
policies,  and  prevailed  upon  large  numbers  to  sign  papers  (represented  to  be 
mere  matters  of  form)  falsifying  an  important  fact  by  declaring  that  they  made 
application  for  policies,  reversing  the  first  material  step  in  the  negotiation.  An 
insurance  company,  by  its  agent,  making  assiduous  application  to  an  individual 
to  make  application  to  the  company  for  a  policy,  was  a  sample  of  the  crooked- 
ness characteristic  of  the  whole  business. 

"  When  a  premium  payer  met  with  a  loss,  and  called  for  the  payment  prom- 
ised in  the  policy  which  he  had  accepted  upon  the  most  zealous  solicitation,  he 
was  surprised  to  find  that  the  voluminous,  unread,  and  unexplained  papers  had 
been  so  printed  at  headquarters,  and  so  filled  out  by  the  agents  of  the  company, 
as  to  show  that  he  had  applied  for  the  policy.  This,  however,  was  the  least  of 
his  surprises.     He  was  informed  that  he  had  not  only  obtained  the  policy  on  his 

359 


§  180  rt]         INSURANCE  :    FIKE,   LIFE,    ACCIDENT,    ETC.       [CH.  YIII. 

own  application,  but  had  obtained  it  by  a  series  of  representations  (nf  which  he 
had  not  the  slightest  conception),  and  had  solemnly  bound  himself  by  a  general 
assortment  of  covenants  and  warranties  (of  which  he  was  unconscious),  the  num- 
ber of  which  was  ecjualled  only  by  their  varietj',  and  the  variety  of  which  was 
equalled  only  by  their  sujiposed  capacity  to  defeat  every  claim  that  could  be  made 
upon  the  company  for  the  performance  oi  its  part  of  the  contract.  He  was  fur- 
ther informed  that  he  had  succeeded  in  his  application  by  the  falsehood  and  fraud 
of  his  representations,  —  the  omission  and  misstatement  of  facts  which  he  had 
expressly  covenanted  tnithfuUy  to  disclose.  Knowing  well  that  the  application 
was  made  to  him,  and  that  he  had  been  cajoled  by  the  skilful  arts  of  an  importu- 
nate agent  into  the  acceptance  of  the  policy  and  the  signing  of  some  paper  or 
other,  with  as  little  understanding  of  their  effect  as  if  they  had  been  printed  in 
an  unknown  and  untranslated  tongue,  he  might  well  be  astonished  at  the  inverted 
application,  and  the  strange  multitude  of  fatal  representations  and  ruinous  cove- 
nants. But  when  he  had  time  to  realize  his  situation,  —  had  heard  the  evidence 
of  his  having  beset  the  invisible  company,  and  obtained  the  policy  by  just  such 
means  as  those  by  which  he  knew  he  had  been  induced  to  accept  it,  and  listened 
to  the  proof  of  his  obtaining  it  by  treachery  and  guilt,  in  pursuance  of  a  premedi- 
tated scheme  of  fraud,  with  intent  to  swindle  the  company  in  regard  to  a  lien  for 
assessments,  or  some  other  matter  of  theoretical  materiality,  —  he  was  measure- 
ably  prepared  for  the  next  regular  charge  of  having  burned  his  own  property. 

"With  increased  experience  came  a  constant  expansion  of  precautionary 
measures  on  the  part  of  the  companies.  When  the  court  held  (Marshall  i'.  C.  M. 
F.  I.  Co.,  27  N.  H.  157  ;  Campbell  v.  M.  &  F.  M.  F.  I.  Co.,  37  id.  35  ;  Clark  v. 
U.  M.  F.  I.  Co.,  40  id.  333)  that  the  agent's  knowledge  of  facts  not  stated  in  the 
application  was  the  com]iany's  knowledge,  and  that  an  unintentional  omission  or 
misrepresentation  of  facts  known  to  the  company  would  not  invalidate  the  policy, 
the  companies,  by  their  agents,  issued  new  editions  of  applications  and  policies, 
containing  additional  stipulations  to  the  effect  that  their  agents  were  not  their 
agents,  but  were  the  agents  of  the  premium  payers  ;  that  the  latter  were  alone 
responsible  for  the  correctness  of  the  applications,  and  that  the  companies  were 
not  bound  by  any  knowledge,  statements,  or  acts  of  any  agent,  not  contained  in 
the  application.  As  the  companies'  agents  filled  the  blanks  to  suit  themselves, 
and  were  in  that  matter  necessarily  trusted  by  themselves  and  by  the  premium 
payers,  the  confidence  which  they  reposed  in  themselves  was  not  likely  to  be 
abused  by  the  insertion  in  the  applications  of  any  unnecessary  evidence  of  their 
own  knowledge  of  anything,  or  their  own  representations,  or  their  dictation  and 
management  of  the  entire  contract  on  both  sides.  Before  that  era,  it  had  been 
understood  that  a  corporation  —  an  artificial  being,  invisible,  intangible,  and  ex- 
isting only  in  contemplation  of  law  —  was  capable  of  acting  only  by  agents.  But 
corporations,  pretending  to  act  without  agents,  exhibited  the  novel  phenomena  of 
anomalous  and  nondescript  as  well  as  imaginary  beings,  with  no  visible  principal 
or  authorized  representative  ;  no  attribute  of  personality  subject  to  any  law,  or 
bound  by  any  obligation  ;  and  no  other  evidence  of  a  practical,  legal,  physical,  or 
psychological  existence  than  the  collection  of  premiums  and  assessments.  The 
increasing  number  of  stipulations  and  covenants,  secreted  in  the  usual  manner, 
not  being  understood  by  the  premium  payer  until  his  property  was  burned, 
people  were  as  easily  beguiled  into  one  edition  as  another,  until  at  last  they  were 
made  to  formally  contract  with  a  phantom  that  carried  on  business  to  the  limited 
extent  of  absorbing  cash  received  by  certain  persons  who  were  not  its  agents. 

"  When  it  was  believed  that  things  had  come  to  this  pass,  the  legislature 
thought  it  time  to  regulate  the  business  in  such  a  manner  that  it  should  have  some 
360 


CII.  VIII.]    WARRANTIES. — APPLICATION.— CONSTRUCTION.   [§  180  « 

title  to  the  name  of  insurance,  and  some  appearance  of  fair  dealing;   and  the  act 
of  1855  was  passed  for  that  purpose. 

"  The  loss  of  the  time  occupied  by  the  solicitations  of  insurance  agents,  the 
lo.ss  of  premiums  and  assessments  paid,  tlie  loss  of  insurance  security,  the  vexation 
and  cost  of  lawsuits  lost  upon  the  astute  and  technical  character  of  applications 
and  policies  not  understood  by  the  premium  payers,  the  manner  in  which  inno- 
cent and  deluded  persons  were  overwhelmed  by  an  array  of  their  theoretical 
misrepresentations  and  constructive  frauds,  and  other  misfortunes  incident  to  the 
system,  were  believed  to  constitute  a  crying  evil,  and  a  mischief  of  great  magni- 
tude. (Whether  any  remedy  was  available  at  common  law  or  in  equity,  upon 
higher  grounds  and  broader  views  than  were  taken,  —  U.  M.  L.  Ins.  Co.  v.  Wil- 
kinson, and  note  on  that  case  in  11  Am.  Law  Reg.  N.  s.  485,  —  we  need  not,  in 
this  construction  of  statutes,  stop  to  consider.)  When  the  premium  payer  com- 
plained that  he  had  been  defrauded,  it  was  not,  in  the  opinion  of  the  legislature, 
a  sufficient  answer  to  say  that  if  he  had  been  wise  enough,  taken  time  enough, 
had  good  eyes  enough,  and  been  leckless  enough  in  the  use  of  them  to  read  the 
mass  of  tine  print,  and  had  been  scholar,  business  man,  and  lawyer  enough  to 
understand  its  full  force  and  effect,  he  would  have  been  alarmed,  and  would  not 
have  been  decoyed  into  the  trap  that  was  set  for  him.  Men  have  a  right  to  be 
dealt  with  with  some  regard  for  the  state  of  mind  and  body,  of  knowledge  and 
business,  in  which  they  are  known  actually  to  exist.  Whether  they  ought  to  be 
what  they  are,  or  not,  the  fact  is,  that  in  the  present  condition  of  society  men  in 
general  cannot  read  and  understand  these  insurance  documents.  Whether  it  be 
reliance  upon  the  representations  of  the  companies'  agents,  or  want  of  taste  for 
literary  pursuits  and  critical  exegesis,  or  defect  of  legal  attainments,  or  press  of 
business,  or  fatigue  of  daily  labor,  or  dislike  of  insurance  topography,  —  whatever 
the  cause  may  be,  the  fact  is,  that  under  the  ordinary  circumstances  of  the 
present  order  of  things,  these  documents  are  illegible  and  unintelligible  to  the 
generality  of  mankind.  And  it  seemed  to  the  legislatuie  that  the  companies 
who  sent  out  their  agents,  knowing  they  would  be  confided  in  by  the  premium 
payers  to  transact  the  business  properly,  and  who  issued  applications  and  policies 
which  they  knew  would  not  be  understood,  should  not  take  an  unfair  advantage 
of  mistakes  into  which  the  companies  themselves,  by  their  agents  and  their  tine 
pi'int,  caused  the  premium  payers  to  innocently  and  unconsciously  fall.  The 
action  of  the  legislature  was  certainly  in  harmony  with,  if  indeed  it  was  anything 
more  than  an  affirmance  of,  the  common  law  (in  relation  to  fraud,  estoppel,  and 
trust),  which  will  not  hear  a  man  complain  that  he  has  led  his  neighbor  into  a 
pit.  It  was  also  thought  that  insurance  companies,  in  danger  of  being  defrauded 
by  the  prenuum  payer's  burning  his  own  property,  were  required,  by  their  private 
interest  and  theii-  public  duty  to  see  to  it  that  they  did  not  insure  his  property  to 
such  an  amount  as  to  lead  him  into  temptation  ;  and  that  their  devices  were  not 
a  prevention  of,  nor  an  appropriate  protection  against,  the  fraudulent  incendiarism 
propagated  throughout  the  country  by  excessive  amounts  of  pretended  insurance. 
"  As  the  distress  of  those  who  met  with  losses  was  not  alleviated  bj'^  the  emi- 
nent respectability  of  the  men  whose  names  figured  as  officers  of  the  companies,  so 
it  was  the  nature  of  a  system  so  liable  to  abuse,  and  not  the  character  of  the  nom- 
inal or  real  managers  of  the  companies,  that  was  supposed  to  call  for  the  interfer- 
ence of  the  legislature.  With  no  fault  in  many,  and  probably  with  substantial 
fault  iii  but  a  few,  the  system  came  to  be  excessively  odious.  It  was  believed  there 
had  seldom  been  so  flagrant  an  abuse  of  corporate  power.  The  act  of  1855  ctits 
up  a  considerable  portion  of  the  supposed  evil  by  the  roots."  De  Lancey  v. 
Rockingham  Mut.  Fire  Ins.  Co.,  52  N.  H.  581.     See  also  post,  §  185. 

361 


INSURANCE  :    FIKE,  LIFE,   ACCIDENT,   ETC.         [CH.  IX. 


CHAPTER  IX. 

REPRESENTATION. 

Analysis. 

§  181.  Defiuition.     A  representation  is  a  statement  incidental  to  the  con- 

tract, and  on  the  faith  of  which  it  is  made.  A  material  mis- 
representation made  knowingly  or  recklessly  {i.  e.,  without 
sufficient  reason  to  convince  a  man  of  ordinary  prudence  (see 
§  185),  and  properly  relied  on,  avoids  the  policy,  unless  there 
was  no  intentional  fraud  and  the  policy  contains  limiting 
words  such  as  "  so  far  as  known,"  or  "designedly  untrue," 
&c.,  or  the  misrepresentation  was  induced  by  the  fault  of  the 
company  or  its  agent  (see  §  188  F). 
by  the  Massachusetts  Public  Statutes  721,  the  misrepresenta- 
tion, to  be  fatal,  must  not  only  be  material  but  made  with 
actual  intent  to  deceive.  This  is  not  so  just  and  wholesome 
a  rule  as  that  of  the  common  law. 
§  182.  Affirmative  and   promissory  representations.      The  former  may  be 

oral  (§  192)  ;  the  latter,  if  not  in  writing,  will  be  of  no  effect  un- 
less made  mala  fide.     If  the  former  fails,  no  contract  comes  into 
existence,  but  the  latter  may  fail  temporarily  and  merely  suspend 
the  policy,  or  entirely  destroy  it  (§  194). 
§  183.  Distinction  between  warranty  and  representation.     The  first  is  put 

into  the  policy  and  foims  part  of  the  contract,  the  latter  is 
not  a  part  of  the  contract  but  forms  the  basis  of  it,  or  is  col- 
lateral to  it. 
§§  184-188.  Substantial  fulfilment  of  material   representations   is   enough 

(§§  184-188,  see  examples,  §  198),  but  warranties  whether 
material  or  not  must  be  literally  complied  with  (see  as 
to  meaning  of  substantial  compliance  §  198,  good  faith 
and  practical  ecpiivalence,  §  199 ;  as  to  substantial  com- 
pliance with  warranty,  see  §  157).  The  test  of  materi- 
ality is  this,  —  is  the  representation  such  as  will  naturally 
and  probably  influence  the  insurer  in  determining 
whether  to  take  the  risk  or  not,  and  what  prenuum 
to  charge?  (§§  184,  195,  196,  197.)  If  it  had  no  in- 
fluence or  ought  to  have  had  none,  it  is  immaterial 
(§  184).  The  question  is  usually  for  the  jury  (§§  184, 
195) ;  though  sometimes  for  the  court  (§  185) ;  and 
sometimes  both  court  and  jury  are  excluded  by  a  deter- 
mination of  the  question  by  the  parties  themselves.  A 
clear  agreement  that  the  falsity  of  any  statement  in  the 
application  shall  avoid  the  policy,  has  this  effect  (§  185), 
and  making  the  point  a  subject  of  question  and  answer 
amounts  to  such  agreement  (§§  185-187). 

362 


CH.  IX.]  KEPKESENTATION. 

Even  iu  such  cases  however,  the  statements  do  not  rise  to 
the  dignity  of  warranties,  and  substantial  fultilnieut  is 
still  sufficient  (§§  186,  197),  and  nothing  less  than  sub- 
stantial compliance  will  do;  no  fulfilment  of  the  letter 
and  violation  of  the  spirit  will  be  allowed,  as  is  some- 
times the  case  with  warranties  (§  19y).  Although  the 
question  of  materiality  is  closed  by  question  and  answer, 
the  truth  of  the  answer  is  still  for  the  jury  (§  187,  3rd 
paragraph),  e.  y.,  did  a  certain  disease  exist  so  that  a 
negative  was  substantially  untrue  (§  187).  "Watch- 
man when  mill  not  in  use"  (§  188). 
In  Canada  an  agreement  which  makes  the  policy  void  for 
incorrect  statements  without  reference  to  materiality  is 
deemed  unjust  and  unreasonable  (§  185). 
There  is  little  sense  in  the  distinction  between  warranty 
and  representation.  As  to  materiality  there  is  already 
no  difference  in  principle.  If  the  parties  treat  a  repre- 
sentation as  material  the  law  deems  it  so.  In  case  of 
warranties,  by  their  very  nature  the  parties  have  always 
treated  the  statement  as  material.  The  other  attempted 
distinction  between  literal  and  substantial  fulfilment  is 
not  just,  and  the  courts  have  begun  to  break  over  it. 
Substantial  fulfilment  according  to  the  circumstances  and 
the  nature  of  the  case,  should  always  he  sujficient.  (8ee 
§§  157,  161,  185,  223.)  E(iuity  looks  to  the  substance. 
§  188  A.  Examples  of  fatal  misrepresentations;   mortgage  2,000  instead  of 

3,000;  place  of  goods, 
occupation  at  time  of  application  must  be  given,  not  that  of 

years  before.     See  also  §  306. 
other  insurance  understated, 
age. 
where  policy  says  false  answers  to  written  questions  will  avoid 

it,  false  answers  to  oral  questions  will  also,  §  188  A. 
infant  owner  said  to  be  widow,  §  185. 
§  188  B.  Disputed  representations  not  fatal : 

if  the  risk  is  less  on  the  truth  than  on  the  misrepresentation, 

the  policy  is  not  void, 
"beneficiary  a  dependent,"  immaterial, 
deed  ownership  said  to  be  under  will  immaterial, 
"sliip  shall  sail  in  ballast,"  a  few  goods  unknown  to  assured, 

immaterial, 
representations  not  material  nor  wilful,  not  fatal. 
"no  spirits  allowed  on  board"  excludes  only  their  use,  not 

freight,  §  188  B. 
and  see  three  following  sections. 

if  representation  does  not  induce  the  contract  it  is  not  mate- 
rial, §  197. 
§  188  C.  "When  built"  means  year  of  construction,  though  part  of  mate- 

rials old. 
usage  that  the  question  refers  only  to  houses  all  of  new  stuff, 

inadmissible, 
wrong  date  immaterial  if  house  no  worse  for  age. 

363 


§  181]  INSUKANCE;    FIRE,  LIFE,   ACCIDENT,   ETC.  [CH.  IX. 

A  knowingly  false  answer  as  to  other  applications  is  fatal,  Lut  "no 
former  Application  "  is  a  true  answer,  though  an  application  had 
been  made  but  not  passed  on;  see  §  215. 
Value. 

honest  answer  to  ambiguous  question  sufficient, 
matter  of  opinion,  only  good  faith  required,  unless  the  state- 
ment of  value  is  made  part  of  contract. 
§  188  D.  Expression   of  belief,    expectation,    or   intention   not   fatal   unless 

dishonest. 
day  a  vessel  is  expected  to  sail. 
Reasonable  grounds  for  belief  is  enough. 
The  law  will  not  presume  a  misrepresentation. 
§  188  E.  Statement  made  expressly  on  the  authority  of  others  not  fatal. 

Representation   may   be   withdrawn    or   qualified    before   policy   is 
issued. 
§  188  F.  The  company's  representations   in   a  pamphlet   shown   to   one   to 

induce  him  to  insure  bind  company. 
If  misrepresentations  of  the  agent  induce  the  misrepresentations 
of  the  assured  the  company  is  held. 
§  189.  A  representation  though  false  as  to  only  a  portion  of  the  subject  it 

covers,  generally  avoids  the  entire  contract,  but  a  misrepresenta- 
tion in  good  faith  as  to  ownership  of  real  estate  is  not  fatal  as  to 
the  personal  property,  though  the  premium  is  a  gross  sum  (as  it 
usually  is  in  more  senses  than  one). 
§  190,  Effect  of  change  during  negotiations.     Although  a  representation  be 

true  when  made,  yet  if  untrue  when  the  contract  is  completed, 
the  latter  is  void.  Health  changing  to  illness.  A  new  policy 
issued  by  another  comi)any  on  the  old  risk,  however,  does  not 
assume  the  continuance  of  the  representations.  In  case  of  a 
renewal,  qucere. 
§  191.  A  change  after  completion  of  the  contract  is  immaterial.     Use  and 

circumstances  of  a  building  need  not  continue  the  same  unless 
expressly  so  agreed.  An  answer  as  to  the  present  status  is  held 
not  to  promise  continuam;e.  (See  also  §§  231,  247,  248.)  Where 
however  the  question  could  have  no  other  purjiose,  and  good  faith 
would  not  allow  change,  the  law  ought  not  to  countenance  it. 
Good  faith  is  part  of  every  agreement  whether  its  requirements 
are  expressed  or  not;  see  §§  157,  244,  250-252. 
§  192.  If  there  is  a  written  application,  prior  or  subsequent  oral  state- 

ments become  immaterial.     All   representations  are   merged   in 
the  writing. 
§  193.  Equivocal  words,  —  "  cotton  rags  ; "   "  leased  or  rented." 

See  further,  §§  250-263. 

§  181.  Representation  defined.  —  A  representation  is  a 
statement  incidental  to  the  contract,  relative  to  some  fact 
having  reference  thereto,  and  upon  the  faith  of  which  the 
contract  is  entered  into.  If  false  and  material  to  the  risk, 
the  contract  is  avoided.  Such  a  false  statement  is  termed 
in  insurance  a  misrepresentation,  which  has  been  well  de- 
364 


CH.  IX.]  HEPRESENTATION.  [§  182 

fined  to  be  the  statement  of  something  as  fact  which  is 
untrue  in  fact,  and  which  the  insured  states  knowing  it  to 
be  untrue,  with  the  intent  to  deceive  the  insurers,  or  which 
he  states  positively  as  true  without  knowing  it  to  be  true,  and 
which  has  a  tendency  to  mislead,  —  such  fact,  in  either  case, 
being  material  to  the  risk  and  adverse  to  the  insurers.  ^  (a) 

The  general  doctrine  undoubtedly  is,  that  a  misrepresen- 
tation, whether  made  intentionally  or  through  mistake  and 
in  good  faith,  avoids  the  policy,  on  the  ground  that,  in 
either  case,  the  injury  to  the  insurer  is  the  same.  It  is  the 
fact  that  the  insurer  relies  upon  the  truth  of  the  representa- 
tion, and  not  upon  the  intention,  which  misleads,  whether 
fraudulent  or  otherwise,  that  gives  him  the  right  to  com- 
plain. And  the  same  doctrine  has  been  frequently  held 
with  reference  to  concealment,  but  perhaps  with  less  rea 
son,  as  to  which,  however,  we  shall  see  more  particularly 
hereafter.2     But  a  simply  untrue  statement  is  not  a  "pal- 

1  Daniels  et  al.  v.  Hudson  River  Fire  Ins.  Co.,  12  Cush.  (Mass.)  416  ;  Camp- 
bell V.  New  England  Mut.  Life  Ins.  Co.,  98  Mass.  381  ;  Nieol  v.  Am.  Ins.  Co., 
3  W.  &  M.  (U.  S.  C.  Ct.)  529. 

2  Post,  ell.  viii.  See  also  Bj^ers  v.  Farmers'  Ins.  Co.  (Ohio),  9  Ins.  L.  J.  743  ; 
Attorney-General  v.  Ray,  L.  R.  9  Ch.  397. 

(a)    Representations   in   relation   to  ^Etna  F.  Ins.  Co.  (N.  Y.),  16  Am.  Dec. 

warranties  are  considered  supra  in  the  460,    463,   n.      When  the    policy  does 

notes  to  §§  156,  159.     The  powers  of  not  make  the  application  a  part  of  the 

insurance   agents   are   not   aflected   by  contract  and  contains  no  warranty  as  to 

the   question  whether   ttie   application  the  truth  of  .statements  in  the  applica- 

contains  warranties  or  only  representa-  tion,   such   statements  will    not   defeat 

tions.       Mutual    Ben.    L.    Ins.   Co.    v.  the  policy  unless  both  material  and  un- 

Robison,  58   Fed.   Rep.  723.     A  repre-  true,  and  the  question  is  one  of  fact  for 

sentation  is  not   necessarily  a  part  of  the  jury.     Fidelity  &  Casualty  Co.  v. 

the   contract   of    insurance,    or    of    its  Alpert,    67    Fed.  Rep.    460.     Where   a 

essence  ;  but,  as  it  is  rather  something  check  mark  was  made  opjiosite  various 

collateral    or  preliminary,    and   in    the  questions  in  the  application,  which  were 

nature  of  an  inducement  to  it,  it  should  apparently  immaterial  because  answered 

in  general,  by  some  phraseology  of  the  in  previous  questions,  such  mark  cannot 

policy,  be  made  part  thereof.     A  false  be  construed  as  a  negative  answer  to  the 

representation,  unlike  a  false  warranty,  question  whether  any  prior  application 

does  not  vitiate  the  contract  or  avoid  for  insurance  had  been  made  on  which 

the  policy,  unless  it  relates  to  a  fact  no  policy  was  issued  ;  and  when  a  policy 

actually  material,  or  clearly  intended  to  is   issued  upon    such   application,   im- 

be  made  material,  by  the  agreement  of  perfect   or    unsatisfactory   answers    are 

the  parties.     Weil  v.  New  York  L.  Ins.  waived.      Manhattan    L.    Ins.    Co.    v. 

Co.  (La.),  24  Ins.  L.  J.  641  ;  Fowler  v.  Willis,  60  Fed.  Rep.  236. 

365 


§182]         insurance:  fire,  life,  accident,  etc.        [ch.  ix. 

pably  fraudulent  or  untrue  "  one ;  ^  and  good  faith  is  always 
sufiicient,  when  the  policy  provides  only  for  truth  "so  far 
as  is  known  to  the  applicant,"  ^  or  against  "designedly  un- 
true "  statements. 3  The  responsibility  for  misrepresenta- 
tions is  not,  however,  confined  to  those  contained  in  the 
application,  under  a  provision  that  such  misrepresentations 
shall  avoid  the  policy.  Any  other  misrepresentation  made 
at  the  time  is  equally  fatal.* 

§  182.  Affirmative  and  Promissory.  —  Representations,  like 
warranties,  may  be  affirmative  or  promissory.  The  former 
are  those  which  affirm  the  existence  of  a  particular  state  of 
things  at  the  time  the  contract  of  insurance  is  made  and 
becomes  operative.  The  latter  are  those  which  are  made  by 
the  assured  concerning  what  is  to  happen  during  the  term 
of  the  insurance,  stated  as  matters  of  expectation,  or,  it 
may  be,  of  contract.  The  one  is  an  affirmation  of  a  fact 
existing  when  the  contract  begins;  the  other  is  a  promise 
to  be  performed  after  the  contract  has  come  into  existence. 
And  upon  this  distinction  follows  the  important  consequence 
that,  while  material  falsity  in  an  affirmative  representation 
will  be  a  complete  defence  to  an  action  on  a  policy  of  insur- 
ance, the  material  falsity  of  an  oral  promissory  representa- 
tion without  fraud  is  no  defence  whatever.  And  the  reason 
of  the  distinction  is  this.  The  falsehood  of  the  representa- 
tion of  a  material  fact  misleads  the  insured  into  a  contract 
which  he  does  not  intend  to  make,  and  therefore,  in  con- 
templation of  law,  because  misled  and  deceived,  does  not 
make.  He  may  therefore  set  up  the  fact  that  he  was  misled 
or  deceived,  as  proof  that  no  agreement  was  ever  made,  since 
there  was  no  concurrence  of  consent  upon  the  same  facts. 
But  an  oral  promissory  representation,  being  an  agreement 
prior  in  date  to  the  actual  contract  of  insurance,  and  in  its 
nature  such  that  it  cannot  be  performed  until  after  the  con- 
tract of  insurance  has  taken  effect,  cannot  be  set  up  to  de- 

*  Guinane  v.  Hope  Mut.  Life,  &c.  Soc,  7  Irish  Jur.  o.  s.  119. 

*  Garcelon  v.  Hampden  Fire  Ins.  Co.,  50  Me.  580. 

S  Fowkes  V.  Manchester  &  Lan.  Assur.  Assoc,  3  B.  &  S.  917. 

*  Wainwrignt  v.  Bland,  2  Mad.  &  Rob.  481  ;  s.  c.  1  Mees.  &  Wels.  32 ;  Ab- 
hott  V.  Howard,  Hayes  (Irish),  381. 

366 


CH.  IX.]  REPRESENTATION.  [§  183 

feat  the  later  contract;  for  this  would  be  to  violate  a 
fundamental  rule  of  evidence,  and  make  the  continuance  or 
maintenance  of  a  written  contract  dependent  upon  the  per- 
formance or  breach  of  an  earlier  oral  agreement.  If  the 
oral  promise  be  made  7nala  fide,  and  with  the  intention  to 
mislead  and  deceive,  the  fraud  will  have  the  same  effect  as 
the  material  falsity  of  an  affirmative  representation.  But  if 
made  bona  fide  and  without  intention  to  mislead  or  deceive, 
it  cannot  be  set  up  to  avoid  a  contract.  ^  Only  those  promis- 
sory representations  are  available  for  such  a  purpose  which 
are  reduced  to  writing  and  made  part  of  the  contract,  —  thus 
becoming  substantially,  if  not  formally,  warranties. 2 

§  183.  Distinction  between  Warranty  and  Representation.^ 
—  The  main  distinction  between  a  warranty  and  a  represen- 
tation —  that  while  the  former  is  an  agreement  constituting 
a  part  of  the  contract,  the  latter  is  but  a  statement  inci- 
dental thereto  —  is  to  be  carefully  observed,  as  it  carries 
with  it  important  consequences.*     A  warranty  enters  into 

1  [For  example,  the  failure  of  company  A.  to  keep  a  $10,000  risk  on  the  life 
of  C.  as  it  promised  company  B.  to  do,  in  order  to  induce  B.  to  reinsure  the 
remainder  of  the  risk  then  held  by  A.  on  the  life  of  C,  is  no  ground  of 
defence  to  recovery  on  the  policy.  Prudential  Ass.  Co.  v.  Mtna  L.  Ins.  Co., 
52  Conn.  576.  Failure  to  comply  with  an  oral  promissory  representation  made 
before  the  policy  was  issued  without  fraud,  is  not  a  valid  defence  to  liability  on 
the  policy.     Prudential  Ass.  Co.  v.  MtuA  L.  Ins.  Co.,  23  Blatch.  223.] 

2  Kimball  v.  iEtna  Ins.  Co.  et  al.,  9  Allen  (Mass.),  540  ;  Kimball  v.  Spring- 
field Fire  &  Mar.  Ins.  Co.,  id.  This  distinction  has  not  met  the  approbation  of 
some  learned  writers.  See  1  Arnould,  Ins.  498  ;  2  Duer,  Ins.  749  ef.  seq .;  1 
Phil.  Ins.  §  533.  But  the  opinion  by  Jlr.  Justice  Gray  in  the  cases  cited  will  be 
likely  to  command  the  assent  of  the  profession.  It  is  a  learned,  clear,  and 
satisfactory  statement  of  the  distinction  referred,  and  the  reasons  upon  which 
it  rests.     And  see  post,  §  192. 

3  [Statements  will  bo  held  to  be  representations  and  not  warranties  if  such  a 
construction  is  possible.     See  §§  159,  162,  164,  170-171.] 

*  [In  contracts  of  insurance  a  representation  differs  from  a  warranty  and 
from  a  condition  expressed  in  the  policy  in  that  the  former  is  part  of  the  pre- 
liminary proceedings  which  propose  the  contract,  and  the  latter  is  a  part  of  the 
contract  when  completed.  Glendale  Woolen  Co.  v.  Protection  Ins.  Co.,  21  Conn. 
19,  32.  The  validity  of  the  entire  contract  depends  upon  the  truth  or  fulfilment 
of  the  warranties  and  conditions  expressed  therein,  and  non-compliance  is  a  breach 
of  the  contract  which  makes  it  void  ;  but  a  misrepresentation  to  avoid  the  policy 
must  have  been  in  a  material  matter  or  have  been  made  with  fraudulent  intent. 
A  plea  may  allege  non-compliance  with  a  condition  and  be  good.  But  if  only  a 
representation,  an  allegation  must  be  made  that  it  was  material  or  fraudulently 
made.     Dewees  v.  Manhattan  Ins.  Co.,  34  N.  J.  244,  247,  248,  251.] 

367 


§183]         insurance:  fire,  life,  accident,  etc.  [ch.  ix. 

and  forms  a  part  of  the  contract  itself.  It  defines  bj  way 
of  particular  stipulation,  description,  condition,  or  other- 
wise, the  precise  limits  of  the  obligation  which  the  insurers 
undertake  to  assume.  No  liability  can  arise  except  within 
those  limits.  In  order  to  charge  the  insurers,  therefore, 
every  one  of  the  terms  which  define  their  obligation  must 
be  satisfied  by  the  facts  which  appear  in  proof.  From  the 
very  nature  of  the  case  the  party  seeking  his  indemnity  must 
bring  his  claim  within  the  provisions  of  the  instrument  he 
is  undertaking  to  enforce.  The  burden  of  proof  is  upon  him 
to  present  a  case  in  all  respects  conforming  to  the  terms 
under  which  the  risk  was  assumed.  And  it  is  sometimes 
said  that  it  must  not  be  merely  a  substantial  conformity, 
but  exact  and  literal,  not  only  in  material  particulars,  but 
in  those  that  are  immaterial  as  well.^  On  the  other  hand,  a 
representation  is,  in  its  nature,  no  part  of  the  contract.  Its 
relation  to  the  contract  is  usually  described  by  the  term 
"collateral."  It  may  be  proved,  although  existing  only  in 
parol  and  preceding  the  written  instrument.  Unlike  other 
verbal  negotiations,  it  is  not  merged  in  or  waived  by  the 
subsequent  writing.  This  principle  is  in  some  respects 
peculiar  to  insurance,  and  rests  upon  other  considerations 
than  the  rule  which  admits  proof  of  verbal  representations 
to  impeach  written  contracts  on  the  ground  of  fraud.  Rep- 
resentations to  insurers,  before  or  at  the  time  of  making  the 
contract,  are  a  presentation  of  the  elements  upon  which  to 
estimate  the  risk  proposed  to  be  assumed.  They  are  the 
basis  of  the  contract,  — its  foundation,  on  the  faith  of  which 
it  is  entered  into.  If  wrongly  presented  in  any  respect 
material  to  the  risk,  the  policy  that  may  be  issued  there- 
upon will  not  take  effect.  To  enforce  it  would  be  to  apply 
the  insurance  to  a  risk  that  was  never  presented.  But  where 
the  insurer  seeks  to  defeat  a  policy  upon  this  ground,  his 
position  in  court  is  essentially  different  from  that  which  he 
may  hold  under  a  policy  containing  a  like  description  of  the 
risk  as  one  of  its  terms.  It  is  sufficient  for  the  plaintiff  to 
show  fulfilment  of  all  the  conditions  of  recovery  which  are 

^  But  see  ante,  §  16-1  et  seq.,  diuA  post,  §  186. 

368 


CH.  IX.]  REPRESENTATION.  [§  184 

made  such  by  the  contract  itself.  The  burden  is  then 
thrown  upon  the  defendant  to  set  forth  and  prove  the  un- 
truthfuhiess  of  the  representations,  if  there  are  any  such, 
upon  which  he  relies,   and  their  materiality  to  the  risk.^ 

§  184.  Materiality.  —  Out  of  this  distinction  arises  the 
question  of  materiality.  Representations  need  not,  like 
warranties,  be  strictly  and  literally  complied  with,  but  only 
substantially  and  in  those  particulars  which  are  material  to 
be  disclosed  to  the  insurers  to  enable  them  to  determine 
whether  they  will  enter  into  the  contract,  and  upon  what 
terms.  In  case  of  warranty  the  question  of  materiality  does 
not  arise.  In  case  of  representation  it  always  does;^  and  if 
this  materiality  depends  upon  facts  and  circumstances,  it  is 
a  question  for  the  jury,  to  be  inferred  from  those  facts  and 
circumstances,^  as  is  also  the  materiality  of  a  concealment* 
The  test  of  the  materiality  of  a  misrepresentation  or  con- 
cealment is,  that  it  influences  the  insurer  in  determining 
whether  to  accept  the  risk,  and  what  premium  to  charge.^ 
[A  misrepresentation  is  material  under  Pub.  Sts.  c.  119, 
ss.  138-139,  181,  if  it  increases  the  risk  of  loss,  although 
not  intended  to  deceive.^  («)] 

1  Campbell  v.  Xew  Etigland  :\Iut.  Life  Ins.  Co.,  98  Mass.  381  ;  Price  v.  Phoe- 
nix Life  Ins.  Co.,  17  iliuu.  497  ;  Miller  v.  Mut.  Benefit  Life  Ins.  Co.,  31  Iowa, 
216  ;  N.  Y.  Life  Ins.  Co.  v.  Graham,  2  Duv.  (Ky.)  506.  [The  onus  is  on  the 
company  alleging  untruth  of  answers,  to  show  what  the  application  contains, 
and  until  this  is  done  the  plaintiff  is  not  called  on  to  prove  the  truth  of  his 
statements.     Roach  v.  Ky.  Mut.  Security  Fund  Co.,  28  S.  C.  431.] 

2  [In  the  absence  of  an  express  stipulation  to  the  contrary,  misrepresentations 
to  avoid  the  policy  must  be  material.    Mosley  v.  Insurance  Co.,  55  Vt.  142,  151.] 

3  Garcelon  v.  Hampden  Fire  Ins.  Co.,  50  Me.  580  ;  Mut.  Ins.  Co.  v.  Deale, 
18  Md.  26  ;  Keeler  v.  Niagara  Fire  Ins.  Co.,  16  Wis.  523  ;  Farmers'  Ins.  &  Loan 
Co.  V.  Snyder,  16  "Wend.  (N.  Y. )  481 ;  Daniels  et  al.  v.  Hudson  Eiver  Fire  Ins. 
Co.,  12  Cash.  (Mass.)  416  ;  Franklin  Ins.  Co.  v.  Coates,  14  Md.  285. 

*  Tj^er  V.  .Etna  Ins.  Co.,  12  Wend.  (N.  Y.)  507  ;  Protection  Ins.  Co.  v.  Har- 
mer,  22  Ohio  (2  Ohio  St.),  452  ;  Insurance  Co.  v.  Chase,  5  Wall.  (U.  S.)  509  ; 
Tesson  v.  Atlantic  Mut.  Ins.  Co.,  40  Mo.  33  ;  Curry  v.  Commonwealth  Ins.  Co., 
10  Pick.  (Mass.)  535  ;  Gates  v.  Madison  County  Mut.  Ins.  Co.,  1  Seld.  (N.  Y.) 
469  ;  Mut.  Ins.  Co.  v.  Deale,  18  Md.  26. 

5  Ryan  v.  Springfield,  &c.  Ins.  Co.,  46  "Wis.  671.  [If  the  misrepresentation 
had  no  influence  or  ought  to  have  had  none  on  the  risk,  it  is  immaterial.  Clason 
V.  Smith,  3  "Wash.  156,  157.] 

6  [Ring  V.  Phcenix  Ass.  Co.,  145  Mass.  426.] 

(a)  See  Davis  v.  ^tna  Mut.  F.  Ins.  Co.,  63  X.  H.  315. 

VOL.  I.— 24  369 


§  185]  INSUKANCE  :    FIRE,   LIFE,    ACCIDENT,    ETC.  [  CH.  IX. 

§  185.  Question  and  Answer  conclusive  as  to  Materiality  ; 
Agreement  as  to  Effect  of  Misrepresentation.  —  But  when  the 
representations  are  in  writing,  and  the  parties,  by  the  frame 
of  the  contents  of  the  papers,  either  by  putting  representa- 
tions as  to  the  history,  quality,  or  relations  of  the  subject 
insured  into  the  form  of  specific  questions,  or  by  the  mode 
of  referring  to  them  in  the  policy,  settle  for  themselves  that 
they  shall  be  deemed  material,  they  are  to  be  declared  so 
by  the  court,  and  the  insured  cannot  be  permitted  to  show 
that  a  fact  which  both  parties  have  treated  as  material  is  in 
fact  immaterial.  The  inquiry  shows  that  the  insurer  con- 
siders the  fact  material,  and  an  answer  by  the  insured 
affords  a  just  inference  that  he  assents  to  the  insurer's  view. 
The  inquiry  and  answer  are  tantamount  to  an  agreement  that 
the  matter  inquired  about  is  material,  and  its  materiality  is 
not  therefore  open  to  be  tried  by  the  jury.^  That  this  mate- 
riality is  under  such  circumstances  a  question  for  the  court, 
has  been  frequently  decided,  especially  in  cases  where  untrue 
answers  are  given  to  questions  as  to  title. ^     Whether  certain 

1  Wilson  V.  Conway  Ins.  Co.,  4  R.  I.  141  ;  Chaffee  v.  Cattaraugus  County 
Mat.  Ins.  Co.,  18  N.  Y.  376  ;  Campbell  v.  New  England  Mut.  Life  Ins.  Co.,  98 
Mass.  381 ;  Anderson  v.  Fitzgerald,  4  H.  L.  Cas.  484  ;  Miller  v.  Mut.  Benefit  Life 
Ins.  Co.,  31  Iowa,  216  ;  Le  Roy  v.  Market  Ins.  Co.,  39  N.  Y.  90;  Price  v.  Phoe- 
nix Mut.  life  Ins.  Co.,  17  Minn.  497;  Bennett  v.  Anderson,  1  Irish  Jur.  o.  s. 
245,  Q.  B.  245  ;  Blumer  v.  Phcenix  Ins.  Co.,  45  Wis.  622 ;  Jeffries  v.  Economical 
Life  Ins.  Co.,  22  Wall.  (U.  S. )  47  ;  iEtna  Life  Ins.  Co.  v.  France,  91  U.  S.  510, 
512;  Cheever  v.  Union  Cent.  Life  Ins.  Co.  (Superior  Ct.  Cincinnati),  5  Ins. 
L.  J.  159.  In  Mutual  Life  Ins.  Co.  v.  Jeffries,  in  the  Supreme  Court  of  the 
United  States,  where  the  applicant  answered  that  he  was  single  when  in  fact  he 
was  married,  the  policy  was  held  to  be  void,  following  the  cases  before  cited  in 
the  same  court  in  this  note  ;  5  Ins.  L.  J.  533  ;  Trefz  v.  Knickerbocker  Life  Ins. 
Co.  (C.  Ct.  N.  J.),  6  id.  850.  [A  misrepresentation  or  concealment  by  one  party 
of  a  fact  specifically  inquired  about,  though  not  material,  will  avoid  the  policy. 
Fame  Ins.  Co.  v.  Thomas,  10  111.  Ap,  545,  556.  The  answer  to  a  specific  question, 
\i&  fraudulent  misrepresentation  will  avoid  the  policy  though  not  really  material, 
for  the  parties  by  putting  and  answering  the  question  have  indicated  that  they 
deemed  the  matter  to  be  material.  Schwarzbach  t-.  Protective  Union,  25  W.  Va. 
622,  655.  A  misrepresentation  must  be  material  unless  clearly  agreed  that  it 
shall  avoid  whether  material  or  not.  Mosley  v.  Vt.  M.  F,  Ins.Co.,  55  Vt.  142. 
A  question  and  answer  are  equal  to  an  agreement  that  the  matter  inquired  about 
is  material,  and  the  question  of  materiality  is  not  open  to  the  jury.  Cuthbertson 
V.  Insurance  Co.,  96  N.  C.  480.] 

2  Locke  r.  North  American  Fire  Ins.  Co.,  13  Mass.  61,  68  ;  Strong  v.  Manuf. 
Ins.Co.,  10  Pick.  (Mass.)  40,  45;  Fletcher  v.  Commonwealth  Ins.  Co.,   18  id. 

370 


CH.  IX.]  EEPKESENTATION.  [§  185 

statements  are  or  are  not  material,  is  a  matter  upon  which 
there  may  be  a  difference  of  opinion.  Nothing  therefore  can 
be  more  reasonable  than  that  parties  entering  into  a  contract 
of  insurance  shall  determine  for  themselves  what  they  think 
to  be  material.  And  that  determination  is  conclusive. ^  So 
an  agreement  that  the  falsity  of  any  statement  in  the  appli- 
cation shall  avoid  the  policy  excludes  from  the  court  and 
jury  the  question  of  its  materiality. ^  And  it  is  of  no  con- 
sequence that  the  assured  did  not  know  of  its  falsity. ^  [In 
Canada,  however,  it  is  held  that  a  variation  of  the  statutory 

419,  421;  Draper  v.  Charter  Oak  Ins.  Co.,  2  Allen  (Mass.),  573;  Towne  v.  Fitch- 
burg  Ins.  Co.,  7  id.  51,  53  ;  North  Am.  Fire  Ins.  Co.  v.  Throop,  22  Mich.  146  ; 
post,  §  209. 

1  Anderson  v.  Fitzgerald,  4  H.  L.  Cas.  484.  In  Gerhauser  v.  North  British 
Ins.  Co.,  6  Nev.  15,  it  is  said  that  it  may  be  doubted  whether  the  fact  that  a 
question  is  put  and  answered  is  anything  more  than  evidence  tending  to  prove 
materiality,  —  a  doubt  which  certainly  is  not  without  reason.  It  ought  not  to  be 
conclusively  presumed  that  the  intention  of  honest  and  intelligent  parties  to  a 
contract  is  to  make  its  validity  depend  on  the  truth  of  an  answer  containing 
matters  wholly  foreign  to  the  risk,  or,  it  may  be,  wholly  irrelevant  to  the  contract. 
Suppose  it  be  said  that  the  insured  house  faces  to  the  north  when  in  fact  it  faces 
to  the  south,  or  that  it  is  painted  red  when  in  fact  it  is  painted  white.  See 
Conover  v.  Mass.  Mut.  Life  Ins.  Co.,  3  Dill.  C.  Ct.  217;  ante,  §  164  et  seq.  ; 
Fitch  V.  American  Popular  Life  Ins.  Co.,  59  N.  Y.  557,  reversing  s.  c.  2  Sup.  Ct. 
(N.  Y.)  247;  Moulor  v.  American  Life  Ins.  Co.,  101  U.  S.  708.  In  Fitch  v. 
American  Popular  Life  Ins.  Co.,  supra,  it  appeared  that  it  was  explained  in  the 
application,  among  other  things,  that  the  insurance  could  only  be  jeopardized 
by  dishonesty  or  inexcusable  carelessness,  and  then  a  series  of  questions  was 
put,  which,  to  use  the  language  of  the  court,  "  no  human  being  could  with  safety 
undertake  to  answer  accurately  and  warrant  the  correctness  of  his  answers."  In 
such  a  case,  say  the  court,  "  a  company  cannot  be  permitted  in  the  .same  paper 
to  say  to  the  assured,  to  induce  him  to  enter  into  the  contract,  that  nothing  but 
fraud  or  intentional  misstatement  shall  avoid  the  policy,  or  that  payment  will  be 
contested  only  in  cases  of  fraud,  and,  when  the  claim  for  payment  is  presented, 
to  set  up  as  a  defence  a  merely  technical  breach  of  warranty  in  relation  to  some 
trivial  matter  though  the  answers  were  warranted  to  be  true." 

2  Jeffries  v.  Insurance  Co.,  22  Wall.  (U.  S.)  48  ;  iEtna  Ins.  Co.  v.  France,  91 
U.  S.  510,  512  ;  Co-operative  Life  Ass.  v.  Leflore,  53  Miss.  1.  [Where  the 
policy  is  to  be  void  in  case  of  "  any  misrepresentation  whatever,"  a  statement 
that  the  owner  was  M.  E.  Jack,  the  widow  of  Cajit.  Jack,  when  really  she  was 
an  infant  three  yeai's  old,  avoids  the  policy.  Graham  v.  Fireman's  Ins.  Co.,  87 
N.  Y.  69.] 

3  Macdonald  v.  Law  Union,  &c.  Ins.  Co.,  L.  R.  9  Q.  B.  328  ;  s.  c.  3  Ins.  L.  J. 
797.  [Byers  v.  Farmers'  Ins.  Co.,  35  Ohio  St.  606  ;  Insurance  Co.  v.  Pyle,  44 
Ohio  St.  19.  In  equity  it  is  immaterial  whether  the  party  misstating  a  fact 
knew  it  to  be  false  or  did  not  have  reason  to  believe  it  was  true,  even  if  misrepre- 
sented by  mistake.     Harding  v.  Randall,  15  Me.  332,  335.] 

371 


§  186]         insurance:  fire,  life,  accident,  etc.        1_ch.  IX. 

condition  which  declares  a  policy  void  for  false  or  incorrect 
statements  without  provision  as  to  their  materiality  is  unjust 
and  unreasonable;!  and  this  seems  to  be  a  just  and  true 

decision.] 

§  186.  Such  Representations  construed  less  strictly  than 
•Warranties.  — Representations  of  this  kind,  however,  are  not 
strictly  warranties,  and  differ  from  warranties  in  that  a  sub- 
stantial compliance  with  them  is  sufficient  to  answer  their 
terms.  2  Whether  there  has  been  such  substantial  compli- 
ance, that  is,  whether  the  representation  is  in  every  mate- 
rial respect  true  is  a  question  of  fact  for  the  jury.  But  it  is 
not  for  the  jury  to  say  that  the  representation,  though  sub- 
stantially untrue,  is  nevertheless  immaterial.  For  example : 
suppose  that  in  answer  to  a  specific  question  the  insured 
states  his  age  to  be  thirty  years,  when  in  fact  he  is  a  month 
older;  or  that  a  building  is  one  hundred  and  ninety  feet  dis- 
tant from  another,  when  in  fact  it  is  but  one  hundred  and 
seventy-eight  feet  distant  ;3  or  that  there  is  no  building 
within  a  hundred  feet  of  the  premises  insured,  when  in  fact 
there  is  a  small  building  adjoining  used  as  a  water-closet;* 
or  that  the  applicant  has  three  brothers,  when  in  fact  he  has 
three  brothers  and  four  half-brothers  ;5  it  would  be  proper  to 
submit  to  the  jury  whether  the  answer,  though  strictly  and 
technically  untrue,  is  not  substantially  and  materially  true. 
The  materiality  of  the  variance  may  properly  be  considered 
by  the  jury  in  passing  upon  the  truth  of  the  answer.  Not 
so,  however,  if  the  answer  be  that  one  stove  only  is  used, 
when  in  fact  two  were  used.^  Nor  under  this  guise  would 
they  have  a  right  to  pass  upon  the  materiality. of  the  ques- 
tion itself,  that  being  conclusively  settled  by  the  act  of  the 
parties,    by  which  both  must  be   bound.      The   substantial 

1  [Reddick  v.  Saugeen  Mut.  Fire  Ins.  Co.,  14  Ont.  E.  506.] 

■■2  Horn  V.  Amicable  Mut.  Life  Ins.  Co.,  64  Barb.  (N.  Y.)  81 ;  post,  §  204. 
[Higgle  V.  American  Lloyds,  14  Fed.  Rep.  143,  7th  Cir.  HI.  1882 ;  Higgie  v. 
National   Lloyds,  11  Biss.  395.] 

3  O'Neil  V.  Ottawa  Agr.  Ins.  Co.,  15  Can.  L.  J.  207,  208  (U.  C.  C.  P.),  1879. 

i  Naughter  v.  Ottawa  Agr.  Ins.  Co.,  43  U.  C.  (Q.  B.)  121. 

5  Bridgman  v.  London  Life  Ass.  Co.  (U.  C.  Q.  B.),  16  Can.  L.  J.  29  (1880). 

6  O'Neil  V.  Ottawa  Agr.  lus.  Co.  (U.  C.  C.  P.),  15  Can.  L.  J.  N.  s.  207,  208. 

372 


CII.  IX.]      '  REPRESENTATION  [§  186 

truth  of  the  statement  —  its  truth  in  all  respects  material  to 
the  risk  1  — they  may  pass  upon;  with  the  materiality  of  the 
facts  they  have  nothing  to  do.2(«)  To  further  illustrate; 
Where  the  interrogatory  was,  "How  long  since  the  party 
was  attended  by  a  physician  ?  For  what  disease  or  dis 
eases  ?  "  and  the  answer,  "  Not  since  the  year  1847,  when  he 
had  the  yellow  fever,"  —  it  was  held  that  the  testimony  of  a 
physician  that  he  had  attended  the  applicant  since  that  time 
for  asthma  did  not  justify  the  withdrawal  of  the  case  from 
the  jury,  and  that  the  question  whether  he  in  fact  had 
asthma,  as  well  as  whether  he  may  not  have  understood  the 
interrogatory  as  asking  information  respecting  attendance 
for  a  particular  disease  or  diseases,  and  their  description, 
should  have  been  submitted  to  the  jury.^  So  the  question 
whether  he  has  consulted  a  physician,  as  it  naturally  diverts 
the  mind  to  a  recent  time,  will  not  be  held  to  be  untrue,  be- 
cause at  some  more  or  less  remote  period  a  physician  was 
consulted.*  And  where  the  question  was  whether  the  appli- 
cant had  any  other  insurance  upon  his  life,  and  the  answer 

1  Cadvvalader,  J.,  in  France  v.  ^tna  Life  Ins.  Co.,  2  Ins.  L.  J.  657. 

2  Miller  v.  Mut.  Benefit  Life  Ins.  Co.,  31  Iowa,  216  ;  Mat.  Benefit  Life  Ins. 
Co.  V.  Wise,  34  Md.  582  ;  Horn  v.  Amicable  Mut.  Life  Ins.  Co.,  64  Barb. 
(N.  Y.)  81.  In  Equitable  Life  Ass.  Soc.  v.  Paterson,  41  Ga.  338,  where  the 
policy  was  to  be  void  upon  any  false  statement  respecting  person  or  family,  and 
the  insured  stated  that  the  woman  whose  life  was  insured  was  his  wife,  when  in 
fact  she  was  not,  as  his  real  wife  was  alive,  though  it  did  not  appear  that  he  knew 
it,  it  was  held  that  the  statement  was  material  if  the  insured  knew  it  to  be  false  ; 
otherwise  not.  But  this  seems  to  be  counter  to  all  the  authorities.  The  mate- 
riality does  not  at  all  depend  upon  a  knowledge  of  the  truth  or  falsehood  of  the 
factsi     As  to  effect  of  knowledge  in  concealment,  see  ?;osi!,  §  202. 

8  Moulor  V.  Am.  Life  Ins.  Co.,  101  U.  S.  708. 

4  World's  Mut.  Life  Ins.  Co.  v.  Schultz,  73  111.  586.  See  also  Rockford  lus. 
Co.  V.  Nelson,  65  id  415. 

{a)    See    Cobb    v.    Covenant    Mut.  be  specially  set  up  in   defence  by  the 

Benefit  Ass'n,  153  Mass.  176  ;  March  v.  insurer,  who  has  the  burden  of  proof. 

Met'n  L.  Ins.  Co.,  186  Penn.  St.  629  ;  O'Connell  v.    Knights   of  Damon,   102 

Sweeney  v.  Met'n   L.  Ins.  Co.,  19  R.  I.  Ga.   143  ;    Chambers   v.    Northwestern 

171 ;  Mutual  L.  Ins.  Co.  v.  Simpson,  88  Mut.    L.    Ins.    Co.,    64    Minn.    495  ; 

Texas,  333.     Representations  in  an  ap-  Marston    v.    Kennebec    Mut.     L.    Ins. 

plication  for  a  life  policy  are  presumed  Co.,    89     Maine,     266  ;     Benjamin     v. 

to  be  true;  and  fraud,  misrepresentation.  Conn.  Ind.   Ass'n,  44   La.  Ann.  1017/ 

or  concealment,  to  be  relied  upon,  must  Yore  v.  Booth,  110  Cal.  238. 

373 


§  187]         insurance:  fire,  life,  accident,  etc.    "    [ch.  ix. 

was  "yes,"  when  there  was  only  a  proposal  for  insurance 
pending,  it  was  left  to  the  jury  to  say  whether  that  answer 
was  true  or  not  true  in  the  sense  of  the  policy,  and  to  find  it 
to  be  true  if  it  was  more  prejudicial  to  him  and  less  injuri- 
ous to  the  insurer,  than  if  the  answer  had  been  literally 
true.  ^ 

§  187.  Substantial  Truth  of  Answers  (continued).  —  In  a 
leading  case,  where  the  questions  were  whether  the  appli- 
cant then  or  theretofore  was  or  had  been  subject  to,  or  in 
any  way  affected  by,  consumption,  bronchitis,  spitting  of 
blood,  &c.,  to  which  the  answer  was  in  the  negative,  the 
court  say:  "The  only  question  for  the  jury  on  this  branch 
of  the  case,  therefore,  was  whether  these  representations 
were  substantially  untrue ;  that  is  to  say,  whether  at  or  be- 
fore the  time  of  making  the  application  the  assured  actually 
had  either  of  these  diseases  or  infirmities;  and,  if  they 
found  that  he  had,  the  policy  was  void,  and  the  plaintiff 
could  not  recover.  Applying  this  rule  to  the  evidence  stated 
in  the  report,  it  was  for  the  jury  to  decide  whether  '  chronic 
bronchitis,'  or  'bronchial  difficulty,'  or  any  other  bodily 
affection  or  condition  to  which  the  assured  w^as  found  by 
them  to  have  been  subject,  amounted  to  bronchitis,  con- 
sumption, disease  of  the  lungs,  or  some  other  of  the  in- 
firmities stated  in  the  application  and  relied  on  by  the 
defendants;  and  whether  the  spitting  of  blood  by  him,  if 
proved  to  have  taken  place,  was  under  such  circumstances 
as  to  indicate  disease  in  his  throat,  lungs,  air  passages,  or 
other  internal  organs.  But  it  was  not  w^ithin  the  province 
of  the  jury,  under  the  guise  of  determining  whether  the 
statements  of  the  applicant  were  materially  false  or  untrue 
in  some  particulars  material  to  the  risk,  to  find  that  dis- 
eases and  infirmities  were  not  material  to  be  disclosed. 
which  the  parties  had  by  the  form  of  the  contract  of  insra'. 
ance  and  of  the  contemporaneous  written  application  con- 

1  Inman  v.  Globe  Mut.  Life  Ins.  Co.,  C.  Ct.  (Ky.),  4  Ins.  L.  J.  719.  In  Som- 
ers  V.  Athenjeum  Ins.  Co.,  9  L.  C.  S.  C.  Montr.  61,  it  was  held  tliata  represen. 
tation  that  an  attached  house  was  unattached  was  immaterial,  it  appearing  that 
the  premium  paid  was  for  an  attached  house. 

374 


CII.  IX.]  REPRESENTATION.  [§  187 

clusively  agreed  to  consider  material. "  ^  So  in  Price  v. 
Phoenix  Mutual  Life  Insurance  Company,''^  where  the  ques- 
tion was,  "Has  the  party  ever  had  any  of  the  following  dis- 
eases ?  "  naming  several,  and  among  others,  "rheumatism," 
and  the  answer  was,  "  Never. "  In  that  case  there  was  evi- 
dence tending  to  show  that  the  life-insured  had  had  sub- 
acute rheumatism.  There  was  also  evidence  in  the  case 
tending  to  show  that  sub-acute  rheumatism  is  not  the  dis- 
ease of  rheumatism,  in  the  ordinary  understanding  of  the 
term.  There  was  also  evidence  tending  to  show  that,  tech- 
nically, and  in  medical  parlance,  sub-acute  rheumatism  is 
the  disease  of  rheumatism,  and  that  it  is  generally  over- 
looked as  a  disease.  And  the  court  left  it  to  the  jury  to 
say,  whether  the  rheumatism  referred  to  in  the  question  is 
the  disease  of  rheumatism.  Any  rheumatic  affection  not 
amounting  to  the  disease  of  rheumatism,  they  said,  would 
not  be  comprehended  in  its  terms,  any  more  than  the  spit- 
ting of  blood  occasioned  by  a  wound  of  the  tongue,  or  the 
extracting  of  a  tooth,  is  the  disease  of  "spitting  of  blood," 
mentioned  in  the  same  question.  The  life-insured  had  a 
right  to  answer  the  question  upon  the  basis  that  its  terms 
were  used  in  their  ordinary  signification.  If  there  is  any 
ambiguity  in  the  question,  so  that  its  language  is  capable  of 
being  construed  in  an  ordinary,  as  well  as  a  technical  sense, 
the  defendant  can  take  no  advantage  from  such  ambiguity.^ 
And  in  the  same  case,  to  the  question,  "  Has  the  party  had, 
during  the  last  seven  years,  any  severe  sickness  or  disease  ?  " 
the  answer  was,  "No."  The  allegation  in  defence  was,  that 
the  life-insured  had  had  within  seven  years  chronic  gastritis. 
There  was  evidence  tending  to  show  that  he  had  had  gas- 
tritis; and  the  court  said  that  unless  chronic  gastritis  and 
gastritis  are  synonymous,  as  to  which  there  is  no  judicial 
presumption  nor  testimony,  the  evidence  was  not  wdthin 
the  issue,  so  that  tlie  false  representation  charged  was  not 

1  Campbell  v.  New  England  Mut.  Life  Ins.  Co.,  98  Mass.  381  ;  Gerhauser  v. 
North  Brit.  &  Mar.  Ins.  Co.,  6  Nev.  15  ;  Conover  v.  Mass.  Mut.  Life  Ins.  Co.,  3 
Dill.  (C.  Ct.)  217  ;  Swick  v.  Home  Ins.  Co.,  2  id.  161  ;  post,  §  300. 

2  17  Minn.  497. 

8  Wilson  V.  Hampden  Fire  Ins.  Co.,  4  R.  L  159.     And  see^^OAt,  §§  202,  210. 

375 


§  187]         insurance:  fire,  life,  accident,  etc.       [ch.  ix. 

proved.  In  addition  to  this  consideration,  the  court  was 
not  free  from  doubt  as  to  whether  gastritis  was  shown  to  be 
"a  severe  sickness  or  disease."  "We  can,"  it  said,  "take 
no  judicial  cognizance  of  its  character.  The  evidence  cer- 
tainh'  has  a  strong  tendency  to  show  that  it  was  the  result 
of  the  excessive  use  of  spirits,  and  that  it  was  an  affection 
of  brief  duration.  We  cannot  say  that  the  jury  might  not, 
ii})on  the  evidence,  find  a  warrant  for  regarding  it  as  a  tempo- 
rary consequence  of  dissipation,  rather  than  a  'severe  sick- 
ness or  disease,'  in  the  ordinary  meaning  of  those  terms." 

So  if  the  question  be  whether  the  party  be  employed  in 
the  military  service,  the  jury  may  consider  whether  the  facts 
proved  show  an  actual  employment,  but  not  the  materiality 
of  the  fact;  or  if  he  has  had  any  sickness  or  serious  injury, 
they  may  consider  whether  the  facts  proved  amount  to  "  sick 
ness  "  or  "serious  injury,"  as  understood  by  the  parties,  but 
not  whether  the  sickness,  if  proved,  is  material ;  or  if  the 
application  of  the  insured  has  been  declined  by  any  com- 
pany, they  may  consider  whether  the  facts  proved  amount  to 
a  declination,  but  not  whether  the  declination  is  material. 
The  question  of  materiality  is  closed  by  the  interrogatory 
and  answer;  the  question  of  the  truth  of  the  answer  is  for 
the  jury;  and  here  they  have  so  much  latitude  as  to  be 
allowed  to  find  it  to  be  true,  if  it  is  substantially  true, 
though  not  technically,  literally,  or  exactly  true.  To  war- 
rant against  disease  is  one  thing ;  to  say  that  there  is  none, 
on  penalty  of  forfeiture  if  there  is  untruth,  is  perhaps  an- 
other, the  element  of  knowledge  sometimes  entering  into 
this  question  of  truthfulness.  ^  (a) 

1  Mut.  Benefit  Life  Ins.  Co.  v.  Wise,  34  MrL  582,  583.  See  also  Wilkinson  v. 
Conn.  Mut.  Life  Ins.  Co.,  30  Iowa,  119;  Swift  v.  Mass.  Mut.  Life  Ins.  Co.,  63 
N.  Y.  186  ;  Hutchison  v.  Nat.  Loan  Fund  Life  Ins.  Co.,  7  Ct.  of  Sess.  Cases,  2d 
series,  467  ;  s.  c.  3  Big.  Life  &  Ace.  Ins.  Cas.  444,  a  very  instructive  case.  See 
also  ante,  §  187  ;  post,  §  295  et  seq.  ;  World  Mut.  Life  Ins.  Co.  v.  Schultz,  73 
111.  586. 

(a)  Neglect  of  the  applicant  to  dis-  Ins.  Co.,  186  Penn.  St.  629.  But  see 
close  an  ailment  which  would  cause  the  Baumgart  v.  Modern  Woodmen  of 
risk  to  be  rejected,  if  known,  is  not  America,  85  Wis.  546  ;  Boyle  v.  North- 
fraud  when  its  real  nature  is  wholly  western  Mut.  Relief  Ass'n,  95  Wis.  312  ; 
unknown  to  him.     March  v.  Met'n  L.  Globe  Reserve  Mut.  L.  Ins.  Co.  v.  Daffy, 

376 


CII.  IX.] 


REPRESENTATION. 


[§  188 


§  188.  As  another  illustration  of  what  is  meant  by  the 
substantial  truth  of  answers  to  questions,  may  be  cited  the 
recent  case  of  Power  v.  City  Fire  Insurance  Company,' 
where  the  answer  was,  "  There  is  a  watchman  when  the  mill 
is  not  in  use,"  and  the  court  charged  the  jury  that  it  was  for 

1  8  Phila.  566. 


76  Md.  293  ;  Albert  v.  Mutual  L.  Ins. 
Co.,  122  N.  C.  92.  When  the  policy 
is  delivered  by  the  insurer's  agents  who 
know  the  applicant's  physical  condition 
and  state  of  health,  or  overdue  pre- 
miums are  repeatedly  taken  without 
requiring  health  certificates,  there  is  a 
■waiver  of  the  health  conditions.  Man- 
hattan L.  Ins.  Co.  V.  Carder,  82  Fed. 
Kep.  986.  See  New  York  L.  Ins.  Co. 
V.  Baker,  83  id.  647  ;  ^tna  L.  Ins.  Co. 
V.  Smith,  88  Fed.  Rep.  440.  In  gen- 
eral, temporary  ailments,  that  do  not 
necessarily  cause  death,  need  not  be 
mentioned  by  an  applicant  for  life  in- 
surance, nor  do  they  vitiate  a  rein- 
statement. Penn.  Mut.  L.  Ins.  Co.  v. 
Mechanics'  Sav.  B.  &  T.  Co.,  37  U.  S. 
App.  692  ;  43  id.  75  ;  Fidelity  Mut. 
L.  Ass'n  V.  Miller,  92  Fed.  Rep.  63; 
Knights  of  Pythias  v.  Cogbill,  99  Tenn. 
28  ;  French  v.  Mutual  Reserve  Fund  L. 
Ass'n,  111  N.  C.  391  ;  Hann  i'.  National 
Union,  97  Mich.  513  ;  Continental  L. 
Ins.  Co.  V.  Yung  (113  Ind.  159),  3  Am. 
St.  Rep.  630,  and  note.  An  a]iplicant 
who  is,  at  the  time  of  insuring,  suffer- 
ing from  a  cold,  which  later  leads  to 
pneumonia,  may  yet  be  held  by  the 
jury  to  be  "in  good  health,"  within  the 
meaning  of  his  representation  to  that 
effect.  Smith  v.  Met'n  L.  Ins.  Co.,  183 
Penn.  St.  504  ;  Barnes  v.  Fidelity  M. 
L.  Ass'n,  191  id.  618  ;  Manhattan  L. 
Ins.  Co.  V.  Carder,  82  Fed.  Rep.  986. 
If  an  applicant  who  has  had  the  grippe, 
and  so  informed  the  medical  examiner, 
answers  "no,"  on  the  latter's  advice 
to  a  question  as  to  serious  illness,  the 
insurer  is  estopped  to  rely  xrpon  such 
representation,  though  it  is  made  a 
warranty.      Mutual    L.     Ins.     Co.     v. 


Blodgett,  8  Tex.  Civ.  App.  45;  see 
Mutual  L.  Ins.  Co.  v.  Selby,  72  Fed. 
Rep.  980  ;  Baker  v.  New  York  L.  Ins. 
Co.,  77  id.  550;  83  id.  647;  Meyer-Bruns 
i\  Penn.  M.  L.  Ins.  Co.,  189  I'enn.  St. 
579  ;  Patterson  v.  Natural  Premium  M, 
L.  Ins.  Co.,  100  Wis.  118  ;  Weimer  v. 
Economic  L.  Ass'n  (Iowa),  79  N.  W. 
123  ;  see  Gallant  v.  Met'n  L.  Ins.  Co., 
167  Mass.  79;  Knights  of  Pythias  v. 
Cogbill,  99  Tenn.  28.  An  injury  re- 
ceived in  early  life,  the  effects  of  which 
have  wholly  disappeared,  is  immaterial 
to  the  question  whether  a  mature  per- 
son was  ever  physically  injured.  Stand- 
ard Life  &  Ace.  Ins.  Co.  v.  Martin,  133 
Ind.  376.  Where  in  the  application 
the  insured  falsely  stated  he  had  never 
had  piles,  and  the  contract  provided 
that  it  shouhl  be  void  if  any  of  the 
statements  in  the  application  should 
prove  untrue,  it  was  held  that  there 
could  be  no  recovery,  although  the  in- 
sured was  ignorant  that  he  had  had 
]iilps.  Baumgart  v.  Modem  Woodmen 
of  America,  85  Wis.  546. 

Where  the  agent  of  an  accident  in- 
surance company,  after  frequently  con- 
versing with  a  man  partially  deaf,  solicits 
him  to  take  out  a  policy,  the  insured  can 
prove  these  facts,  by  the  agent  on  cross- 
examination,  to  rebut  the  presumption 
that  the  coinpany  was  induced  to  take 
the  ri.sk  by  the  representation  in  the 
apyilication  that  the  insured  was  not 
subject  to  any  bodily  infirmity.  Fol- 
lette  V.  U.  S.  Mut.  Ace.  Ass'n,  107  N.  C. 
240.  If  the  evidence  is  conflicting  upon 
the  question  whether  the  assured  had 
a  certain  disease,  the  presumption  is 
against  the  insurer.  Flynn  v.  Mass. 
Benefit  Ass'n,  152  Mass.  288. 

877 


§  188]         insurance:   fire,  life,  accident,  etc.        [ch.  IX. 

them  to  determine  if  this  warranty  was  strictly  kept.i  A 
statement  as  to  future  habits  or  practices,  if  a  warranty  at 
all,  is  not  a  condition  precedent,  since  it  docs  not  relate  to 
the  commencement  of  the  risk.  It  is  at  most  a  promissory 
warranty,  which  is  not  a  condition  precedent,  and  therefore 
its  breach  must  be  alleged  and  proved  by  the  defendant.^ 

1    The  court  said ;   "Every  representation  made  for  the  purpose  of  obtaining 
an  insurance  must  be  strictly  and  literally  true,  in  the  sense  that  no  other  state 
of  facts  can  be  taken  as  an  equivalent  of  it.     If  it  be  that  there  was  a  watchman, 
only  that  fact,  and  no  other  amount  of  equivalent  care  or  cautions  arrangements 
or  other  guards,  can  be  accepted  as  satisfying  the  representation.     The  representa- 
tion in  the  application  is  a  written  covenant  that  it  is  true,  and  makes  the  truth 
of  the  answer  a  condition  precedent  to  any  claim  upon  the  insurer.     I  have  felt 
some  inclination  to  think  that  the  answer  was  not  intended  to  refer  to  the  nightly 
suspensions  of  work  in  the  mill,  but  only  to  seasons  when  the  mill  was  not  in  use 
at  all,  but  lying  idle.     This,  however,  has  not  been  insisted  on,  and  I  do  not  con- 
sider it.     I  take  the  insurer  to  include  the  case  before  us,  wherein  the  mill  was 
run  during  each  day  and  stopped  at  night.     But  I  cannot  say  that  the  answer 
was  intended  by  the  parties  as  a  contract  that  the  insured  should  always  keep  a 
watchman  at  the  mill  when  it  was  not  going,  and  that  his  sole  duty  during  such 
times  should  be  to  watch  against  fire,  always  awake,  and  always  present ;  nor  can 
I  say  that  the  law  constructs  such  a  contract  out  of  the  answer.     The  answer  is 
very  loose  in  its  terms,  and  the  insurers  accept  it  in  all  its  looseness,  and  then  as 
of  little  importance,  and  do  not  insert  it  in  the  policy  for  the  further  guidance 
of  the  insured,  but  file  it  away  in  their  office.     It  makes  no  approach  to  a  defini- 
tion of  the  function  to  be  performed  by  the  watchman.     The  word  is  in  its  very 
nature  loose  and  indefinite  in  its  meaning  ;  and  the  law  cannot  supply  this  defect 
by  giving  a  definition,  because  it  is  not  a  technical  term  of  the  law,  and  because 
the  nature  of  a  watchman's  functions  varies  in  different  places  and  according  to 
the  dangers  to  which  the  property  is  exposed,  and  even  according  to  the  nature 
and  value  of  the  property.     Watchmen  are  seldom  mere  watchmen   against   fire, 
but  almost  always  against  all  dangers,  of  whatever  kind.     Some  kinds  of  danger, 
and  at  some  times,  require  constant  wakefulness  ;  other  kinds,  at  other  times  and 
places,  do  not.     Many,   perhaps  most  persons,  guard  their  stores,  safes,  mills, 
factories,  &c.   (when  they  watch  at  all),  by  clerks  or  hands  who  sleep  on  the 
premises,  so   as  to  be  at  hand  when  danger  arises.     A  family  sleeping  in   the 
house  is  a  protection  of  it.     The  court  cannot  declare,  as  matter  of  law,  what  is 
the  proper  degree  of  a  watchman's  care,  implied  in  this  answer,  without  adding  to 
the  contract  o'f  the  parties.     We  might  as  well  define  a  house  in  a  contract  for 
building  a  house.     It  is  for  the  jury  to  say  whether  or  not  the  plaintiff  has 
strictlylind  literally  complied  with  his  contract  to  keep  a  watchman  when  the  mill 
is  not  "in  use."     This  case  was  affirmed  on  a  writ  of  error  to  the  Supreme  Court. 
See  also  North  Am.  Fire  Ins.  Co.  v.  Throop,  22  Mich.  146,  158,  and  159,  for  some 
valuable  suggestions  as  to  the  strictness  and  precision  required  in  such  answers. 
As  to  keeping  a  watch,  see  further,  post,  §  250  et  seq. 

2  Van  Valkenburgh  v.  Am.  Popular  Life  Ins.  Co.,  70  N.  Y.  605  ;  New  York 
Life  Ins.  Co.  v.  Graham,  2  Duv.  (Ky.)  506  ;  Knecht  v.  Mut.  Life  Ins.  Co.,  90 
Pa.  St.  118 ;  post,  §  192.  In  the  first  of  the  above  cases  the  court  held  the  fol- 
lowing language  (Folger,  J.) :  — 

378 


en.  IX.]  EEPRESENTATION.  [§  188  A 

[§  188  A.  Examples  of  Fatal  Misrepresentations.  —  Stating 
a  mortgage  at  -12,000  when  it  was  really  i$3,200  is  fatal.  ^ 

"The  issue  of  fraud  was  based  upon  the  questions  and  answers  in  the  appli- 
cation for  a  policy.  The  questions  and  answers  relied  upon  by  the  defendant 
were  those  regarding  the  habits  of  the  intestate  in  the  use  of  intoxicating  drinks. 
They  must  be  considered  as  of  the  date  of  the  application,  which  was  in  the  last 
of  December,  1870,  and  a  reasonable  time  before  and  after.  He  answered  that 
his  habits  of  life  were  correct  and  temperate  in  ail  respects  ;  that  he  was  abstemi- 
ous, a  free  and  generous  liver,  and  has  always  been  so.  It  is  not  easy  to  find  any 
definite  result  from  these  answers.  They  seem  to  neutralize  each  other.  The 
idea  conveyed  by  saying  of  a  man  that  he  is  a  free  and  generous  liver,  is  contra- 
dictory of  that  given  by  saying  of  him  that  he  is  temperate  in  all  respects,  and 
abstemious.  If  the  defendant  was  satisfied  with  these  opposing  answers  when  the 
application  was  read  and  the  policy  issued,  it  cannot  now  object. 

"  It  is  difficult  to  understand  some  of  the  questions  and  some  of  the  answers, 
from  the  peculiar  and  obscure  method  adopted  by  the  defendant.  But  it  may  be 
fairly  said  that  the  intestate  answered  that  he  did  not  use  ale,  beer,  or  wine. 
The  statement  of  the  medical  examiner  was  more  positive  and  particular,  to  the 
effect  that  the  intestate  was  temperate  and  correct  in  his  habits,  and  did  not  use 
any  intoxicating  liquors.  There  was  testimony  that  about  the  date  of  this  appli- 
cation, and  before  it,  the  intestate  did  drink  whiskey,  and  once  at  least  to  the 
point  of  intoxication. 

"There  was  also  testimony  on  the  other  side  of  the  question.  It  was  to  the 
effect  that  the  witnesses  knew  him  well,  or  were  very  intimate  with  hiju  J  that 
his  habits  were  good  ;  that  they  remember  his  drinking  but  very  seldom,  and 
never  saw  him  intoxicated  or  under  the  influence  of  liquor  ;  that  he  was  a  re- 
markably healthy  man,  of  fine  physique  ;  that  they  had  known  hini  to  refuse 
liquor  when  offered  to  him,  and  never  saw  anything  to  induce  belief  that  he  was 
not  perfectly  temperate. 

"Though  this  testimony  was,  from  a  necessity  of  its  character,  negative,  still 
it  was  pertinent  to  the  issue,  and  competent  to  be  given  on  a  question  of  the 
habits  of  sobriety  or  the  contrary.  It  needs  must  be  weighed  with  the  affirmative 
testimony  in  coming  to  a  conclusion  whether  with  fraudulent  intent  the  intestate 
made  the  answers  relied  upon  by  the  defendant.  I  do  not  think  that  most  men, 
or  at  least  many  men,  would  feel  tliat  they  were  making  a  fraudulent  ansv.-er  if 
they  said  that  tlieir  habits  of  life  were  correct  and  temperate,  and  that  they  did 
not  use  intoxicating  li(piors,  if  they  drank  them  no  oftener  than  the  intestate  did, 
according  to  the  testimony  of  the  witnesses  for  the  plaintiff,  especially  wlien  with 
that  answer  is  the  other,  that  they  were  free  and  generous  livers,  and  had  always 
been  so.  In  common  acceptation,  the  latter  phrase  indicates  those  who  do  not 
entirely  refrain  from  tlie  use  of  stimulating  drinks. 

"  I  am  obliged  to  confess  that  I  get  no  idea  from  the  question,  '  Nor  use 
alcoholics  in  kind  ?  or  distilled  spirits  in  kind  ?' 

"The  (juestion,  '  Use  any  intoxicating  liquors  or  substances?'  is  a  question 
which  does  not  direct  the  mind  to  a  single  or  incidental  use,  but  to  a  customary 
or  habitual  use.  Such  is  one  of  the  meanings  of  the  noun  '  use  '  and  the  verb 
'  use ; '  as  '  Use  hospitality  one  to  anotlier  without  grudging.*  It  was  a  question 
not  indisputably  and  conclusively  settled  by  the  testimony  as  a  whole,  whether 


1  [Byers  v.  Farmers'  Ins.  Co. ,  35  Ohio  St.  606.] 

379 


§  188  A]      insurance:  fire,  life,  accident,  etc-.       [ch.  ix. 

When  goods  were  described  as  being  in  a  certain  house, 
there  could  be  no  recovery  when  as  a  matter  of  fact  the 
goods  were  in  another  place,  when  burnt.  ^  The  insured 
must,  when  asked  his  occupation,  state  what  he  is  doing  at 
the  time  of  the  application  and  not  what  he  did  years  be- 
fore. A  temporary  suspension  however  would  probably  not 
invalidate  the  answer. ^  A  representation  that  existing  in- 
surance is  less  than  it  really  is,  is  material.^  So  is  a  rep- 
resentation as  to  age.*  "When  a  policy  stipulates  that  false 
answers  to  written  inquiries  shall  avoid  it,  false  answers  to 
parol  inquiries  made  previous  to  the  execution  of  the  policy 
and  on  material  points,  also  avoid  the  policy. °] 

the  intestate  could  be  so  clearly  cliarged  with  such  use  as  that  he  might  plainly  be 
charged  with  a  fraudulent  intent  in  answering  '  no  '  to  the  medical  examiner,  and 
being  so  unsettled,  it  was  proper  to  give  the  solution  of  it  upon  the  evidence  to 
the  jury.  We  have  not  lost  sight  of  the  interpretation  of  the  word  given  to  the 
jury  by  the  court  at  nisi  prius.  If  that  had  been  more  unfavorable  to  the  defend- 
ant than  that  which  we  adopt,  we  might  feel  that  the  defendant  should  have  the 
benefit  of  a  milder  construction. 

"There  was  also  a  conflict  in  the  whole  evidence,  whether  the  disease  of  which 
the  intestate  died  was  aggravated  by  intem]ieranre.  It  was  proper  that  the  jury 
should  pass  upon  it.  It  was  not  for  the  plaintiffs  to  make  out,  as  a  part  of  their 
case,  the  negative  of  that  proposition.  It  was  for  the  defendant  to  establish  it  as 
an  affirmative,  the  same  as  they  would  any  breach  by  the  subject  of  the  insurance 
of  any  other  condition  suhseijuent  of  the  policy.  If  it  be  conceded  to  be  a  war- 
ranty, it  is  not  a  condition  precedent,  for  it  does  not  relate  to  the  commencement 
of  the  risk.  It  is  a  promissory  warranty  which  is  not  a  condition  precedent. 
Kew  York  Life  Ins.  Co.  v.  Graham,  2  Duv.  (Ky.)  506.  I  see  no  error  in  the  por- 
tion of  the  charge  excepted  to,  taken  in  connection  with  the  peculiar  application 
and  contract  in  this  case.  It  was  held  in  Fitch  v.  Popular  Life  Company,  59 
N.  Y.  557,  on  a  like  application  and  policy,  that  it  was  necessary  for  the  defend- 
ant  to  show,  not  only  that  the  statements  were  untrue,  but  that  they  were  known 
to  be  so,  and  were  made  with  a  fraudulent  intent.  Fow  a  fraudulent  intent  must, 
to  some  degree  at  least,  depend  upon  the  understanding  which  the  applicant  has 
of  the  meaning  of  the  question.  The  jury  are  to  find  that  intent  ;  that  it  existed 
in  the  heart  of  the  applicant  at  the  time  he  answered.  Of  course  they  must  first 
find  what  was  his  conception  of  the  question.  If  according  to  that  conception  he 
answered  truthfully,  then  he  did  not  answer  with  fraudulent  intent.  They  are  to 
find  what  that  conception  was,  under  the  direction  of  the  court  as  to  the  legal 
construction  of  the  phrases  used,  if  any  is  required,  or  their  own  understanding 
of  the  purport  of  the  question." 

1  [Eddy  Street  Iron  Foundry  v.  Hampton  Stock  &  Mut.  Fire  Ins.  Co.,  1  Cliff. 
(U.  S.)  300,  304.] 

2  [United  Brethren  Mut.  Aid  Soc.  v.  White,  100  Pa.  St.  12.] 

3  [Armour  v.  Transatlantic  Fire  Ins.  Co.,  47  N.  Y.  Super.  352.] 
«  [Alfi-  Gold  Life  Ins.  Co.  v.  Garner,  77  Ala.  210;  infra,  §  305.] 
6  [Waii"^"i'iglit  V.  Bland,  1  M.  &  \V.  33,  35.] 

380 


CH.    IX.]  REPRESENTATION.  [§  188  C 

[§  188  B.  Examples  of  Disputed  Representations  not  Fatal. 
—  Where  D.  took  out  a  policy  on  his  own  life  payable  to 
M.  M-hom  he  declared,  in  a  j^oatal  to  the  company,  to  be  a 
creditor  and  one  upon  whom  the  applicant  D.  was  depend- 
ent, and  it  appeared  that  M.  was  a  creditor,  but  not  one  on 
whom  D.  was  dependent,  it  was  held  that  the  postal  was 
evidence  to  go  to  the  jury  on  the  question  of  fraud,  but  that 
the  false  statement  as  to  dependence  was  entirely  immate- 
rial D.'s  dependence  on  M.,  even  if  existent,  could  not  be 
effectual  to  give  M.  an  insurable  interest  in  D.^  When  the 
material  fact  is  ownership  it  is  immaterial  that  the  appli- 
cant states  his  holding  to  be  under  a  will  when  really  it  is 
under  a  deed.^  A  representation  in  time  of  peace  that  a 
ship  shall  sail  in  ballast  is  substantially  complied  with 
though  she  have  on  board  a  trunk  of  merchandise  and  ten 
barrels  of  gimpowder,  unknown  to  the  owner.  ^  Mere  mis- 
takes in  stating  facts  which  do  not  in  themselves  (the  facts) 
annul  the  policy  and  do  not  appear  to  be  wilful  misrepresen- 
tations will  not  defeat  the  action.*  When  a  cargo  to  be  put 
on  the  insured  ship  was  misrepresented,  but  the  same  was 
not  stated  in  the  policy,  nor  did  it  appear  to  have  influenced 
the  underwriter  as  to  risk,  it  was  held  that  the  jury  were 
warranted  in  finding  it  to  be  immaterial.^  A  representation 
that  "no  spirits  shall  be  allowed  on  board"  a  ship,  does  not 
prevent  her  carrying  a  whole  cargo  of  them  for  transporta- 
tion.    It  only  prohibits  their  use.^] 

[§  188  C.  It  is  correct  to  answer  the  question  "When 
built  ?  "  by  naming  the  year  of  construction,  although  part 
of  the  materials  had  been  in  an  older  structure,  and  evi- 
dence that  "when  built"  refers  by  usage  only  to  buildings 
wholly  of  new  materials  will  not  be  received.'  An  answer 
that  the  house  was  built  in  1870  whereas  the  true  date  was 

^  [Mace  V.  L.  Ass.,  101  N.  C.  122,  128.] 

2  [Monaghan  v.  Agr.  Fire  Ins.  Co.,  53  Mich.  239.] 

3  Jsuckley  v.  Delafield,  2  Caines  (N.  Y.),  221,  223.] 

<  [Jones  V.  Mechanics'  Fire  Ins.  Co.,  36  N.  J.  L.  29,  41.] 
s  [Flinn  v.  Headlam,  9  B.  &  C.  693,  696.] 

6  [Irvin  V.  Sea  Ins.  Co.,  22  Wend.  380,  381.  ] 

7  [Lamb  v.  Council  Bluffs  Ins.  Co.,  70  Iowa,  238.] 

381 


§  188  C]  INSURANCE  :    FIEE,   LIFE,    ACCIDENT,   ETC.         [CH.  IX. 

1862,  is  immaterial  where  it  appears  that  the  house  is  none 
the  less  vahiable  by  reason  of  extra  age.  ^(a)  A  knowingly 
false  answer  as  to  other  applications  for  insurance  by  the 
same  person  avoids  the  policy.2(5)  But  where  the  question 
was  "Has  any  application  ever  been  made  to  this  or  any 
other  company  on  which  a  policy  was  not  issued  ?  "  was  held 
not  improperly  answered  in  the  negative  where  an  applica- 
tion had  been  made  but  not  passed  upon  as  yet  by  the  com- 
pany.^ Where  a  party  seeking  to  insure  mill  machinery, 
gearing,  tools,  &g.,  was  asked  "What  is  the  value  of  the 
property  to  be  insured,  exclusive  of  land  and  property  not 
specified?"  and  he  answered  "$25,000,"  which  was  the 
value  of  the  entire  mill  property,  it  was  held  that,  tlie  ques- 
tion being  somewhat  ambiguous,  the  insured  might  reason- 
ably infer  that  the  whole  value  of  the  mill  was  what  was 
wanted,  and  especially  as  the  company  was  not  damaged  by 
the  answer,  it  would  not  avoid  the  policy.^  Strict  accuracy 
is  not  required  in  statements  of  value  which  are  matters  of 
opinion,  but  only  good  faith.^  It  must  not  only  be  shown 
that  a  representation  of  value  was  not  true,  but  that  the  in- 
sured knew  it  was  not  at  the  time  he  made  it.^  But  if  the 
statement  of  value  is  made  part  of  the  contract,  the  doctrine 
of  immateriality  does  not  apply. '^  A  representation  as  to 
the  value  of  the  property  insured  is  always  material,  and 

1  fF.ddy  V.  Hawkeye  Ins.  Co.,  70  Iowa,  472.] 

2  [Edin.iiton  v.  Mtna.  Life  Ins.  Co.,  100  N.  Y.  536.] 

8  [Langdon  v.  Union  Mut.  Life  Ins.  Co.,  14  Fed.  Rep.  272  Mich.  1882.] 

*  [Mut.  Mill  Ins.  Co.  v.  Gordon,  20  Brad.  564,  121  111.  366.] 

5  [Dupree  v.  Virginia  Home  Ins.  Co.,  92  N.  C.  417.] 

«  [Lexington  Ins.  Co.  v.  Paver,  16  Ohio,  336,  337.] 

T  [Bobbitt  V.  Liv.,  Lon.,  &  G.  Ins.  Co.,  66  N.  C.  70,  79.] 

(a)  A  statement  in  the  application  ance  existed  on  the  property  is  not  to 

tbat  the  building  cost   $13,000  in  re-  be  deemed  false,  in  such  a  sense  as  to 

sponse  to  the  question  what  proportion  invalidate   the    insurance   obtained   on 

wouhl  remain  uninsured,  is  not  shown  such    application,     merely     because    a 

to  be  untrue  by  evidence  that  it  was  former  owner  of  the  property,  after  hav- 

only  worth  $6,000  at  the  time  of  insur-  ing  parted  with  his  title,  effected  other 

ing.     Myers  r.  Lebanon  Mut.  Ins.  Co.,  insurance   thereon    in    his   own    favor. 

23  Ins.  L.  J.  308.  State  Ins.  Co.  v.  New  Hampshire  Trust 

{b)  A  representation  in  an  applica-  Co.,  47  Neb.  62. 
tion  for  insurance  that  no  other  insur- 

382 


GH.  IX.]  REPRESENTATION.  [§188F 

however  honestly  made,  will  if  false  avoid  the  policy  where 
the  application  is  referred  to  in  it.^] 

[§  188  D.  No  representation  of  a  party's  expectation  or 
belief  or  intention  will  avoid  a  policy  unless  fraudulently 
made.^  The  company  has  no  right  to  rely  on  such  state- 
ments as  absolute  verities.^  A  statement  that  a  ship  will 
sail  on  a  certain  day  is  only  an  expectation,  and  docs  not 
avoid  the  policy  if  untrue,  in  the  absence  of  fraud.*  She 
had  sailed  six  months  previously  unknown  to  the  assured.^ 
An  expression  of  opinion  that  a  ship  "is  sure  to  be  an 
early  one  —  a  cargo  is  ready  for  her"  docs  not  avoid  the 
policy  if  untrue  in  fact,  though  the  risk  is  thereby  ex- 
changed from  a  summer  to  a  winter  risk ;  the  statement 
was  only  one  of  expectation.^  Untrue  representations  if 
made  with  an  honest  and  reasonable  belief  of  their  truth, 
are  no  ground  for  action.^  The  law  will  not  presume  a 
misrepresentati  on.  ^] 

[§  188  E,  Where  a  letter  contains  a  representation  of 
facts  not  known  to  the  party,  but  from  the  information  of 
others,  as  appears  in  the  letter,  or  as  a  necessary  inference 
from  the  nature  of  the  facts,  the  representation  is  not  falsi- 
fied by  the  mere  proof  that  the  facts  are  not  so.  If  the 
party  communicating  the  facts  did  receive  such  information 
and  bona  fide  confided  in  it,  the  policy  would  not  be  avoided." 
A  representation  made  on  application  for  insurance  may 
be  withdrawn  or  qualified  before  the  execution  of  the 
policy.  ^0] 

[§  188  F.  Representations  by  the  Company.  —  A  pamphlet 
issued  by  the  company  and  shown  to  the  plaintiff   by  the 

1  [Bobbitt  V.  Liv.,  Lon.,  &c.  Ins.  Co.,  66  N.  C.  70.] 

2  [Bryant  v.  Ocean  Ins.  Co.,  22  Pick.  200.] 

3  [Clason  V.  Smith,  3  Wash.  C.  C.  156,  157.] 

4  [Rice  V.  N.  E.  Jilar.  Ins.  Co.,  11  Pick.  439,  443.] 

5  [iWber  V.  Fletcher,  1  Doug.  305,  306.] 
«  [Hubbard  v.  Glover,  3  Camp.  313,  315.] 

^  [Shrewsbury  v.  Blount,  2  Manning  &  Granger,  475 ;  Rawlings  v.  Bell,  1  C. 
B.  951.] 

^  [Pine  V.  Vanuxem,  3  Yeates  (Penn.),  30,  33.] 
®  [Tidmarsh  v.  Washington,  &c.  Ins.  Co.,  4  Mason,  439.] 
I''  [Edwards  v.  Footner,  1  Camp.  530,  531.] 

383 


§  189]        insurance:  fire,  life,  accident,  etc.         [ch.  ix. 

soliciting  agent  to  induce  him  to  insure  enters  into  the  con- 
tract as  a  representation  of  the  company,  and  if  it  promises 
a  paid-up  policy  the  insurer  is  entitled  to  one,  although  his 
policy  is  silent  on  the  subject. ^  If  the  false  representation 
of  the  insured  is  induced  by  the  false  representations  of  the 
agent  of  the  insurer,  the  latter  cannot  set  up  the  insured's 
misrepresentation.  ^] 

§  189.  Representation  in  Part  true  and  Part  false ;  Entire 
Contract.  —  Where  the  plaintiff  insures  for  a  specific  sum 
on  a  store,  and  another  specific  sum  on  the  stock  of  goods 
therein,  and  gives  one  note  for  the  premium  on  both  sums, 
representing  them  to  be  his  store  and  goods,  when  in  fact 
he  has  no  title  to  the  store,  the  contract  being  entire,  the 
misrepresentation  vitiates  it,  so  that  nothing  can  be  recov- 
ered for  the  loss  of  the  goods  which  were  admitted  to  belong 
to  the  insured. 3  So  where  the  property  is  represented  to  be 
unincumbered,  when  in  fact  it  is  in  part  covered  by  a  mort- 
gage.* [Where  distinct  classes  of  property  separately  valued 
are  insured,  though  for  a  gross  premium,  the  contract  is 
severable,  and  a  misrepresentation  as  to  ownership  of  real 

1  [Southern  IMut.  Life  Ins.  Co.  v.  Montague,  84  Ky.  653.  A  railroad  company- 
is  liable  for  false  statements  on  its  time-tables  when  prejudicial  to  others  :  Denton 
V.  G.N.  Ey.  Co.,  5  E.  &  B.  860  ;  as  where  a  train  is  taken  off  without  notice  to 
the  public] 

2  (Cook  V.  Lion  Fire  Ins.  Co.,  67  Cal.  368.] 

8  Day  V.  Charter  Oak  Fire  &  Mar.  Ins.  Co.,  51  Me.  91  ;  Lovejoy  v.  Augusta 
Mut.  Fire  Ins.  Co.,  45  id.  472  ;  Hinman  v.  Hartford  Fire  Ins.  Co.,  36  Wis.  159  ; 
Bowman  v.  Franklin  Fire  Ins.  Co.,  40  Md.  620;  Gottsman  v.  Insurance  Co.,  56 
Pa.  St.  210;  Kreutz  v.  Niagara,  &c.  Ins.  Co.,  16  U.  C.  (C.  P.)  131;  Kuss  v. 
Mut.  Fire  lus.  Co.,  29  U.  C.  (Q.  B.)  73  ;  Moore  v.  Virginia  Fire,  &c.  Ins.  Co., 
28  Grat.  (Va.)508;    Plath   v.    Minnesota,    &c.   Ins.  Co.,  23   Minn.  479;   post, 

§§  277,  278. 

*  Friesmuth  v.  Agawam  Mut.  Ins.  Co.,  10  Cush.  (Mass.)  587  ;  Smith  v.  Em- 
pire Ins.  Co.,  25  Barb.  (N.  Y.)  497  ;  Gould  v.  York  County  Mut.  Fire  Ins.  Co., 
47  Me.  403.  Contra,  Koontz  v.  Hannibal  Sec.  Ass.,  42  Mo.  126  ;  Loehmer  v. 
Home  Mut.  Ins.  Co.,  19  Mo.  628  ;  Phoenix  Ins.  Co.  i'.  Lawrence,  4  Met.  (Ky.)  9. 
Two  houses  were  separately  valued  in  the  same  policy.  Both  were  burned.  The 
policy  provided  that  if  left  vacant  without  notice  and  consent,  the  policy  should 
be  void.  One  was  vacant,  and  had  been  for  the  specified  period  at  the  time  of 
the  fire.  The  court  held  that  recovery  could  be  had  for  the  occupied  house,  but 
not  for  the  unoccupied  one.  Hartford  Fire  Ins.  Co.  v.  Walsh,  54  111.  164  ;  Com- 
mercial Ins.  Co.  V.  Spankneble,  52  id.  53.  But  see  Lovejoy  v.  Augusta  Mut.  Fire 
Ins.  Co.,  supra.    And  see  also  post,  §  277. 

384 


CH.  IX.] 


REPRESENTATION. 


[§190 


estate  not  made  in  bad  faith  will  not  vitiate  the  policy  as  to 
the  personalty  it  covers.^  (a)] 

§  190.  Effect  of  Change  of  Circumstances  pending  Negotia- 
tion. —  A  representation  is  a  continuous  statement  from  the 
time  it  is  made,  during  the  progress  of  the  negotiations, 
and  down  to  the  time  of  the  completion  of  the  contract ;  so 
that  though  in  point  of  fact  the  representation  be  true  when 
actually  made,  yet  if  by  some  change  intervening  between 
that  time  and  the  time  of  completion  of  the  contract  it  then 
becomes  untrue,  it  will  avoid  the  contract  if  the  change  be 
material  and  to  the  prejudice  of  the  insurers,  or  be  such  as 
might  probably  influence  their  opinion  as  to  the  advisability 

1  [Schuster  v.  Dutchess  County  Ins.  Co.,  102  N  Y.  260,  263-266.] 


{a)  In  "Wisconsin  it  is  held  that  a 
change  in  the  title  to  one  of  several 
farms  or  buildings  covered  by  a  iire 
policy,  and  situated  at  some  distance 
from  each  other,  does  not  render  the 
policy  void  as  to  the  other  farms  or 
buildings,  under  the  clause  in  tlie  policy 
making  it  void  in  case  of  a  change  of 
title  without  the  insurer's  consent  : 
Loomis  V.  Rockford  Ins.  Co.,  77  Wis. 
87  ;  but  that  insurance  on  a  ])uilding 
and  its  contents,  with  the  risk  distrib- 
uted part  to  the  realty  and  part  to  the 
personalty,  is  a  single,  indivisible  con- 
tract, and,  under  a  general  forfeiture 
clause,  a  circumstance  which  bars  a  re- 
covery for  a  loss  on  part  of  the  property 
bars  a  recovery  for  all.  Carey  v.  Ger- 
man-American Ins.  Co.,  84  Wis.  80 ; 
Woracher  v.  New  Denmark  M.  H.  F. 
Ins.  Co.,  102  Wis.  88.  See  Teutonia 
Ins.  Co.  V.  Howell  (Ky.),  54  S.  W.  852  ; 
Continental  Ins.  Co.  v.  Ward,  50  Kan- 
sas, 346  ;  German  F.  Ins.  v.  Fairbank, 
32  Neb.  750.  So  insurance  upon  dis- 
tinct lots  of  personalty  on  the  same 
premises,  with  the  risk  distributed  to 
each  item,  is  one  indivisable  contract. 
Burr  V.  German  Ins.  Co.,  84  Wis.  905; 
36  Am.  St.  Rep.  905,  and  note ;  Man- 
chester F.  Ins.  Co.  V.  Glenn,  13  Ind. 
App.  365.  A  similar  principle,  as  to 
VOL,  I.  — 25 


indivisibility  of  contract  and  its  result, 
has  been  applied  where  a  life  insurance 
agent  agreed  to  extend  a  premium  note 
on  condition  that  the  insured  wo'iM  pay 
a  personal  debt  to  the  agent ;  and  a  fail- 
ure to  perform  the  condition  which  was 
the  sole  consideration  for  the  renewal, 
left  the  contract  void.  Union  Cent.  L.  . 
Ins.  Co.  V.  Berlin,  90  Fed.  Rep.  779. 

When  a  single  policy  covers  both  a 
house  and  the  personal  property  therein, 
arson  intended  and  carried  out  as  to  the 
personalty  also  avoids  the  policy  as  to 
the  realty.  Names  v.  Dwelling-house 
Ins.  Co.,  95  Iowa,  642  ;  Agricultural 
Ins.  Co.  V.  Hamilton,  82  Md.  88.  See 
Manchester  F.  Ass.  Co.  v.  Koerner,  13 
Ind.  App.  372.  So  if  a  house  and  per- 
sonal property  therein  are  insured  to- 
gether, and  there  is  fraud  in  the  proofs 
of  loss  as  to  the  personalty,  insurance 
cannot  be  recovered  for  the  house. 
Home  Ins.  Co.  v.  Connally  (Tenn. ), 
56  S.  W.  828. 

In  Massachusetts,  it  is  held  that 
when  only  one  premium  is  paid  for  fire 
insurance  on  two  buildings,  the  insur- 
ance is  entire,  and  the  contract,  if  partly 
void  because  of  misdescription,  is  wholly 
void,  and  cannot  be  apportioned. 
Thomas  v.  Commercial  Union  Ass.  Co., 
162  Mass.  29. 

385 


§  190]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  IX. 

of  accepting  the  risk.  The  law  regards  it  as  made  at  the 
instant  the  contract  is  entered  into.^  And  the  same  rule 
applies  in  case  of  concealment.  Any  change  in  the  state  of 
health  of  the  person  or  condition  of  the  property  to  be  in- 
sured, pending  the  negotiations,  if  such  changes  would  nat- 
urally have  any  influence  upon  the  judgment  of  the  insurers, 
must  be  made  known,  as  the  state  of  facts  existing  at  the 
time  of  the  completion  of  the  contract  will  be  deemed  to 
have  been  the  basis  of  the  contract. ^  And  a  change  from  a 
state  of  good  health  to  serious  illness,  or  from  a  mild  to  an 
aggravated  form  of  the  same  disease,  is  a  change  which 
ought  to  be  disclosed.^  Where,  however,  one  company 
assumes  the  risks  of  another  and  issues  a  new  policy,  the 
representations  are  only  held  to  be  true  when  the  original 
policy  was  issued.*  Where  renewals  are  made  upon  the 
statements  in  the  original  application,  whether  the  truth  of 
the  statement  is  to  be  tried  by  the  circumstances  existing  at 
the  time  of  the  renewal,  or  at  the  time  when  the  original 
application  was  made,  is  a  question  upon  which  the  authori- 
ties do  not  agree ;  some  taking  the  view  that  a  renewal 
makes  a  new  contract,^  and  others  that  it  merely  continues 
the  old  one.^  Special  circumstances,  however,  seem  to  con- 
trol the  decision,  according  as  these  circumstances  indicate 
the  intent  of   the  parties.'^     So  where  a  recent   purchaser 

1  Trail  v.  Baring,  4  Giff.  485;  s,  c.  affirmed  on  appeal,  10  L.  T.  N.  s.  215; 
Whitley  v.  Piedmont,  &c.  Ins.  Co.,  71  N.  C.  480. 

2  British  Eq.  Ins.  Co.  v.  Great  West.  Ins.  Co.,  38  L.  J.  Ch.  132  ;  s.  c.  on 
appeal,  20  L.  T.  N.  s.  422  ;  Calvert  v.  Hamilton  Mut.  Ins.  Co.,  1  Allen  (Mass.), 
308;  Lishman  v.  Northern,  &c.  Ins.  Co.,  L.  R.  10  C.  P.  (Ex.  Oh.)  179;  s.  c.  4 
Ins.  L.  J.  394  ;  Blumer  v.  PhcEnix  Ins.  Co.,  45  Wis.  622  ;  post,  .§§  250,  294  ;  De 
Camp  V.  New  Jersey,  &e.  In.s.  Co.,  0.  Ct.  (N.  Y.),  3  Ins.  L.  J.  89  ;  Piedmont,  &c. 
Ins.  Co.  V.  Ewing,  92  U.  S.  377,  380. 

8  Wemyss  v.  Med.  Invalid  &  Gen.  Life  Ins.  Soc,  11  Ct.  of  Sess.  (Scotch), 
2d  series,  345 ;  Piedmont,  &c.  Ins.  Co.  v.  Ewing,  92  U.  S.  377,  380. 

*  Cahen  v.  Continental  Life  Ins.  Co.,  69  N.  Y.  300,  308 ;  Cheever  v.  Union, 
&c.  In.s.  Co.,  4  Am.  Law  Record,  155;  s.  c.  5  Big.  Life  &  Ace.  Ins.  Cas.  458. 

5  Brady  v.  Northwestern  Ins.  Co.,  11  Mich.  425  ;  Brueck  v.  Phoenix  Ins.  Co., 
59  N.  Y.  1  ;  Atkin  v.  Nat.  Ins.  Co.  (Q.  B.),  Montreal,  8  Ins.  L.  J.  78. 

6  New  Eng.  Fire  &  Mar.  Ins.  Co.  v.  Wetmore,  32  111.  221 ;  Baltimore  Fire  Ins. 
Co.  V.  McGowan,  16  Md.  47. 

■^  Driggs  V.  Albany  Ins.  Co.,  10  Barb.  (N.  Y.)  440;  Aurora,  &c.  Ins.  Co.  v. 
Kranich,  36  Mich.  289 ;   Hartford  Fire  Ins.  Co.  v.  Walsh,  54  111.  164  ;  Phelps  v. 

386 


CH.  IX.]  REPRESENTATION.  [§  190 

applied  for  a  policy,  and  at  the  suggestion  of  the  insurer's 
agent  took  an  assignment  of  the  policy  existing,  a  represen- 
tation which  was  false  at  the  time  the  policy  was  issued,  but 
was  true  at  the  time  it  was  assigned,  was  held  not  to  vitiate 
the  contract.  1  In  the  reinstatement  of  a  lapsed  policy  no 
statement  of  intermediate  changes  need  be  made  unless  re- 
quired.^ And  where  the  policy  was  to  take  effect  only  on 
the  actual  payment  of  the  premium,  and  a  change  was  made 
prior  to  the  payment  of  the  premium  and  the  delivery  of  the 
policy,  but  after  its  date,  it  was  held  that  intermediate 
changes  were  not  an  increase  after  the  making  of  the  con- 
tract. ^  In  some  cases  it  is  expressly  stipulated  that  the 
renewal  shall  be  upon  the  express  understanding  that  the 
original  representations  remain  true  at  the  time  of  renewal.* 
But  where  a  renewal  certificate  is  taken  out,  with  distinct 
notice  to  the  insurers  that  the  property  returned  has  been 
removed  from  the  premises  described  in  the  policy  to  other 
premises,  the  renewal  contract  will  cover  the  property  in- 
sured in  its  new  location.  This  must  have  been  the  intent 
of  the  parties,  certainly  the  intent  and  understanding  of  the 

Gebhard  Ins.  Co.,  9  Bosw.  (N.  Y.)  404.  In  a  New  Brunswick  case  it  appears 
that  the  company  alread}'  insuring  by  a  policy  which  expired  October  2,  1866, 
notified  the  insured  that  it  would  run  for  a  year  upon  the  same  terms,  whereupon 
the  insured,  October  6,  paid  the  amount  of  the  premium  to  the  local  agent,  the 
receipt  of  the  premium  being  indorsed  by  the  local  agent  on  the  back  of  the 
notice.  This  local  agent  afterwards,  without  the  knowledge  of  the  insured,  took 
out  a  policy  upon  the  same  property  from  another  company,  based  on  the  applica- 
tion filed  with  the  first  company,  dated  October  6,  and  expressly  insuring  for  one 
year  from  October  2d.  October  13,  the  property  was  destroyed  by  fire  ;  but  with- 
out the  knowledge  of  this  fact  the  policy  in  the  name  of  the  insured  was  forwarded 
by  the  local  agent  of  the  first  company,  who  acted  also  for  the  second  company, 
to  the  original  insured.  Under  these  peculiar  circumstances  this  was  held  to 
amount  substantially  to  a  reinsurance,  that  the  policy  related  back  to  October  2d, 
that  the  representation  must  be  understood  to  be  made  as  of  that  date,  and  that 
the  insured  might  recover  in  his  own  name,  having  accepted  the  policy  taken  out 
in  his  behalf  by  the  local  agent.  GifTard  v.  Queen  Ins.  Co.,  1  Hannay  (N.  B.), 
432.  A  second  renewal  with  changes,  after  a  first  renewal  with  different  changes, 
is  a  renewal  of  the  original  contract,  with  the  changes  stated  in  the  last.  Hon- 
nick  V.  Phoenix  Ins.  Co.,  22  Mo.  82. 

1  Chapman  v.  Gore  Dist.  Mut.  Ins.  Co.,  26  U.  C.  (C.  P.)  89. 

^  Day  V.  Mut.  Benefit  Life  Ins.  Co.,  Sup.  Ct.  (D.  C),  1  McArthur,  41. 

^  Fourdrinier  v.  Hartford  Fire  Ins.  Co.,  15  U.  C.  (C.  P.),  403. 

*  Liddle  v.  Market  Fire  Ins.  Co.,  29  N.  Y.  184 ;  Lancey  v.  Phrenix  Ins.  Co., 
6  Me.  562. 

387 


§  191]  insurance:   fire,  life,  accident,  etc.         [CH.  IX. 

insured,  as  the  insurers  must  have  known ;  and  it  was  also 
their  intent  and  understanding,  unless  they  designed  to  de- 
fraud under  the  guise  of  the  contract,  which  will  not  be 
presumed.^  And  a  consent  to  a  removal  of  property  insured 
is  also  a  new  contract,  and  waives  a  forfeiture  by  reason  of 
known  additional  risks  prohibited  by  the  original  policy.  ^ 

§  191.  Subsequent  Changes  immaterial.  —  If  the  agreement 
be  complete,  whether  the  policy  be  delivered  and  the  pre- 
mium paid  or  not,  it  is  immaterial  that  there  has  been  a 
change  since  the  agreement,  or  even  a  loss.^  If  a  warranty 
or  representation  be  true  when  the  bargain  is  closed,  any 
usual  and  ordinary  changes  subsequent  to  that  time  will  be 
inoperative  to  vitiate  the  contract  unless  prohibited,  and 
courts  will  not  favor  attempts  which  are  sometimes  made  to 
convert  an  affirmative  into  a  promissory  or  continuing  repre- 
sentation or  warranty.  Thus,  when  it  is  represented  that  a 
building  "  is  used  only  for  the  purpose  of  meeting  of  a  band 
during  two  evenings  of  the  week,"  the  representation  applies 
merely  to  the  then  existing  use  of  the  building,  not  to  the 
future  use  of  the  property.^  So  if  it  be  described  as  an 
"unoccupied"  house,  "but  to  be  occupied  by  a  tenant;"  or 
in  answer  to  the  question  about  occupation  it  is  said  that  it 
"will  be  occupied  by  a  tenant,"  —  this  is  neither  a  warranty 
that  it  shall  continue  unoccupied,  nor  that  it  shall  be  occu- 
pied, but  rather  a  representation  true,  if  such  was  the  fact, 
of  the  existing  state  of  things,  and  a  statement  of  an  expec- 
tation that  it  would  be  so  occupied,  with  a  reservation  of  the 
right  to  have  it  so  occupied ;  and  such  statements  are  not  to 
be  treated  as  limiting  the  use  of  property  so  as  to  deprive 
the  insured  of  the  enjoyment  of  it  as  is  usual  in  such  cases.  ^ 

*  Ludwig  V.  Jersey  City  Ins.  Co.,  48  N.  Y.  379.     And  see  post,  §  294. 

'^  Eathbone  v.  City  Fire  Ins.  Co.,  31  Conn.  193 ;  Dickson  v.  Provincial  Ins. 
Co.,  24  U.  C.  (C.  P.)  157. 

3  Southern  Life  Ins.  Co.  v.  Kempton,  56  Ga.  339;  ante,  §  135;  Ellis  v.  Albany, 
&c.  Fire  Ins.  Co.,  50  N.  Y.  402;  Inbuscli  v.  Northwestern  Nat.  Ins.  Co.,  4  Ins. 
L.  J.  545,  coram  Dixon,  arbitrator  ;  Franklin  Fire  Ins.  Co.  v.  Colt,  20  Wall. 
(U.  S.)  560;  City  of  Davenport  v.  Peoria  Mar.  &  Fire  Ins.  Co.  17  Iowa,   276. 

*  Blood  V.  Howard  Fire  Ins.  Co.,  12  Cush.  (Mass.)  472. 

5  Hughes  V.  City  Fire  Ins.  Co.,  27  Conn.  10;  O'Niel  v.  Buffalo  Fire  Ins.  Co.,  3 
Comst.  (N.  Y.)  122;  Herrick  v.  Union  Mut,  Fire  Ins.  Co.,  48  Me.  558.     See  §  156. 
388 


CH.  IX.]  REPRESENTATION.  [§  192 

So,  where  it  is  said  that  "a  clerk  sleeps  in  the  store;  "^  or 
that  "  barns  are  used  for  hay,  straw,  shelter,  and  stabling ;  "  ^ 
and,  generally,  when  the  statement  is  as  to  the  employment 
or  habits  of  a  person,  or  the  manner  in  which  a  building  is 
occupied  or  used,  or  the  amount  of  other  insurance,  or  the 
intentions  of  the  applicant.  ^  Such  .  statements  are  properly 
to  be  regarded  as  descriptive  of  present  status,  condition, 
and  expectation,  and  not  as  importing  a  promise  as  to  future 
use  or  conduct.  If  insurers  wish  to  control  such  use,  they 
must  do  it  expressly  and  by  apt  words,  and  not  expect  the 
courts  to  aid  them  by  construction.*  So  if  it  is  stated  in 
the  policy  that  the  adjoining  land  is  "vacant,"  this  does  not 
warrant  that  it  shall  continue  so,  and  the  insured  may  erect 
buildings  thereon  though  the  risk  to  the  property  insured  be 
thereby  increased.^ 

§  192.  Oral  statements  prior  or  subsequent  to  Application 
immaterial.  —  If  a  written  application  be  made,  it  will  be 
presumed  to  contain  the  representations  which  induce  the 
contract,  and  proof  of  prior  or  subsequent  verbal  statements 
is  inadmissible ;  ^  and  especially  if  it  be  an  oral  representa- 

1  Frisbie  v.  Fayette  Ins.  Co.,  27  Pa.  St.  325. 

2  Billings  V.  Tolland  County  Mut.  Ins.  Co.,  20  Conn.  139. 

8  Horton  v.  Equitable  Life  Ass.  Soc,  New  York  City  Court  of  Common 
Pleas,  Daly,  J.,  2  Big.  Life  &  Ace.  Ins.  Cases,  108 ;  Reichard  v.  Manhattan  Life 
Ins.  Co.,  31  Mo.  518;  Benham  v.  United  Guarantee  &  Life  Ass.  Co.,  7  Exch. 
744;  ante,  §  188;  Franklin  Fire  Ins.  Co.  v.  Chicago  Ice  Co.,  36  Md.  102;  For- 
bush  V.  Western  Mass.  Ins.  Co.,  4  Gray  (Mass.),  337,  338:  j^ost,  §  306;  Knecht 
V.  Mutual,  &c.  Ins.  Co.  (Pa.),  8  Ins.  L.  J.  639. 

4  Smith  V.  Mechanics'  &  Traders'  Mut.  Fire  Ins.  Co.,  32  N.  Y.  399  ;  Langdon 
V.  New  York  Equitable  Ins.  Co.,  1  Hall  (N.  Y.  Superior  Ct.),  226;  s.  c.  6  Wend. 
(N.  Y.)  623;  Rafferty  v.  New  Brunswick  Fire  Ins.  Co.,  3  Harr.  (N.  J  )  480; 
Boardman  v.  Merrimack  Mut.  Fire  Ins.  Co.,  8  Cush.  (Mass.)  583;  Hall  v.  Peo- 
ple's Mut.  Fire  Ins.  Co.,  6  Gray  (Mass.),  185;  Boardman  v.  New  Hampshire 
Mut.  Fire  Ins.  Co.,  20  N.  H.  551. 

5  Stebbins  v   Globe  Ins.  Co.,  2  Hall  (N.  Y.  Superior  Ct.),  632. 

6  Boggs  V.  Am.  Ins.  Co.,  30  Mo.  63  ;  Rawls  v.  Am.  Life  Ins.  Co.,  27  N.  Y. 
282 ;  Howell  v.  Knickerbocker  Life  Ins.  Co.,  44  id.  276 ;  Insurance  Co.  v.  Mowry, 
96  U.  S.  544;  Candee  v.  Citizens'  Ins.  Co.,  C.  Ct.  (Conn.),  4  Fed.  Rep  143; 
Lamatt  v.  Hudson,  &c.  Ins.  Co.,  17  N.  Y.  199;  Franklin  Fire  Ins.  Co.  v.  Martin, 
40  N.  J.  Law,  568;  Schmidt  v.  Peoria,  &c.  Ins.  Co.,  41  111.  295;  Pindar  v.  Reso- 
lute Fire  Ins.  Co.,  47  N.  Y.  114;  Todd  v.  Liverpool,  &c.  Ins.  Co.,  18  U.  C. 
(C.  P.)  192;  Hartford  Fire  Ins.  Co.  v.  Davenport,  37  Mich.  609.  As  to  fraudu- 
lent statements  of  contents  of  paper  to  an  illiterate  man,  see  Keller  v.  Eq.  Fire 
Ins.  Co.,  28  Ind.  170. 

389 


§  193]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  IX. 

tion  as  to  a  future  fact,  as  that  a  house  will  be  occupied,  or 
will  be  occupied  in  a  certain  way,  or  not  occupied  at  all,  for 
if  it  is  a  mere  statement  of  an  expectation  honestly  enter- 
tained, subsequent  disappointment  will  not  prove  it  untrue ; 
and  if  it  is  a  provision  that  a  certain  state  of  facts  shall 
exist  or  continue  during  the  currency  of  the  policy,  it 
should  be  incorporated  into  the  written  contract.^  So  as  to 
non-fraudulent  representations  touching  the  value  of  the 
property  insured.'^  But  a  reference  in  the  policy  to  parol 
statements  will  authorize  proof  of  what  they  were.^  And 
verbal  representations  may  become  effectual  even  as  war- 
ranties,  if  written  into  and  made  part  of  the  policy.^ 

§  193.  Equivocal  "Words  and  Phrases.  —  The  question 
whether  there  is,  or  is  not,  a  misrepresentation,  not  unfre- 
quently  turns  upon  the  meaning  of  a  particular  word  or 
phrase  used  in  the  policy ;  and  in  such  cases  the  insured 
will  have  the  benefit  of  all  reasonable  doubts,  the  construc- 
tion being  most  strongly  against  the  insurer  as  the  author 
of  the  contract,  and  also  because  the  court  will  not  go  any 
farther  in  enforcing  a  penalty  or  forfeiture  than  it  feels 
obliged  to  by  the  necessary  force  of  the  language  used.  Thus 
where  the  property  insured  was  a  stock  of  goods  described 
as  "all  of  goods  usually  kept  in  a  country  store,"  and  it  was 
represented  that  no  "  cotton  or  woollen  waste  or  rags  "  were 
kept  in  the  building,  and  it  appeared  that  clean  white  cot- 

1  Kinihall  v.  Mtm.  Ins.  Co.,  9  Allen  (Mass.),  540;  Alston  v.  Mechanics'  Ins. 
Co.,  4  Hill  (N.  Y.),  329,  reversing  s.  c.  1  id.  510 ;  Mayor  of  New  York  v.  Brook- 
lyn Fire  Ins.  Co.,  4  Keyes  (N.  Y.),  465,  affirming  s.  c.  41  Barb.  231.  See  also 
ante,  §  182.  In  Hartford  Fire  Ins.  Co.  v.  Davenport,  37  Mich.  609,  the  court 
distinguishes  those  cases  of  waiver  and  estoppel  based  upon  the  knowledge  or 
conduct  relating  to  existing  facts  of  the  insurer  inconsistent  with  an  honest 
intention  to  enforce  a  particular  condition,  and  a  parol  promise,  made  prior  to 
the  execution  of  the  policy  concerning  some  future  event.  "There  is  no  resem- 
blance," it  says,  "between  a  parol  variance  of  a  written  contract,  and  a  waiver  of 
a  condition  after  it  has  become  binding  upon  the  parties."  But  this  distinction 
has  been  by  no  means  observed.  The  case  of  Bilbrough  v.  Met.  Ins.  Co.,  5  Uiier 
(N.  Y.  Superior  Ct. ),  587,  to  the  contrary,  does  not  seem  to  have  met  with  appro- 
bation.    See  also  ante,  §  182. 

2  New  York  Gas  Light  Co.  v.  Mechanics'  Fire  Ins.  Co.,  2  Hall  (N.  Y.),  108. 

3  Clark  V.  Manufacturers',  &c.  Ins.  Co.,  2  W.  &  M.  C.  Ct.  (Mass.)  472. 

*  Campbell  v.  N.  E.  Mut.  Life  Ins.  Co.,  98  Mass.  381 ;  Higbie  v.  Guardian 
Life  Ins.  Co.,  53  N.  Y.  603. 

390 


CH.  IX.]  KEPRESENTATION.  [§  194 

ton  rags  were  kept  in  the  store,  —  it  was  held,  that  as  such 
rags  were  ordinarily  kept  in  a  country  store,  and  as  there 
was  an  express  provision  in  the  by-laws  that  "cotton  or 
woollen  waste  or  oily  rags  "  should  not  be  allowed  to  remain 
overnight  in  any  building  insured  by  the  company,  if  cotton 
rags  of  any  kind  were  excluded  it  could  only  be  those  which, 
from  their  nature  or  condition,  are  easily  inflammable,  and 
for  that  reason  classed  with  "  cotton  and  woollen  waste. "  ^ 
So  the  question  being  whether  the  building  was  "leased  or 
rented,"  it  was  held  to  be  material  to  ascertain  whether  the 
applicants  were  lessors.  And  in  another  case,  where  the 
keeping  of  gunpowder  was  prohibited,  it  was  held  that  this 
prohibition,  on  account  of  the  punctuation,  was  qualified  by 
the  general  phrase  at  the  end  of  the  condition,  "  in  quanti- 
ties exceeding  a  barrel. "  ^ 

§  194.  AfBrmative  and  Promissory  Representations  ;  Con- 
sequences of  Breach  different.  — There  is  an  obvious  distinc- 
tion, in  the  consequences,  between  a  misrepresentation  of 
facts  existing  at  the  commencement  of  a  risk  and  a  neglect 
of  duty  in  regard  to  a  matter  occurring  afterwards ;  in  other 
words,  between  an  affirmative  and  a  promissory  misrepre- 
sentation. In  the  one  case  the  policy  never  takes  effect,  the 
risk  is  never  assumed ;  while  in  the  other  the  risk  attaches 
but  is  interrupted.  It  is  doubtless  upon  this  distinction 
that  courts  have  held  that  the  operation  of  a  policy  may  be 
suspended,  and  again,  after  an  interval  of  suspension,  be- 
come operative  and  reattach  to  the  subject  at  risk.^  No 
right  is  acquired  in  the  first  case,  while  in  the  second  a 
right  is  acquired  which  may  be  forfeited.  And  the  same  is 
true  of  a  concealment  of  a  fact  at  the  time  when  the  contract 
is  entered  into,  and  of  a  failure  to  make  known  some  fact 
which  by  the  terms  of  the  policy  is  incumbent  upon  the 
insured.* 

1  Elliott  V.  Hamilton  Mut.  Ins.  Co.,  13  Gray  (Mass.),  139.  See  also  ante, 
§§  166,  176. 

2  Insurance  Co.  v.  Slaughter,  12  Wall.  (U.  S.)  404.     See  also  post,  §  243. 

3  Ante,  §  101. 

*  Kimball  v.  jEtua  Ins.  Co.,  9  Allen  (Mass.),  540;  Obermeyer  v.  Globe  Ins. 
Co.,  43  Mo.  573. 

391 


§  190]  INSURANCE  :     FIRE,    LIFE,    ACCIDENT,   ETC.  [CH.  IX. 

S  195.  Test  of  Materiality,  when  Question  for  Jury.  — 
Where  there  is  a  warranty,  no  question  of  materiality  of 
the  fact  warranted  to  exist  or  stipulated  for,  to  be  done  or 
omitted,  arises.  But  this  question  always  arises  where  the 
fact  in  dispute  is  alleged  to  be  a  misrepresentation  or  con- 
cealment, except  where  it  is  converted  into  a  warranty,  by 
a  stipulation  that  an  untrue  answer  shall  avoid  the  policy. 
And  that  is  material  which,  if  known  to  the  insurer  at  the 
time  when  the  contract  was  under  negotiation,  would  natu- 
rally and  probably  have  induced  him  either  to  decline  the 
risk,  or  to  have  taken  it  only  upon  terms  more  advantageous 
to  himself.^  And  where  this  materiality  depends  upon  cir- 
cumstances, and  is  an  inference  to  be  drawn  from  such  cir- 
cumstances, and  not  upon  the  construction  of  some  writing, 
it  is  a  question  of  fact  for  the  jury.^ 

§  196.  Pact  material,  though  not  directly  relating  to  the 
Risk.  —  And  whether  the  misrepresentation  or  concealment 
relates  to  the  risk  itself  directly,  or  to  some  incidental  mat- 
ter from  which  some  inference  may  be  drawn  as  to  the  pro- 
priety of  accepting  or  declining  the  risk,  the  result  is  the 
same.  If  a  party  makes  answers  or  representations  touch- 
ing such  incidental  matters,  —  as,  for  instance,  relative  to 
his  pecuniary  means  or  social  or  business  relations,  —  of 
such  a  character  that  if  they  had  not  been  made  the  insurers 
would  have  declined  the  risk,  —  a  question  to  be  submitted 
to  the  jury,  —  then  the  policy  will  be  void.  This  point  is 
well  illustrated  by  the  remarkable  case  of  Valton  v.  National 
Loan  Fund  Life  Assurance  Society,^  where  Schumacher,  who 
was  a  partner  with  Martin  and  Valton,  insured  his  life,  and 
assigned  the  policy  to  them  in  case  he  should  die  pending 
the  copartnership,  unmarried,  Martin  taking  an  active  part 

1  Quin  V.  National  Ass.  Co.,  1  Jones  &  Gary  (Irish),  316 ;  Merriam  v.  Middle- 
sex Milt.  Fire  Ins.  Co.,  21  Pick.  (Mass.)  162. 

2  Columbian  Ins.  Co.  v.  Lawrence,  10  Pet.  (U.  S. )  507;  Campbell  v.  New 
Eng.  Mut.  Life  Ins.  Co.,  98  Mass.  381  ;  Huguenin  v.  Rayley,  6  Taunt.  186  ;  Mor- 
rison V.  Muspratt,  4  Bing.  60  ;  Hartman  v.  Keystone  Ins.  Co.,  21  Pa.  St.  466; 
Sibbald  v.  Hill,  2  Dow  Pari.  R.  263  ;  Catlin  v.  Springfield  Fire  Ins.  Co.,  1  Sum. 
(U.  S.  C.  Ct.)  434  ;  Mut.  Benefit  Life  Ins.  Co.  v.  Miller,  39  Ind.  475  ;  Washing- 
ton  Life  Ins.  Co.  v.  Haney,  10  Kans.  525. 

8  20  N.  Y.  32.     See  also  Higbie  v.  Guardian  Mut.  Life  Ins.  Co.,  53  id.  603. 

392 


CH.  IX.]  EEPRESENTATION.  [§196 

in  effecting  the  insurance.  It  was  held  that  the  insurer's 
judgment  was  the  vital  consideration  as  to  the  materiality 
of  a  representation  in  respect  to  his  inducements  to  under- 
take the  risk.i 

1  Upon  this  point  tlie  court  observed  as  follows: — "The  judge,  among  other 
things,  charged  the  jury  that  if  the  insured  untruly  represented  that  he  was  a 
partner  of  the  firm  of  Valton,  Martin,  &  Company,  or  that  if  he  untruly  repre- 
sented that  he  was  the  moneyed  man  of  the  firm,  and  either  or  both  of  such 
untrue  representations  were  material  to  the  risk,  then  the  policy  was  avoided, 
and  there  could  be  no  recovery.  That  if  Schumacher  was  dead  in  September, 
1850,  and  his  occupation  that  of  a  merchant  at  the  time  the  proposals  were 
signed,  and  the  representations  of  his  being  a  partner,  or  the  moneyed  man  of  the 
firm,  were  either  not  untrue  or  not  material  to  the  risk,  then  the  action  was 
2rrima  facie  sustained.  The  defeiidants'couusel  requested  the  court  to  charge  the 
jury  that  if  Schumacher  himself,  or  by  Martin  in  his  behalf,  represented  to  the 
agent  of  the  defendants  that  Schumacher  was  a  partner  of  the  firm  of  Valton, 
Martin,  &  Company,  when  in  fact  at  that  time  he  was  not  such  partner,  and  if  the 
defendants  would  not  have  issued  the  policy  if  the  representation  had  not  been 
made,  then  the  policy  was  void,  and  the  plaintiffs  could  not  recover.  The  judge 
declined  so  to  charge,  and  the  defendants'  counsel  excepted.  The  defendants' 
counsel  also  requested  the  judge  to  charge  the  jury  that  if  they  found  that  Schu- 
macher himself,  or  by  Martin  in  his  behalf,  represented  to  the  agent  of  the  defen- 
dants that  Schumacher  was  the  moneyed  man  of  the  concern  of  Valton,  Martin,  & 
Company,  when  in  fact  at  that  time  he  was  not  such,  and  that  the  defendants 
would  not  have  issued  the  policy  if  the  representations  had  not  been  made,  then 
the  policy  is  void,  and  the  plaintiffs  cannot  recover.  The  judge  refused  so  to 
charge,  and  the  defendants'  counsel  excepted.  The  charge  of  the  judge  was  cor- 
rect as  far  as  given.  If  the  representations  were  made,  and  false,  the  falsity  must 
have  been  known  to  Schumacher  and  Martin.  The  facts  were  within  their  knowl- 
edge, and  the  representations  fraudulent.  The  requests  to  charge,  considered  in 
connection  with  the  charge  given,  present  the  question  whether  fraudulent  repre- 
sentations made  by  the  assured  to  the  insurer  upon  his  application  for  a  policy, 
though  not  material  to  the  risk,  yet  material  in  the  judgment  of  the  insurer,  and 
which  induced  him  to  take  the  risk,  will  avoid  the  policy.  This  question  has 
not  been  determined  by  any  adjudged  case  in  this  State,  so  far  as  I  have  been 
able  to  discover.  The  elementary  writers  hold  that  the  policy  may  be  avoided. 
1  Arnould  on  Insurance,  §  189  (original  paging,  487-576)  ;  2  Duer,  681-683;  3 
Kent,  Com.  282.  In  Sibbald  v.  Hill,  2  Dow's  Pari.  R.  263,  it  was  held  that 
where  the  assured  fraudulently  represented  to  the  underwriter  that  a  prior  insur- 
ance by  another  underwriter  upon  the  same  risk  had  been  made  at  a  less  premiunr 
than  it  was  in  fact  made,  the  policy  was  vitiated.  In  this  case  it  is  ob'S'ious  that 
the  risk  itself  was  not  affected  by  the  representations.  Lord  Eldon,  in  his 
opinion,  says  that  it  appeared  to  him  settled  law,  that  if  a  person  meaning  to 
effect  an  insurance  exhibited  a  policy  underwritten  by  a  person  of  skill  and  judg- 
ment, knowing  that  this  would  weigh  with  the  other  party  and  disarm  the  ordi- 
nary prudence  exercised  in  the  common  transactions  of  life,  and  it  turned  out 
that  this  person  had  not  in  fact  underwritten  the  policy,  or  had  done  so  under 
such  terms  that  he  came  under  no  obligation  to  pay,  it  appeared  to  him  to  be 
settled  law  that  this  would  vitiate  the  policy.  The  courts  in  this  country  would 
say  that  this  was  a  fraud;  not  on  the  ground  that  the  misrepresentation  affected 

393 


§  198]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.         [CH.  IX. 

§  197.  False  Pretence.  —  It  appears,  therefore,  to  be  the 
rule  that  a  misrepresentation,  though  not  bearing  upon  the 
character  of  the  risk,  if  such  as  to  mislead  the  insurers  into 
taking  a  risk  which  otherwise  would  not  have  been  taken 
is  as  fatal  to  the  validity  of  the  policy  as  if  it  had  related 
to  the  nature  of  the  risk.  Thus,  by  way  of  additional  illus- 
tration, where  one  insurance  company  applied  to  another  for 
reinsurance  on  certain  articles  of  personal  property,  and  in- 
duced the  reinsurers  to  believe  that  they  had  insurance  on 
the  buildings,  which  was  not  the  fact,  the  policy  was  held 
to  be  void.i  This  is,  however,  not  strictly  a  misrepresenta- 
tion of  facts  upon  which  the  value  of  the  risk  is  determined, 
but  rather  a  false  pretence  of  a  fact  which  induces  the  in- 
surer to  take  the  risk  without  inquiry  as  to  its  value.  If 
the  false  pretence  does  not  induce  the  contract,  it  is  imma- 
terial. ^  So  where  the  reinsurer  declared  his  intent  to  retain 
a  portion  of  the  risk,  but  subsequently  reinsured  that,  the 
first  reinsurance  was  held  to  be  void.^ 

§  198.  Representation  ,  Substantial  Compliance ;  Equivalents. 
^  A  representation  is  substantially  complied  with  by  the 
adoption  of  precautions,  which,  if  not  those  exactly  stated 
in  the  application,  may  be  such  as  tend  to  accomplish  the 
same  purjjose  and  are  regarded  as  equally  efificacious.  Thus, 
if  benzine  be  prohibited  in  the  policy,  and  permitted  in  an 
indorsement  thereon,  to  the  amount  of  one  barrel  to  be  kept 
in  tin  cans,  keeping  the  whole  in  one  tin  can  is  a  substantial 
compliance,  if  that  is  shown  to  be  equally  safe.*     So  if  ashes 

the  nature  of  the  risk,  but  because  it  induced  a  conlidence  without  which  the 
party  would  not  have  acted.  The  principle  of  this  case,  when  applied  to  the  one 
under  consideration,  shows  that  the  judge  committed  an  error  in  refusing  to 
charge  as  ret^uested.  It  is  clear  that  the  circumstance  of  a  party  being  engaged 
in  commercial  business,  possessed  of  large  means,  might  induce  an  insurer  to 
make  an  insurance  upon  his  life  for  a  large  amount,  while  were  he  a  mere  porter 
the  risk  would  be  rejected,  although  the  chance  of  life  would  be  as  good  in  the 
latter  situation  as  the  former." 

1  Louisiana  Mut.  Ins.  Co.  v.  New  Orleans  Ins.  Co.,  13  La.  An.  246.  See  also 
Sibbald  v.  Hill,  2  Dow  Pari.  R.  263 ;  Bennett  v.  Anderson,  3  Big.  Life  &  Ace. 
Ins.  Cas.  342. 

2  Canada  Ins.  Co.  v.  Northern  Ins.  Co.,  2  Out.  App.  Rep.  373. 

3  Trail  v.  Baring,  4  Giff.  (Ch.)  485  ;  s.  c.  2  Big.  Life  &  Ace.  Ins.  Cas.  644. 

4  Maryland  Fire  Ins.  Co.  i;.  Whiteford,  31  Md.  219. 

.-^94 


CH.  IX.]  REPRESENTATION.  [§  199 

are  stated  to  be  kept  in  brick,  if  they  are  kept  in  some  other 
mode,  equally  safe,  the  policy  will  not  be  avoided. i  Where 
the  stipulation  is  a  representation  and  not  a  warranty,  there 
is  room  for  the  substitution  for  equivalents  amounting  to  a 
substantial  performance;  while  if  it  be  a  warranty  it  is  at 
least  doubtful  whether  the  doctrine  can  or  ought  to  have 
any  place,  as  one  of  the  objects  of  a  warranty  is  to  obviate 
the  necessity  of  dispute  about  the  materiality  or  immate- 
riality of  a  particular  act.  By  a  substantial  compliance  is 
meant  the  adoption  of  precautions,  intended  for  the  same 
purpose,  adapted  to  it,  and  which  may  be  reasonably  re- 
garded as  equally  or  more  efficacious.  For  instance,  when 
it  is  said  that  ashes  are  taken  up  in  iron  hods,  it  would  be 
a  substantial  compliance  if  brass  or  copper  were  used  in- 
stead. So  if  it  be  represented  that  casks  of  water,  with 
buckets,  are  kept  in  each  story  of  the  building  insured,  if  a 
reservoir  be  placed  above,  with  pipes  to  convey  water  to  each 
story,  and  regarded  by  skilful  and  experienced  persons  to  be 
equally  efficacious,  it  would  be  a  substantial  compliance. ^ 

§  199.  Means  of  Putting  out  Fires  ;  ^  Substantial  Compliance  ; 
Good  Faith.  — While  courts  will  sometimes  sustain  a  merely 
literal  and  colorable  compliance  with  a  warranty  as  suffi- 
cient,* yet  where  representations  are  made  as  a  full,  just, 
and  true  exposition  of  all  facts  and  circumstances  material 
to  the  risk,  in  construing  them,  whether  as  to  existing  facts 
or  as  to  future  precautions  to  be  taken,  both  good  faith  and 
the  terms  of  the  contract  require  that  there  shall  be  a  sub- 
stantial, as  well  as  literal,  conformity.  Such  representa- 
tions must  be  construed  with  reference  to  the  known  and 
obvious  requirements  and  purposes  of  the  insurers,  and  so 
as  to  meet  these  requirements,  and  conform  to  them,  if  such 
a  construction  can  be  made  without  violence  to  the  language 
used.  If,  for  example,  inquiries  are  made  relative  to  the 
appliances  for  extinguishing  fire  in  a  factory,  and  it  is  an- 
swered that  water  casks  are  kept  in  each  room,  while  the 

1  Underhill  v  Agawam  Mut.  Ins.  Co.,  6  Gush.  (Mass.)  440. 

2  Houghton  V.  Manufacturers'  Mut.  Fire  Ins.  Co.,  8  Met.  (Mass.)  114. 
8  LSee  §  157.]  *  Ante,  §  178. 

395 


§  199]         insurance:  fire,  life,  accident,  etc.        [ch.  ix. 

answer  would  be  literally  true  if  no  water  were  kept  in  the 
casks,  or  if  the  casks,  though  kept  filled  with  water,  were 
few  in  number  or  so  insignificant  in  size  as  to  afford  practi- 
cally no  security  in  the  sense  understood  and  required  by 
the  insurers,  this  would  not  be  a  full,  just,  and  true  state- 
ment of  the  facts,  nor  a  substantial  compliance  with  the 
undertaking  of  the  insurer.  That  undertaking  requires  a 
substantial  compliance,  by  keeping  a  cask  or  casks  of  water, 
of  a  size  adequate  to  the  required  security,  and  holding  a 
sufficient  quantity  of  water  to  aid  essentially  in  extinguish- 
ing a  fire  in  its  early  stages  in  that  part  of  the  building. ^ 
And  the  same  good  faith  requires  that  these  casks  should  be 
kept  supplied  with  water,  though  the  fact  that  from  the  neg- 
ligence of  servants,  or  from  freezing  or  other  unavoidable 
cause,  they  might  be  rendered  temporarily  unserviceable, 
would  not  avoid  the  policy,  if  reasonable  diligence  be  used 
in  restoring  them  to  a  serviceable  condition;^  nor  if  it  be 
represented  that  one  of  the  appliances  for  extinguishing  fires 
be  hose  attached  to  a  flume  above  the  mill,  does  this  imply 
an  agreement  that  there  shall  always  be  water  in  the  flume, 
as,  for  instance,  in  the  contingency  of  a  drought. ^  [The 
adequacy  of  a  water  supply  warranted  to  be  kept  on  top  of 
the  house  is  for  the  jury.  A  tank  two  feet  by  three  by  three 
on  the  roof  just  below  the  apex,  is  not  insufficient  as  a  mat- 
ter of  law.*]  And  if  a  policy  be  delivered  and  become  opera- 
tive upon  a  promissory  warranty  that  certain  appliances  for 
extinguishing  fires  are  to  be  put  in,  this  amounts  at  most  to 
an  agreement  that  they  shall  be  put  in  within  a  reasonable 
time ;  and  the  company,  having  the  right  to  cancel  the  pol- 
icy, should  so  elect  and  notify  the  insured,  else  they  cannot 
avoid  liability  on  account  of  unreasonable  delay. ^ 

1  Houghton  V.  Manufacturers'  Mut.  Fire  Ins.  Co.,  8  Met.  (Mass.)  114;  Garrett 
V.  Prov.  Ins.  Co.,  20  U.  C.  (Q.  B.)  200. 

2  Aurora  Fire  Ins.  Co.  v.   Eddj^,   49  111.  106 ;  Daniels  v.  Hudson  River  Fire 
Ins.  Co.,  12  Cush.  (Mass.)  416. 

3  Le  Roy  v.  Park  Ins.  Co.,  39  N.  Y.  56.     And  see  mite,  §  171. 

*  [Sierra  Milling,  &c.  Co.  v.  Hartford  Fire  Ins.  Co.,  76  Cal.  235.] 
5  Howell  V.  Hartford  Fire  Ins.  Co.,  U.  S.  C.  Ct.  North  Dist.   111.,   1873,  per 
Blodgett,  J.,  3  Ins.  L.  J.  649. 

396 


CH.  X.]  OF   CONCEALMENT, 


CHAPTER   X. 

OF   CONCEALMENT. 

Analysis. 

1. 

§  200.  A  concealment  is  the  intentional  (not  merely  inadvertent)  with- 

holding of  some  material  fact  which  in  good  faith  the  insurer 
ought  to  know  ;  see  also  §  207. 

The  burden  of  proof  as  to  materiality  is  on  the  company,  and 
the  question  is  for  the  jury.  Expert  may  be  asked  if  the 
fact  would  increase  the  premium,  §  200  n. 
N§§  201-206.  If  truth  and  fubicss  are  warranted  the  questions  of  intent,  inadver- 
tence or  ignorance  do  not  arise.  The  knowledge  of  his  agent 
of  a  fact  unknown  to  the  insured  has  been  imputed  to  him 
to  avoid  such  a  policy,  §§  201,  206. 

Where  the  agent  does  not  act  in  the  transaction  to  which  the 
notice  relates  his  knowledge  is  not  imputed  to  the  principal, 
§  122  n. 

The  better  opinion  does  not  hold  the  insured  for  lack  of  stat- 
ing what  he  without  fault  does  not  know,  or  what  he  has  a 
right  to  believe  immaterial,  presuming  him  to  know  and  be- 
lieve what  men  of  ordinary  intelligence  know  and  believe 
under  similar  circumstances,  §  203. 

Knowledge  of  the  insured  a  question  for  the  jury,  §  202. 

Cases  harmonized  on  their  facts,  §§  203,  205. 

2. 

§  207.  Facts  known  to  the  insurer  or  his  agent  or  which  ought  to  be 

known  to  him  (the  means  of  information  being  in  his  pos- 
session to  the  knowledge  of  both  parties,  or  usage  or  general 
public  knowledge  being  sufficient  to  inform  him),  facts 
■which  lessen  or  do  not  increase  the  risk  and  remotely  con- 
nected details  not  inquired  about,  need  not  be  stated  ;  see 
also  §  215  B. 

If  inquiry  is  made,  concealment  is  fatal  though  the  fact  is  not 
material. 

The  knowledge  of  the  company  must  be  as  definite  as  that  of 
the  assured  to  excuse  non-disclosure.  If  a  fact  concealed 
comes  to  company's  knowledge  before  issue  of  policy  it  is 
bound  by  the  issue. 

If  no  inquiries  are  made  the  insured's  mtent  is  an  essential 
question. 

Less  strictness  in  fire  than  in  marine  insurance,  for  in  the  for* 

397 


INSURANCE ;   FIRE,  LIFE,   ACCIDENT,   ETC.  [CH.  X. 

mer  the  insurer  is  less  dependent  on  the  insured  for  informa- 
tion. 

c  208.  Threats  of  burning  or  attempts  to  set  on  fire  the  house  insured,  or 

a  neighboring  one,  must  be  disclosed. 
Informing  the  agent  is  sufficient  if  no  questions  are  asked  in 

the  application. 
Facts  occurring  after  issue  of  a  policy  must  be  notified  to  com- 
pany, if  by-laws  that  are  made  part  of  the  contract  so  re- 
quire. 

«  209.  A  general  statement  of  the  facts  sufficient  to  put  the  insurers 

on  inquiry  is  enough.     Mere  idle  talk  not  wortliy  of  the 
regard  of  a  prudent  person  need  not  be  communicated. 

3. 

§§  210,  211.  When  there  is  room  for  opinion,  an  honest  view  such  as  a  man  of 
ordinary  prudence  and  intelligence  M'ould  take  under  the 
circumstances,  though  an  erroneous  one  as  it  may  afterward 
prove,  is  no  misrepresentation,  especially  if  the  company's 
agent  arrived  at  a  similar  judgment,  §  211. 
as  "  What  houses  endanger  the  one  insured  ?"  or  "Is  there  a 
livery-stable  in  vicinity  V  or  "Have  you  had  any  serious 
illness  ?  "  or  "  one  tending  to  shorten  life  ?  " 

§  212.  An  equivocal  answer,  or  statement  of  only  part  of  the  truth  may 

be  a  concealment. 

4. 

§  213.  Agent's  concealment  imputed  to  principal  ;  but  one  simply  referred 

to  by  the  insured,  who  merely  states  his  belief  in  their  truth, 
cannot  prejudice  him  by  misrepresentations  or  concealment  un- 
known to  him.  Broker  to  procure  is  agent  of  assured ;  one  in- 
surance agent  going  to  another  of  his  own  notion,  not. 

§  214.  Where  A  insures  the  life  of  B,  statements  concerning  his  health  by 

the  person  whose  life  is  insured  (B)  made  at,  or  about  the  time 
when  he  signed  the  application,  have  been  admitted  on  the 
ground  that  they  were  a  part  of  the  res  gestce.  If  made  long  be- 
fore or  after  the  application  they  are  not  admissible,  for  the  de-  ' 
clarant  is  not  a  party  in  interest  to  the  contract,  nor  an  agent  of 
the  insured. 

§  215  D.  Ordinary  diligence  in  sending  information  is  all  that  is  required, 

though  a  special  message  might  have  saved  the  company. 

5. 

Matters  not  material,  unless  made  so  by  agreement  or  inquiry  : 
prior  insurance,  §  207. 

threat  of  burning  some  months  before  during  election  excite- 
ment, §  208. 

idle  talk,  §  209. 
character  of  tenants,  §  207. 

or  of  adjoining  buildings,  §  207. 
erection  of  new  building,  §  207. 
personal  dislike  to  insured,  §§  207,  215  B. 
pending  litigation,  §  207. 

398 


CH.  Xj  OF   CONCEALMENT.  [§  200 

how  building  is  heated  or  lighted,  §§  207,  215  B. 

void  tax  title,  §  207- 

damaged  goods  oa  board,  §  207. 

minor  details,  §  207. 

insured's  opinion  as  to  derangement  of  functions,  §  215. 

incumbrance  in  case  of  insurance  in  stock  company,  §  215. 

insured  insolvent,  §  215  B. 

risk  in  same  block  declined,  §  215  B. 

agreement  between  mortgagor  and  mortgagee  as  to  payment  of 
premium,  §  215  B. 

brick  oven,  §  215  C 

fact  decreasing  risk,  §  215  C. 

sensations,  apprehensions,  §  215  C. 

opinions,  §§  210,  211. 

disclosure  of  fact  in  reference  to  which  there  is  a  warranty,  is 
unnecessary,  §  215  C. 
Material  facts : 

threats  of  burning  in  general  or  attempts  to  set  the  house  or 
a  neighboring  one  on  fire,  §  208  ;  but  see  §  207. 
idle  talk  not  material,  §  209. 

single  woman  had  child  year  or  two  before,  §  215. 

pregnancy,  §  215. 

incumbrance  in  case  of  mutual  insurance,  §  215. 

prior  applications,  §  215,  but  see  §  188  C. 

warehouse  erected  within  forty-one  feet,  §  215  A. 

benziue  in  adjoining  building,  where  policy  prohibits,  §  215  A. 

probable  loss  of  vessel,  §  215  A. 
Materiality  a  question  for  jury  : 

carpenter  work  going  on,  §  207. 

double  occupancy  of  house,  §  207. 

assured  in  prison,  §  215. 

insane  twenty  years  before,  §  215. 

release  of  carrier  from  liability,  §  215  A. 
In  France,  where  concealment  not  sufficient  to  avoid  policy  the  com- 
pany may  deduct  the  additional  premium  that  would  have  been 
charged  if  the  truth  had  been  known,  §  215  B. 

§  200.  Concealment  defined.  —  Representations  should  not 
only  be  true,  but  they  should  be  full.  The  insurer  has  a 
right  to  know  the  whole  truth.  And  a  lack  of  fulness,  if 
designed,  in  a  respect  material  to  the  risk  is  tantamount  to 
a  false  representation,  and  is  attended  by  like  consequences. 
This  lack  of  fulness  is  termed  a  concealment,  which  is  the 
designed  and  intentional  withholding  of  some  fact  material^ 

1  [When  the  company  sets  up  concealment  as  a  defence,  the  burden  is  on  it 
to  show  materiality.  Insurance  Co.  v,  Folsom,  18  Wall.  237,  253.  The  ques- 
tions of  materiality,  facts,  and  non-disclosure  are  for  the  jury.  New  York  Fire- 
men's Ins.  Co.  V.  Walden,  12  Johns.  513,  520  ;  Richmondville  Union  Seminary  v. 

399 


§200] 


INSURANCE  :   FIRE,   LIFE,   ACCIDENT,   ETC. 


[CH.  X. 


to  the  risk  which  the  insured  in  honesty  and  good  faith 
ought  to  communicate  to  the  insurer,  (a)  It  is  not  mere 
unintentional  silence  or  inadvertence.  It  is  a  positive  in- 
tentional omission  to  state  what  the  applicant  knows,  or 
must  be  presumed  to  know,  ought  to  be  stated.  It  is  a  sup- 
pression of  the  truth  whereby  the  insurer  is  induced  to  enter 
into  a  contract  which  he  would  not  have  entered  into  had 

Hamilton  Ins.  Co.,  14  Gray,  459,  465  ;  Von  Lindeneau  v.  Desborough,  3  C.  & 
P.  353,  356.  Whether  particuhir  facts  if  disclosed  to  an  underwriter  would,  in 
the  opinion  of  a  witness  conversant  with  the  business  of  insurance,  as  a  mat- 
ter of  judgment,  make  a  difference  as  to  the  amount  of  premium,  is  admissible 
evidence.  But  he  cannot  be  asked  what  he  himself  would  probably  have  done 
under  the  circumstances.     Berthou  v.  Loughman,  2  Stark.  258,  259.] 


{a)  See  Niagara  F.  Ins.  Co.  v.  Miller, 
120  Penn.  St.  504  ;  Queen  Ins.  Co.  v. 
Young  (86  Ala.),  11  Am.  St.  Rep.  51, 
58.  The  obligations  of  good  faith  also 
require  the  insurer  to  deal  openly  and 
fairly  with  the  insured.  In  Michigan 
the  law  is  thus  defined  by  McGrath,  J., 
in  Hartford  Steam  Boiler  Insp.  &  Ins. 
Co.  v.  Cartier,  89  Mich.  41,  48  ;  "  Condi- 
tions and  restrictions  in  insurance  poli- 
cies, to  be  binding  upon  the  insured, 
must  be  inserted  without  fraud,  misrep- 
resentation, or  concealment.  In  order 
to  charge  the  insured  with  the  duty  of 
a.n  examination  of  his  policy  with  refer- 
ence to  new  matter  introduced  into  it, 
he  nmst  be  left  free  to  discharge  that 
duty  unaffected  by  the  company's  repre- 
sentations, and  not  be  led  to  neglect  it 
by  the  conduct  of  the  company  itself. 
The  company  cannot  be  allowed  to 
evade  his  questions,  mislead  him,  sup- 
press the  truth,  and  lull  him  to  sleep 
regarding  new  restrictions  which  it  has 
injected  into  the  policy,  and  thereafter 
charge  him  with  constructive  knowl- 
edge of  those  restrictions." 

In  this  case,  where  the  insured  can- 
celled a  policy  in  the  H.  Company  ac- 
cording to  its  terms,  and  substituted 
one  in  another  company  at  a  lower  rate, 
and  the  agent  of  the  H.  Company  in- 
duced him  to  cancel  the  latter  and 
accept  another  in  the  H.  Company  at 
still  lower  rates,  but,  unknown  to  the 

400 


insured,  the  last  policy,  unlike  the  first, 
provided  that,  if  cancelled  to  take  out 
insurance  in  another  company,  the 
premium  should  be  forfeited,  and  on 
being  told  that  the  other  company 
would  grant  a  yet  lower  rate,  the  agent 
merely  said  that  they  would  not  be  able 
to  do  so,  it  was  held,  in  an  action  by 
the  H.  Company  to  recover  the  pre- 
mium on  the  cancellation  by  the  insured 
of  the  last  policy,  that  there  had  been 
concealment  by  the  agent,  and  that  the 
provit^ion  against  cancellation  was  in- 
valid. As  to  insured's  duty  to  read  his 
policy,  see  supra,  §  144  D,  note  (a). 

Neglect  to  answer  a  question  is  not 
a  fraudulent  concealment.  Parker  v. 
Otsego  County  Farmers'  Co-op.  F.  Ins. 
Co.,  62  N.  Y.  S.  199.  Tlie  Code  of 
Iowa  providing  that  a  qopy  of  the  appli- 
cation shall  be  attached  to  the  policy, 
and  that  neglect  shall,  not  render  the 
contract  invalid,  but  such  application 
or  falsity  thereof  cannot  be  pleaded  or 
proved  by  the  company,  nor  be  necessary 
to  recovery  by  insured,  who  may  plead 
or  prove  them  at  his  optiou,  does  not 
apply  to  such  representations  as  appear 
on  the  face  of  the  policy  ;  and  where 
the  latter  required  the  title,  if  less  than 
the  fee,  to  be  so  expressed  thereon,  fail- 
ure to  attach  the  application  will  not 
prevent  the  company  from  showing  con- 
cealment. MacKinnon  v.  Mutual  F. 
Ins.  Co.,  89  Iowa,  170. 


CH.   X.]  OF   CONCEALMENT.  [§  201 

the  truth  been  known  to  him.  It  is  a  deception  whereby  the 
insurer  is  led  to  infer  that  to  be  true,  as  to  a  material  mat- 
ter, which  is  not  true.  Hence,  strictly  speaking,  under  the 
general  law  of  insurance,  there  can  be  no  concealment  of  a 
fact  which  is  not  known  to  the  applicant. ^ 

§  201.  Where  Truth  and  Fulness  warranted,  how.  — Where, 
however,  the  truth  and  fulness  of  a  statement  are  warranted, 
it  is  no  longer  a  question  of  concealment,  but  of  the  truth 
and  fulness  of  the  statement ;  and  any  failure  to  disclose  a 
material  fact,  even  though  accidental,  and  by  inadvertence 
or  through  ignorance,  is  followed  by  the  same  consequences 
as  if  intentionally  concealed.  And  it  has  accordingly  been 
held  that  all  known  facts  material  to  the  risk,  if  called  for, 
must  be  disclosed,  whether  the  party  seeking  insurance 
think  them  material  or  not,  upon  the  ground  that  the  ques- 
tion as  to  the  belief  of  the  party  with  regard  to  the  materi- 
ality of  the  fact  would  in  many  instances  be  difficult  to 
decide,  and  it  would  encourage  suppression  if  that  were  the 
issue  upon  which  the  question  of  concealment  should  turn , 
while  if  the  materiality  alone  of  the  fact  be  made  the  issue, 
then  it  becomes  the  interest  of  the  assured  to  state  all  the 
facts  he  knows.  ^  And  since  the  knowledge  of  an  agent  may 
be  imputed  to  the  principal,  and  is  constructively  his,  he 
may  be  guilty  of  concealing  a  fact  of  which  he  has  no  actual 
knowledge.  Thus,  where  an  agent  wrote  to  his  principal  to 
cause  his  vessel  to  be  insured,  after  an  accident  which  led 

1  Sprott  V.  Boss,  16  Ct.  of  Sess.  Cas.  (Scotch)  1145  ;  s.  c.  3  Big.  Life  &  Ace, 
Ins.  Cas.  421  ;  Eoss  v.  Bradshaw,  1  W.  Bl.  312  ;  s.  c.  4  Big.  Life  &  Ace.  Ins.  Cas. 
574  ;  Swete  v.  Faiilie,  6  C.  &  P.  1  ;  Hall  v.  People's  Mut.  Ins.  Co.,  6  Gray  (Mass.), 
185  ;  Merchants'  &  Manufacturers'  Ins.  Co.  v.  Wash.  Mut.  Ins.  Co.,  1  Hand 
(Ohio),  408  ;  Mut.  Benefit  Life  Ins.  Co.  v.  Robertson,  59  111.  123  ;  Gerhauser  v. 
North  B.  &  M.  Ins.  Co.,  7  Nev.  174  ;  Forbes  v.  Ed.  Life  Ass.  Co.,  10  Ct.  of 
Sess.  Cas.  (Scotch)  451  ;  Life  Ass.  of  Scotland  v.  Foster,  11  Ct.  of  Sess.  Cas. 
3d  series  (Scotch^,  351  ;  s.  c.  4  Big.  Life  &  Ace.  Ins.  Cas.  520.  And  see  post, 
§  211  ;  Swift  V.  Mass.  Mut.  Life  Ins.  Co.,  63  N.  Y.  186.. 

,  s  2  Lindeneau  v.  Desborough,  3  Man.  &  Ry.  45  ;  Vose  v.  Eagle  Life  &  Health 
Ins.  Co.,  6  Cush.  (Mass.)  42  ;  Miles  v.  Conn.  Mut.  Life  Ins.  Co;^  3  Gray  (Mass.), 
580  ;  Geach  v.  Ingall,  14  M.  &  W.  95  ;  Mut.  Benefit  Life  Ins.  Co.  v.  Miller,  39 
Ind.  475  ;  Day  r.'^Mut.  Benefit,  &c.  Ins.  Co.  (Sup.  Ct.  D.  C),  4  Big.  Life  &  Ace. 
Ins.  Cas.  15  ;  Abbott  v.  Howard,  Hayes  (Irish),  381  ;  s.  c.  3  Big.  Life  &  Ace. 
Ins.  Cas.  294.     See  also  post,  §  206. 

VOL.1. —26  401 


§  202]  INSURANCE :    FIRE,   LIFE,  ACCIDENT,   ETC.  [CH.  X. 

to  the  loss  of  the  vessel  had  happened,  but  did  not  mention 
to  his  principal,  the  owner,  the  fact  of  the  accident,  it  was 
held  that  as  the  agent  ought  to  have  communicated  the  fact 
of  the  accident,  the  concealment  was  constructively  tliat  of 
the  owner,  and  he  could  not  recover  on  a  policy  which  he 
had  effected  in  good  faith.  ^ 

§  202.  K  the  fact  be  not  known,  how.  —  On  the  other 
hand,  it  has  been  held  with  better  reason  that  there  is  no 
concealment  if  the  fact  omitted  be  not  such  as  may  be  fairly 
presumed  to  be  known  and  believed  to  be  material  by  the 
applicant. (a)  Thus,  where  the  applicant  had  been  insane 
several  years  before  he  applied  for  and  took  his  policy,  and 
had  been  placed  in  an  insane  asylum,  whence  he  was  dis- 
charged cured,  his  failure  to  state  the  fact  at  the  time  he 
procured  his  policy,  no  specific  question  being  asked,  but 
the  policy  by  its  terms  being  void  for  misrepresentation, 
fraud,  or  concealment,  was  held  not  to  prevent  a  recovery; 
and  this,  although  the  insured  had  been  for  a  considerable 
period  a  canvassing  agent  of  the  insurers,  and  in  a  conver- 
sation with  the  president  of  the  company,  some  time  before 
the  policy  was  taken  out,  had  been  told  by  him  that  they  did 
not  wish  to  insure  insane  persons,  and  had  been  instructed 
to  be  cautious  on  that  point.  The  conversation,  which  took 
place  some  time  previous  to  the  making  of  the  contract,  and 
had  for  its  object  to  give  instructions  to  the  agent,  was  held 

i  Gladstone  v.  King,  1  Maule  &  Sel.  35 ;  post,  §  202. 

(a)  The  applicant's  answers,  if  made  v.    Martin,   133  Ind.  376.     Where  the 

according  to  his  best  knowledge  and  be-  policy  provided  that  it  should  be  void 

lief,  and  accepted  by  the  insurer,  render  if  the   insured  concea-led  any  material 

it  incumbent  upon  the  latter  to  prove,  fact,  or  if  the  interest  of  the  insured  was 

that,  as  thus  limited,  the}'  are  untrue,  not  truly  stated,  the  insured  was  held 

Clapp  V.  Mass.  Benefit  Ass'n,  146  Mass.  not   bound  to  voluntarily  disclose  the 

619  ;  Cobb  v.  Covenant   Mut.  Benefit  existence  of  a  mortgage  in  the  absence 

Ass'n,  153  Mass.  176.     A  statement  in  of  any  question  or  representation  affect- 

the   application   that  the   insured  has  ing  it.     Morotock  Ins.  Co.  v.   Rodefer, 

never  been  physically  injured  is  not  a  92  Va.  747.     The  concealment  of  an  in- 

misrepresentation  which  will  avoid  for-  ventory  from  an  adjuster  is  not  the  con- 

feiture  where   it   appears   that  injuries  cealment   of  a  "material  fact  "  within 

were  sustained  at  an  earlier  period  of  life,  the  policj',  unless  the  company   is  in- 

the  effects  of  which  have  wholly  disap-  jured   thereby.      Commercial   Bank   v, 

peared.     Standard  Life  &  Ace.  Ins.  Co.  Firemen's  Ins.  Co.,  87  Wis.  297. 

402 


CH.  X.]  OF   CONCEALMENT.  [§  202 

to  have  no  tendency  to  show  a  fraudulent  concealment  of 
material  facts,  unless  it  could  also  be  shown  that  the  facts 
omitted  were,  in  the  judgment  of  the  insured,  material.^ 
So  where,  if  the  answers  were  in  any  respect  untrue,  the  pol- 
icy was  to  be  void,  and  the  question  was  whether  the  appli- 
cant had  any  sickness  within  the  last  ten  years,  and  the 
answer  was  that  he  had  had  pneumonia,  but  said  nothing  of 
a  "slight  attack  of  chronic  pharyngitis,"  it  was  held  to  be 
no  concealment,  as  the  party  was  not  bound  to  state  such 
facts  as  would  ordinarily  be  deemed  immaterial,  such  as 
that  he  had  had  a  cold,  or  a  diarrhrea,  or  an  irritation  of 
the  throat,  not  fairly  embraced  in  what  is  popularly  under- 
stood as  sickness. 2  In  Hutchison  v.  National  Loan  Assur- 
ance Society,  3  a  warranty  that  the  insured  had  no  disease  or 
symptom,  of  disease  was  held  to  import  only  that,  according 
to  the  knowledge  and  reasonable  belief  of  the  insured,  there 
was  freedom  from  any  disease  or  symptom  of  diseases  mate- 
rial to  the  risk,  —he  not  being  guilty  of  any  negligence  in 

1  Mallory  v.  Travelers'  Ins.  Co.,  47  N.  Y.  52. 

2  Mat.  Benefit  Life  Ins.  Co.  v.  Wise  (Md.),  2  Big.  Life  &  Ace.  Ins.  Cas.  43  ; 
s.  c.  affirmed,  34  Md.  582. 

3  7th  Ct.  of  Sess.  Cas.  (Scotch)  467  ;  Duckett  v.  Williams,  2  Cr.  &  Mee.  348, 
distinguished.  See  also  Life  Ass.  of  Scotland  v.  Foster,  11  Ct.  of  Sess.  Cas.  3d 
series,  351  ;  s.  c.  4  Big.  Life  &  Ace.  Ins.  Cas.  520,  where  the  rule  is  thus  well  stated : 
"Concealment  or  non-disclosure  of  material  facts,  by  a  person  entering  into 
a  contract  is,  generally  si^eaking,  either  fraudulent  or  innocent,  and  in  the 
case  of  such  contracts  where  parties  are  dealing  at  arm's-length,  that  which  is 
not  fraudulent  is  innocent.  But  contracts  of  insurance  are  in  this,  among  other 
particulars,  exceptional,  that  they  require  on  Loth  sides  iiherriwa  fides.  Hence 
without  any  fraudulent  intent,  and  even  in  bona  fides,  the  insured  may  fail  in  the 
duty  of  disclosure.  His  duty  is  carefully  and  diligently  to  review  all  the  facts 
known  to  himself  bearing  on  the  risk  proposed  to  the  insurers,  and  to  state 
every  circumstance  which  any  reasonable  man  might  suppose  could  in  any  way 
influence  the  insurers  in  deciding  whether  they  will  enter  into  the  contract. 
Any  negligence  or  want  of  fair  consideration  for  the  interests  of  the  insurers 
on  the  part  of  the  insured  leading  to  the  non-disclosure  of  material  facts,  though 
there  be  no  dishonesty,  may  therefore  constitute  a  failure  in  the  duty  of  dis- 
closure which  will  lead  to  the  voidance  of  the  contract.  The  fact  undisclosed 
may  not  have  appeared  to  the  insured  at  the  time  to  be  material,  and  yet  if  it 
turns  out  to  be  material,  and  in  the  opinion  of  a  jury  was  a  fact  that  a  reason- 
able and  cautious  man  proposing  insurance  would  think  material  and  proper 
to  be  disclosed,  its  uon-disclosure  will  constitute  such  negligence  on  the  part  of 
the  insured  as  to  void  the  contract."  A  covenant  not  to  violate  an}'  condition 
of  the  policy  means  any  hioicn  condition.  Vyse  v.  Wakefield  (Ex.  Ch.),  6  M.  & 
W.  442  ;  s.  c.  3  Big.  Life  &  Ace.  Ins.  Cas.  17. 

403 


§  202]  INSUKANCE  :   FIRE,   LIFE,   ACCIDENT,    ETC.  [CH.  X. 

acquiring  knowledge  of  his  own  condition.  So  in  Jones  v. 
Provincial  Insurance  Company,  it  was  stated  by  the  appli- 
cant that  he  was  not  "  aware  of  any  disorder  or  circumstance 
tending  to  shorten  life,"  when  in  fact  he  had  had,  within  a 
year  or  two,  two  severe  bilious  attacks,  about  the  tendency 
of  which  to  shorten  life  the  physicians  who  attended  him 
differed  in  opinion.  And  it  was  said  that  if  the  assured 
honestly  believed  that  these  attacks  had  no  tendency  to 
shorten  his  life,  his  failure  to  mention  them  would  not 
avoid  the  policy.^  What  other  persons  of  intelligence  do 
not  know  or  believe  or  apprehend  cannot  reasonably  be 
expected  of  the  insured.  And  what  he  cannot  be  expected 
to  know,  he  cannot  be  considered  as  culpable  for  not  know- 
ing; and  what  he  cannot  be  expected  to  apprehend,  he  can- 
not be  bound  to  communicate;  and  in  not  communicating 
any  such  fact,  he  cannot  be  considered  as  concealing  it  even 
inadvertently,  much  less  wilfully.  ^  (a)  The  knowledge  which 
is  imputable  to  the  assured  who  undertakes  to  state  all  mate- 
rial facts,  either  absolutely  or  so  far  as  they  are  known  to 
him,  may  be  actual  or  constructive.  The  law,  however,  does 
not  undertake  to  decide  whether  this  knowledge  exists  or 
not;  it  is  rather  a  question  of  fact  for  the  jury.  The  law 
will  not  say  that  a  man  must  be  presumed  to  know  certain 
particular  facts  touching  his  estate;  but  the  question  whether 
certain  facts,  if  misrepresented  or  concealed,  were  known  to 
the  applicant  for  insurance,  is  a  question  of  fact  to  be  found 
by  the  jury  upon  the  evidence.  And  upon  this  point  divers 
considerations,  as  authorizing  the  inference  of  knowledge, 
are  fit  and  proper  to  be  submitted  to  the  jury ;  such  as,  that 
the  applicant  and  insured  is  the  owner  of  the  property,  and 
may  be  presumed  to  be  acquainted  with  its  condition;  or, 
being  the  life-insured,  is  cognizant  of  his  own  condition; 
that  the  matter  relates  to  things  open  and  visible,  things 
capable  of  distinct  knowledge,  and  not  depending  upon  esti- 

^  3  C.  B.  N.  s.  65.     See  also  post,  §  210. 

2  Dennison  v.  Thomastoii  Mut.  Ins.  Co.,  20  Me.  125,  per  Wuitman,  C.  J.     See 
post,  §§  210,  211. 

(a)  See  page  402,  note  (a). 

404 


CH.  X.]  OF   CONCEALMENT.  [§  203 

mate,  opinion,  or  mere  probability ;  things  in  respect  to 
which  an  owner  is  bound  in  honesty  and  good  faith  to  know, 
takes  upon  himself  to  know,  and  usually  does  know,  —  these 
and  all  other  pertinent  matters  of  evidence  bearing  upon  the 
question,  are  to  be  left  to  the  jury,  with  directions  that  if 
they  are  satisfied  from  all  the  evidence,  and  can  reasonably 
infer  that  the  assured  did  know  the  fact  in  regard  to  which 
misrepresentation  or  concealment  is  imputed,  they  are  to 
find  that  he  did  know  it;  otherwise  not.^ 

§  203.  The  cases  cited  in  the  last  section  are  apparently 
not  in  accord  with  Lindeneau  v.  Desborough  and  Vose  v. 
Eagle  Life  and  Health  Insurance  Company,  cited  in  the 
preceding  section.  And  certainly  the  language  of  these 
cases,  more  particularly  the  latter,  as  where  it  is  said  that, 
though  there  be  no  warranty,  the  concealment  of  a  material 
fact  will  avoid  the  policy,  though  the  concealment  be  the 
result  of  accident  or  negligence  and  not  of  design,  would 
seem  to  lay  down  an  entirely  different  and  much  more  strin- 
gent rule.  On  examination  of  the  cases,  however,  it  will  be 
seen  that  the  facts  required  no  such  decision.  In  both  cases 
the  facts  undisclosed  were  such  as  in  the  opinion  of  the 
court  the  applicant  knew  or  ought  to  have  known.  The 
question  propounded  seemed  to  Lord  Tenterden,  C.  J.,  in 
the  former  case,  to  be  one  "  calling  for  an  answer  stating  all 
the  facts  which  any  reasonable  man  might  think  material ;  " 
and  in  the  case  from  Massachusetts  the  court  say  that  the 
insured,  being  inquired  of  if  he  had  had  consumption,  "could 
have  stated  the  symptoms  of  consumption  which  he  had  and 
which  he  knew  he  had."  In  both  cases,  therefore,  facts  were 
concealed  which  were  known,  actually  or  presumptively,  to 
be  material,  and  they  were  both  no  doubt  well  decided  upon 
the  facts.     Neither  case  actually  decides  upon  its  facts  any- 

1  Houghton  V  Manufacturers'  Mut.  Fire  Ins.  Co.,  8  Met.  (Mass.)  114.  In 
Lewis  V.  Phcenix  Ins.  Co.,  39  Conn.  100,  it  was  held  that  a  statement  that  the 
applicant  had  an  insurable  interest  in  the  life  of  the  insured,  the  fact  being  that 
there  existed  the  mere  relationship  of  brother  on  the  ground  of  insurable 
interest,  was  false  and  fatal,  the  applicant  being  held  to  know  that  the  law  was 
as  the  court  then  decided  it,  although  it  was,  and  perhaps  still  is,  au  open  ques- 
tion.    See  ante,  §  107. 

405 


§  203]  INSUKANCE :   FIEE,   LIFE,   ACCIDENT,   ETC.  [CH.  X, 

thino"  more  than  that  the  insured  was  bound  to  communicate 
all  facts  known  to  him,  and  by  him  believed  to  be  material, 
presuming  that  he  knew  and  believed  what  men  of  ordinary 
intelligence  know  and  believe.  In  this  view  the  cases  are 
reconcilable.  And  perhaps  this  will  be  found  to  be  the  true 
pule,  — that  there  is  concealment  whenever  facts  are  with- 
held which  are  known,  or  which  must  be  presumed  to  be 
known,  because  they  ought  to  be  known  to  an  ordinarily 
intelligent  person,  to  be  material.  According  to  this  view, 
concealment  is  a  violation  of  good  faith,  and  not  a  mere 
error  of  opinion.  Suppose  the  applicant  is  inquired  of,  as 
in  the  Massachusetts  case,  if  he  has  consumption.  He  is, 
in  fact,  afflicted  with  a  cough.  But  a  cough  proceeds  from 
various  other  causes  as  well  as  from  a  disease  of  the  lungs. 
He  has  in  good  faith  endeavored  to  inform  himself  as  to  the 
true  causes,  and  has  been  informed  by  his  physicians  that  it 
does  not  proceed  from  the  lungs,  but  from  an  entirely  differ- 
ent cause.  It  would  seem  that  the  insured,  who  honestly 
believes,  and  has  reason  to  believe,  that  his  cough  is  due  to 
some  other  cause,  ought  not  to  lose  the  benefit  of  his  insur- 
ance, because,  when  asked  if  he  has  disease  of  the  lungs,  he 
does  not  disclose  the  fact  that  he  has  a  cough,  even  though 
it  should  ultimately  appear  that  in  point  of  fact  the  cough 
did  proceed  from  a  disease  of  the  lungs,  and  that  the  ap- 
plicant in  fact  had  consumption  when  the  insurance  was 
effected.  Before  the  insured  can  fairly  be  said  to  conceal 
the  fact  of  a  particular  disease,  when  he  does^  not  disclose 
the  fact  that  he  has  symptoms  which  may  or  may  not  indi- 
cate the  presence  of  the  disease,  it  would  seem  that  it  should 
at  least  appear  that  he  knew,  or  had  reason  to  believe,  they 
were  symptoms  of  the  disease  inquired  about.  If  the  in- 
quiry be  to  a  particular  symptom,  as  if  the  insured  has  ever 
had  "spitting  of  blood,"  the  answer  may  reasonably  be  re- 
quired to  be  absolute,  because  of  this  symptom  (of  what, 
perhaps,  he  might  not  know)  he  must  have  knowledge.^ 

1  See  also  post,  §  297.  It  is  worth}-  of  note  that  in  Mallory  v.  Travellers'  Ins. 
Co.,  cited  in  last  section,  the  court  refer  to  Lindeneau  v.  Desborough,  uhi  supra, 
as  one  of  the  authorities  upon  which  they  base  their  decision.     They  also  dis- 

40G 


CH.  X.]  OF  CONCEALMENT.  [§  204 

§  204.  And  this  seems  to  be  the  doctrine  of  Horn  v.  Ami- 
cable Mutual  Life  Insurance  Company.  ^  In  that  case  the 
applicant  was  required  to  name  the  physician  usually  em- 
ployed by  him,  and  if  he  had  none,  then  to  name  any  other 
doctor  who  could  be  applied  to  for  information  upon  the 
state  of  his  health.  He  answered,  "  None ;  "  and  the  fact 
was  that  he  had  occasionally  applied  to  one  physician  to 
prescribe  for  a  cough  of  long  standing,  accompanied  by 
shortness  of  breath,  and  had  also  secretly  applied  to  another 
insurance  company,  when  his  application  was  declined  upon 
the  examination  of  the  physician  of  that  company. 2  It  was 
held  that  as  the  applicant  must  have  known  that  both  of  the 
doctors  could  have  given  important  information  as  to  his 
health,  and  denied,  in  effect,  that  there  was  any  one  who 
could  give  that  information,  there  was,  therefore,  a  fraudu- 
lent concealment,  as  matter  of  law.  And  in  the  same  case 
the  court  proceeds  to  say  that  in  life  insurance  the  state- 
ments as  to  the  health  of  the  applicant  are  representations, 
and  not  warranties,  and  the  question  is  one  of  honesty  and 
fair  dealing;  and,  referring  to  the  case  of  Miles  v.  Connecti- 
cut Mutual  Life  Insurance  Company,^  observes  that  that  case 
is  founded  upon  no  analogous  case  of  life  insurance,  unless 
it  be  "Vose  v.  Eagle  Life  and  Health  Insurance  Company,* 
which  itself  was  decided  upon  the  ground  of  misrepresenta- 
tion as  well  as  upon  that  of  warranty,  upon  which  last 
ground  no  authority  is  cited  in  its  support.  No  such  rule, 
however,  they  proceed  to  say,  has  been  laid  down  in  New 
York,  and  they  are  unwilling  to  originate  such  a  doctrine  as 
law.     The  assured  must  state  all  he  knows  bearing  upon  the 

tinguish  the  case  from  those  where  speciSc  questions  are  put,  with  a  stipulation 
that  the  answers  shall  be  full  and  true.  They  also  cite  Eawls  i'.  Amer.  Life 
Ins.  Co.,  27  N.  Y.  282  ;  Valton  v.  National  Fund  Life  Ass.  Soc,  20  N.  Y.  32. 
See  also  Hogle  v.  Guardian  Life  Ins.  Co.,  6  Robt.  (N.  Y.  Superior  Ct.)  567  ; 
Kelsey  v.  Universal  Life  Ins.  Co.,  35  Conn.   225  ;  mife,  §  200. 

1  64  Barb.  (N.  Y.  S.  C.)  81.  This  case  suggests  that  the  same  .strictness  of 
construction  sliould  not  prevail  in  life  policies  where  knowledge  of  the  facts  in 
many  respects  cannot  be  of  the  same  certain  character  as  in  fire  and  marine 
policies. 

2  See  as  to  concealing  fact  of  prior  application,  post,  §  215. 

3  3  Gray,  580.  *  6  Cush.  42. 

407 


§  206]  INSURANCE  :     FIRE,   LITE,   ACCIDENT,   ETC.  [CH,  X. 

condition  of  bis  health,  and  any  untrue  statement  or  con- 
cealment in  this  respect  ought  justly  to  render  the  policy 
void.  In  all  respects  where  it  appears,  or  can  be  shown, 
that  the  applicant  had  any  knowledge  of  the  facts  called  for 
bv  the  interrogatories,  it  matters  very  little  whether  the  an- 
swer be  held  a  warranty  or  not,  inasmuch  as  any  untrue 
statement  will  be  a  misrepresentation  or  fraud,  which  will 
equally  avoid  the  policy. 

§  205.  Indeed,  the  case  of  Campbell  v.  New  England 
Mutual  Life  Insurance  Company  ^  seems  to  have  been  re- 
garded as  evincing  a  disposition  on  the  part  of  the  courts  of 
Massachusetts  to  modify  the  severity  of  the  rule  which  the 
language  of  the  court  in  the  case  of  Vose  v.  Eagle  Life  and 
Health  Insurance  Company  would  seem  to  require,  and 
which  was  followed  in  the  subsequent  case,  in  the  same 
State,  of  Miles  v.  Connecticut  Mutual  Life  Insurance  Com- 
pany. Thus,  in  Price  v.  Phoenix  Life  Insurance  Company,* 
which  was  a  case  very  similar  in  its  facts,  the  court  adopt 
the  views  of  the  Massachusetts  case,^  although  they  say  they 
are  well  aware  that  it  would  be  difficult,  if  not  impossible, 
to  reconcile  the  views  expressed  in  that  case  with  the  doc- 
trines laid  down  in  a  great  number  of  other  cases.* 

§  206.  Still  there  is  a  class  of  cases  where  the  insured  has 
bound  himself,  hand  and  foot,  by  a  stipulation  that  his  ap- 
plication contains  a  just,  full,  and  true  exposition  of  all  the 
facts  inquired  for,  or  its  equivalent  in  a  different  form  of 
words,  and  is  to  be  deemed  a  warranty.  Such  cases  are  to 
be  distinguished  from  those  we  have  been  considering.  In 
these,  according  to  the  received  interpretation,  no  question 
of  knowledge,  good  faith,  or  materiality  arises ;  it  is  simply 
a  question  of  the  truth  and  fulness  of  the  answers;  and  a 
want  of  either  is  fatal.  Such  policies,  under  such  an  inter- 
pretation, are  practically  no  security  at  all.  The  insured  is 
at  the  mercy  of  the  insurer;  and,  if  the  applicant  will  be  so 
imprudent  as  to  make  such  a  bargain,  the  courts  cannot  help 


1  98  Mass.  381 ;  ante,  §  187.  ^  17  Minu.  497. 

3  98  Mass.  381.  *  And  see  post,  §  211. 

408 


CH.  X.]  OF   CONCEALMENT.  [§  207 

him.^  It  can  scarcely  be  necessary  to  add,  to  secure  practi- 
cal impunity  to  the  insurer,  the  further  stipulation,  that  "  if, 
after  insurance,  the  risk  shall  be  increased  by  any  means 
whatever,  and  the  insured  shall  neglect  to  notify  the  com- 
pany of  such  increase,  such  insurance  shall  be  void."^ 

§  207.  Facts  kno'wn  to  Insurer,  or  -which  lessen  the  Risk ; 
Minor  Details.  —  A  failure  to  state  facts  known  to  the  in- 
surer,^ or  his  agent,*  or  which  he  ought  to  know,^  since  these 
he  will  be  presumed  to  know,  or  which  lessen  the  risk,  for 
that  only  is  material  which  tends  to  increase  the  risk,^  in 
the  absence  of  express  stipulation,  and  where  no  inquiry  is 
made,  is  no  concealment.  [When  no  inquiries  are  made, 
the  intention  of  the  assured  becomes  material,  and  to  avoid 

1  Hardy  v.  Union  Mut.  Fire  Ins.  Co.,  4  Allen  (Mass.),  217  ;  Chaffee  v.  Catta- 
raugus County  Mut.  Ins.  Co.,  18  N.  Y.  376  ;  Kennedy  v.  St.  Lawrence  County 
Mut.  Ins.  Co.,  10  Barb.  (N.  Y.)  285  ;  Abbott  v.  Shawmut  Mut.  Fire  Ins.  Co.,  3 
Allen  (Mass.),  214  ;  Shawmut  Mut.  Fire  Ins.  Co.  v.  Stevens,  9  id.  332  ;  Colum- 
bia Ins.  Co.  V.  Cooper,  50  Pa.  St.  331.  See  also  Teutonia  Life  Ins.  Co.  v.  Beck, 
74  111.  165  ;  Beck  v.  Hibernia  Ins.  Co.,  44  Md.  95  ;  McDonald  v.  Law  Union  Fire 
&  Life  Ins.  Co.,  L.  R.  9  Q.  B.  328  ;  s.  c.  3  Ins.  L.  J.  796  ;  Baker  v.  Home  Life 
Ins.  Co.,  2  Hun  (N.  Y.),  402  ;  s.  c.  affirmed,  64  X.  Y.  648  ;  Barteau  v.  Phcenix 
Mut.  Ins.  Co.,  67  id.  595  ;  Jeffries  v.  Economical  Life  Ins.  Co.,  22  Wall.  (U.  S.)  47. 
We  remember  to  have  heard  a  learned  judge,  who  was  giving  a  reluctant  judg- 
ment in  one  of  these  cases  against  the  insured,  observe,  with  considerable  feel- 
ing, that  if  such  companies  would  provide  simply  that  they  should  never,  in  any 
event,  be  liable  in  case  of  loss,  they  would  not  only  save  the  courts  from  much 
disagreeable  duty,  but  would  be  free  from  the  suspicion  of  having  purposely 
entrapped  the  insured.     See  also  ante,  §  180  a. 

2  Pottsville  Mut.  Fire  Ins.  Co.  v.  Horan  (Pa.),  9  Ins.  L.  J.  201. 

3  [If  a  company  elects  to  issue  a  policy  after  becoming  aware  of  a  disaster  to 
the  property,  though  known  by  the  jjlciintiff  and  concealed  at  tlie  time  of  application, 
the  plaintiff  may  recover.  Royal  Can.  Ins.  Co.  v.  Smith,  5  Russ.  &.  Geld.  (Nova 
Sco.)  322,  Weatherbee,  J.,  dis.  Knowledge  of  the  insurer  equal  to  that  of  the 
insured,  makes  disclosure  unnecessary.  Where,  however,  the  assured's  knowl- 
edge is  particular  and  definite,  while  that  of  the  insurer  is  only  general,  dis- 
closure must  be  made.  For  example,  knowledge  of  a  particular  gale  where  the 
assured's  ship  was  must  be  given  to  the  insurers  before  the  issuing  of  the  policy, 
although  they  already  know  that  there  have  just  been  severe  gales  in  that  region. 
Moses  V.  Delaware  Ins.  Co.,  1  Wash.  385,  388.] 

*  [The  applicant  is  not  bound  to  disclose  what  the  agent  knows.  Richards  v. 
Wash.  Fire  &  Mar.  Ins.  Co.,  60  Mich.  420.] 

6  [When  the  insurer  has  the  means  of  knowledge  at  hand,  and  both  parties 
are  aware  that  such  is  the  case,  it  is  probable  that  he  cannot  set  up  the  failure  to 
disclose  such  fact  as  a  defence.     Bates  v.  Hewitt,  4  F.  &  F.  1023,  1031.] 

8  [When  the  matter  concealed  could  have  in  no  way  increased  the  risk,  the 
concealment  is  immaterial.     Lexington  Ins.  Co.  v.  Paver,  16  Ohio,  324,  334.] 

409 


§  207]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,    ETC.  [CH.  X. 

the  policy  it  must  be  found  not  only  that  the  matter  was 
material,  but  also  that  it  was  intentionally  and  fraudulently 
concealed.^  But  a  concealment  in  respect  to  a  matter  speci- 
fically inquired  about  in  the  application  is  fatal,  although 
the  question  is  not  really  material.^]  The  insurers  are  pre- 
sumed to  be  skilled  in  their  business,  and  to  know  those 
general  facts,  political  and  otherwise,  which  are  open  to  the 
public,  and  may  be  known  to  all  who  are  interested  to  in- 
quire.^ [If  according  to  usage  certain  papers  would  be  on 
shipboard,  non-disclosure  of  those  papers  will  not  affect  the 
plaintiff.'']  In  like  manner  the  insured  is  presumed  to  know 
what  a  man  of  ordinary  capacity  ought  to  know,  and  a  fail- 
ure to  state  such  facts  as  are  clearly  material  in  the  general 
judgment  will  amount  to  a  concealment.^  Such  details, 
however,  as  the  character  and  pursuits  of  the  tenants  or 
occupants  of  a  building;^  or  the  character  of  the  buildings 
adjoining;^  or  that  the  insured  had  commenced  the  erection 
of  a  new  building  near  those  insured ;  ^  or  that  he  is  person- 
ally obnoxious  to  the  neighborhood  in  which  he  lives  ;^  or 
the  fact  of  pending  litigation  relative  to  the  premises ;  ^^  or 
how  a  building  is  heated  or  lighted,  unless  in  the  mode  of 
heatino:  or  lishtins;  there  is  something  unusual  ;^^  or  that 


1  [Alkan  v.  N.  H.  Ins.  Co.,  53  Wis.  136,  142.] 

2  [Fame  Ins.  Co.  v.  Thomas,  10  Brad.  545.] 

3  Carter  v.  Boehm,  1  W.  Black.  593  ;  Boggs  v.  Amer.  Ins.  Co.,  30  Mo.  63  ; 
Merch.  &  Mar.  Mut.  Ins.  Co.  v.  Washington  Mut.  Ins.  Co.,  1  Hand.  (Ohio)  408  ; 
Haley  v.  Dorchester  Mut.  Fire  Ins.  Co.,  12  Gray  (Mass.),  545;  Pimm  v.  Lewis, 
2  F.  &  F.  778  :  Foley  r.  Tabor,  id.  663  ;  Benson  v.  Ottawa  Agr.  Ins.  Co.,  42 
U.  C.  (Q.  B.)  282. 

*  [Livingston  v.  Maryland  Ins.  Co.,  7  Cranch,  506.] 

5  Dennison  v.  Thomaston  Mut.  Ins.  Co.,  20  Me.  125.  [If  occupancy  of  the 
insured  house  by  two  tenants  instead  of  one  was  material  to  the  risk,  it  should 
be  disclosed,  otherwise  it  need  not  be,  and  it  is  a  question  of  fact  for  the  jury. 
Hardman  v.  Fireman's  Ins.  Co.,  20  Fed.  Rep.  594,  595.] 

6  Lyon  V.  Commercial  Ins.  Co.,  2  Rob.  (La.)  266. 

'  Satterthwaite  i-.  Mut.  Ben.  las.  Co.,  14  Pa.  St.  393. 

8  Gates  V.  Madison  County  Mut.  Ins.  Co.,  1  Seld.  (N.  Y.)  469. 

9  Keith  V.  Globe  Ins.  Co.,  52  111.  518. 

M  Hill  V.  Lafayette  Ins.  Co.,  2  Mich.  476  ;  Cheek  v.  Col.  Fire  Ins.  Co.  (Tenn.), 
4  Ins.  L.  J.  99. 

"  Girard  Fire  &  Mar.  Ins.  Co.  v.  Stephenson,  37  Pa.  St.  293  ;  Clark  v.  Manu. 
facturing  Ins.  Co.,  8  How.  (U.  S.)  235. 
410 


CH.  X.]  OF   CONCEALMENT.  [§  207 

there  is  other  insurance,^  —  need  not  be  disclosed  unless 
inquired  for.  And  even  if  the  inquiry  be  whether  others 
are  interested  in  the  property,  a  void  tax-title  need  not  be 
disclosed. 2  [Where  carpenter  work  was  going  on  in  the 
insured  building  but  no  questions  or  answers  were  given  as 
to  it,  nor  was  fraud  or  intentional  concealment  proved,  the 
concealment  was  left  to  the  jury,  and  the  court  refused  to 
overrule  their  decision.^]  Although  it  was  said  in  an  early 
case  that  marine,  fire,  and  life  insurance  stand  upon  the 
same  footing  as  to  the  application  of  the  doctrine  of  con- 
cealment,* there  is  reason  for  less  strictness  in  cases  of  fire 
insurance,  where  the  insurers  are  by  no  means  so  dependent 
upon  the  insured  for  their  information,  and  may,  and  often 
in  fact  generally  do,  by  themselves  or  their  agents,  make 
personal  examination.  Even  in  marine  insurance,  a  failure 
to  disclose  the  fact  that  there  were  damaged  goods  on  board 
the  vessel,  which  from  their  damaged  condition  might  tend 
to  increase  the  risk,  was  held  to  be  no  concealment.^  Be- 
sides, the  propounding  of  a  series  of  questions  as  to  partic- 
ular facts  gives  rise  to  the  inference  that  others  are  not 
regarded  as  material,  or  that  upon  them  the  insurer  has 
informed  himself.  Hence  a  failure  to  disclose  many  minor 
details  obvious  to  any  one  who  examines,  and  open  to  gen- 
eral observation,  is  not  to  be  regarded  as  a  concealment.^ 
The  mere  omission,  without  fraud,  to  state  matter  not  called 
for  by  specific  or  general  inquiry,  is  not  concealment." 

1  Parsons  v.  Citizens'  Ins.  Co.,  43  U.  C.  (Q.  B.)  261  ;  :\IcDonell  i;.  Beacon  Fire 
&  Life  Ins.  Co.,  U.  C.  7  C.  P.  308.  [Non-disclosure  of  prior  assurance  is  not 
fatal  unless  the  contract  calls  for  such  disclosure.  Agricultural  Ins.  Co.  v.. 
Bemiller,  70  Md.   400.] 

2  Cheek  v.  Columbia  Fire  Ins.  Co.  (Tenn.),  4  Ins.  L.  J.  99. 

3  [People  1-.  Liv.,  Lon.,  &  Globe  Ins.  Co.,  2  T.  &  C.  (N.  Y.)  268,  271.] 
*  Lindeneau  v.  Desborougli,  8  B.  &  C.  586. 

5  Boyd  V.  Dubois,  3  Camp.  (Nisi  Prius)  133. 

6  Burritt  v.  Saratoga  County  Mut.  Fire  Ins.  Co.,  5  Hill  (N.  Y.),  188  ;  Holmes 
V.  Charlestown  ilut.  Fire  Ins.  Co.,  10  Met.  (Mass.)  211  ;  Jolly's  Adm'r  v.  Bait. 
Eq.  Soc,  2  H.  &  G.  (Md.)  295  ;  Gates  v.  Madison  County  Mut.  Ins.  Co.,  1  Seld. 
(N.  Y. )  469  ;  Cheever  v.  Union  Central  Ins.  Co.,  Supr.  Ct.  Cincinnati ;  5  Big.  Life 
&  Ace.  Ins.  Cas.  458. 

■  Rawls  V.  American  Mut.  Life  Ins.  Co.,  27  N.  Y.  282  ;  Swift  v.  Mass.  :Mut. 
Life  Ins.  Co.,  63  N.  Y.  186  ;  Laidlaw  i-.  Liverpool,  &c.  Ins.  Co.,  13  Grant's  Ch. 
(U.  C.)  377. 

411 


§208]  INSURANCE:    FIRE,   LIFE,    ACCIDENT,   ETC.  [CH.  X. 

§  208.  What  Facts  must  be  disclosed  ;  Threats  of  Burning. 
—  Such  facts,  however,  as  are  unusual,  threatening,  and  not 
open  to  general  observation,  especially  if  they  are  the  in- 
ducement or  occasion  for  the  application  for  insurance,  ought 
to  be  disclosed,  whether  inquired  about  or  not.  The  fact 
that  frequent  threats  or  attempts  have  been  made  to  set  fire 
to  the  property  for  insurance  upon  which  application  is 
made,  is  such  an  one  as  would  naturally  attract  the  atten- 
tion of  the  insurers,  if  known,  and  modify  their  estimate  of 
the  risk.  Withholding  such  facts,  if  inquired  about,  would 
therefore  amount  to  a  concealment  which  would  vitiate  the 
policy.  1  And  the  same  would  be  true  if  the  inducement 
which  leads  to  the  procurement  of  insurance  is  the  fact  that 
attempts  have  been  made  to  set  fire  to  neighboring  property 
so  situated  that,  if  it  should  burn,  the  property  upon  which 
insurance  is  sought  would  be  endangered.^  [But  a  failure 
to  disclose  a  threat  of  burning  made  during  an  election  ex- 
citement several  months  before  the  insurance,  is  not  mate- 
rial.^] A  neglect  to  disclose  such  facts,  after  insurance  has 
been  obtained,  is  not  such  a  failure  to  make  known  any 
change  of  circumstances  increasing  the  risk  under  a  by-law 
providing  that  notice  of  such  change  of  circumstances  must 

1  Curry  v.  Commonwealth  Ins.  Co.,  10  Pick.  (Mass.)  535  ;  Bebee  v.  Hartford 
Mut.  Ins.  Co.,  25  Conn.  51  ;  New  York  Bowery  Ins.  Co.  v.  New  York  Ins.  Co., 
17  Wend.  (N.  Y.)  359  ;  North  American  Fire  Ins.  Co.  v.  Throop,  22  Mich.  146  ; 
Greet  v.  Royal  Ins.  Co.,  16  C.  L.  J.  275.  The  plaintiff  answered  "no"  to  the 
question,  "  Is  there  any  reason  to  fear  incendiarism,  or  has  any  threat  been 
made  ? "  The  policy  was  to  be  void  if  insured  omitted  to  state  "  any  circum- 
stance material."  The  insured  had  been  threatened  a  beating,  and  for  this  rea- 
son got  insured,  and  the  policy  was  held  to  be  void.  Campbell  v.  Victoria  Mut. 
Ins.  Co.,  U.  C.  (Q.  B.)  17  Can.  L.  J.  40  (1881),  Arman,  J.,  dissenting.  [The 
question  "  Is  there  reason  to  fear  incendiarism,  or  has  any  threat  been  made  ?" 
has  been  held  equivalent  to,  "  Have  you  reason  to  fear,  or  do  you  fear  incendi- 
arism ?"  and  if  the  applicant  really  feared  it  though  without  valid  reason,  a  non- 
disclosure is  fatal.  Campbell  v.  Vict.  Mut.  Fire  Ins.  Co.,  45  U.  C.  R.  412, 
Armour,  J.,  dis.  If  the  insured  answers  all  questions  put  to  him  in  the  blank 
application,  he  is  not  bound  to  state  therein  a  threat  "to  fix  him  "  which  induces 
him  to  insure.  He  informed  the  agent  of  it,  and  this  was  held  entirely  sufHcient. 
Smith  V.  Home  Ins.  Co.,  47  Hun,  30.] 

2  Walden  i;.  Louisiana  Ins.  Co.,  12  La.  134  ;  Bufe  v.  Turner,  6  Taunt.  338  ; 
Uzielli  V.  Commercial,  &c,  Ins.  Co.,  12  L.  Times  n.  s.  399.  See  also  post, 
§215. 

3  [Kelly  V.  Hochelaga  Mut.  Fire  Ins.  Co.,  24  L.  C.  Jur.  298.] 

412 


CH.  X.]  OF   CONCEALMENT.  [§  209 

be  made  under  penalty  of  avoiding  the  policy  if  it  be  not 
done.i  [Where  the  by-laws  of  a  company  are  expressly 
made  a  part  of  the  policy,  and  they  provide  that  any  fact 
subsequent  to  the  application  which  would  have  to  have  been 
stated  therein,  must  be  stated  to  the  company,  the  assured 
is  bound  to  the  same  strictness  as  to  such  facts  as  he  was 
in  relation  to  the  original  ones.^] 

§  209.  General  Statement  sufficient,  if  such  as  Good  Faith 
and  Pair  Dealing  require.  —  A  general  statement  of  the  facts, 
however,  sufficient  to  put  the  insurers  upon  inquiry  if  they 
desire  more  particular  information,  is  all  that  is  necessary.^ 
But  if  inquiry  be  made  on  this  point,  as  the  matter  is  within 
the  especial  knowledge  of  the  applicant,  the  answer  should 
be  full,  and  in  itself  contain  the  information  which  would 
naturally  lead  to  further  investigation.  If,  therefore,  in 
response  to  a  specific  inquiry,  the  applicant  declares  that  he 
has  no  reason  to  believe  his  property  in  danger  from  incen- 
diarism, and  it  appears  that  in  fact  he  had,  it  will  be  no 
reply  that  he  had  previously  talked  with  the  agent  of  the 
company  about  several  recent  attempts  made  to  burn  build- 
ings in  town,  and  the  risk  of  such  fires  generally,  without 
mentioning  a  supposed  attempt  upon  the  building  upon  which 
the  application  for  insurance  was  made.  Whether  such  talk 
might,  or  might  not,  have  put  him  on  inquiry  is  immaterial. 
The  truth  of  the  answer  is  the  only  question  open  to  the 
jury.*    It  was  held,  however,  in  McBride  v.  Republic  Fire 

1  Clark  V.  Hamilton  Mut.  Ins.  Co.,  9  Gray  (Mass.),  148. 

2  [Calvert  v.  Hamilton  Mut.  Ins.  Co.,  1  Allen,  308,  310.] 
8  Bebee  v.  Hartford  Mut.  Ins.  Co.,  25  Conn.  51. 

*  "When  a  person  is  particularly  interrogated,"  said  the  court,  in  North 
American  Fire  Insurance  Company  v.  Throop,  22  Mich.  146,  and  see  post,  §  212, 
"  regarding  a  subject  peculiarly  within  his  own  knowledge,  and  the  other  party 
is  expected  to  contract  with  him  in  reliance  upon  his  answer,  and  the  answer  ia 
made  misleading,  if  not  untruthful,  it  seems  to  us  alike  a  perversion  of  law  and 
justice  to  say  that  he  shall  have  the  advantage  of  his  uncandid  answers  if  he  can 
convince  the  jury  that  the  other  party  was  wanting  in  prudence,  in  relying  upon 
them,  because  of  having  extrinsic  notice,  which  was  sufficient,  if  followed  up  by 
inquiries  in  other  quarters,  to  have  led  him  to  a  knowledge  of  the  exact  facts. 
The  insurer  has  a  right  to  know  the  truth  from  the  assured  himself  ;  and  if  his 
inquiries  addressed  to  him  failed  to  elicit  the  truth,  it  is  no  excuse  to  the  latter, 
either  in  morals  or  law,  that  the  insurer,  if  sufficiently  distrustful  and  suspicious, 

413 


§  210]  INSUEANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  X. 

Insurance  Company, ^  where  there  were  specific  threats 
against  the  particular  property  insured,  and  an  answer  to 
an  inquiry  upon  this  point  was  in  the  negative,  that  such 
an  answer  would  not  avoid  the  policy,  unless  the  threats 
made  were  of  such  a  character  and  from  such  a  person  that 
danger  was  reasonably  to  be  apprehended,  and  such  that  a 
person  of  ordinary  prudence  and  caution  would  regard  them 
as  worthy  of  notice.  But  mere  idle  talk,  which  by  a  pru- 
dent person  might,  and  probably  would,  be  disregarded,  need 
not  be  communicated. 

§210.  Equivocal  Interrogatories;  Opinions. — Of  COUrse,  if 
the  inquiry  be  equivocal,  or  calls  for  an  answer  which  in- 
volves an  expression  of  opinion,  as  when  the  question  is  as 
to  the  distance  of  buildings  within  ten  rods;^  or  what  build- 
ings endanger  the  one  insured ;  ^  or  if  there  is  a  livery-stable 
in  the  vicinity,*  —  whether  the  first  question  involves  the 
necessity  of  specifying  all  the  buildings  within  that  dis- 
tance, or  only  the  nearest  ones,  or  what  buildings  "endan- 
ger," or  what  constitutes  "vicinity,"  are  questions  to  some 
extent  of  opinion  upon  which  intelligent  men  may  differ, 
and  therefore  it  is  enough  to  answer  them  as  men  of  ordi- 
nary intelligence  should.  So  if  the  inquiry  be  as  to  whether 
the  applicant  has  suffered  from  any  derangement  of  certain 
functions,  or  had  any  "serious  illness"  or  disease  "tending 
to  shorten  life,"  or  any  other  inquiry  which  may  be  under- 
stood in  different  senses,  as  the  answer  to  these  questions 

and  inclined  to  rely  upon  what  he  had  heard  from  others  rather  than  upon  the  word 
of  the  assured  himself,  could  be  regarded  as  '  put  on  inquiry,'  respecting  the  truth- 
fulness and  candor  of  the  information,  in  consequence  of  something  he  had  heard 
incidentally  at  a  time  when  perhaps  he  had  no  special  occasion  to  charge  his 
memory  with  it.  He  goes  to  the  authority  that  ought  to  be  the  best,  and  he  has 
a  right  to  rely  upon  what  is  told  him.  If  it  were  allowable  to  submit  to  a  jury 
the  question  of  his  pn;dence  in  doing  so,  it  would  be  impossible  for  them,  in 
most  cases,  to  be  so  fully  possessed  of  the  exact  condition  of  his  information  at 
the  time  as  to  be  enabled  to  determine  whether  he  was  or  was  not  guilty  of  negli- 
gence in  such  reliance." 

1  30  Wis.  562. 

2  Gates  V.  Madison  County  Mut.  Ins.  Co.,  2  Comst.  (N.  Y.)  43  ;  s.  c.  1  Seld. 
(N.  Y.)  469;  reversing  same  case  in  3  Barb.  (N.  Y.)  73;  Masters  v.  Madison 
County  Mut.  Ins.  Co.,  11  id.  624. 

3  Dennison  v.  Thomaston  Mut.  Fire  Ins.  Co.,  20  Me.  125. 

*  Haley  v.  Dorchester  Mut.  Fire  Co.,  12  Gray  (Mass.),  545. 

414 


CH.  X.]  OF   CONCEALMENT.  [§  211 

may  be  mere  matter  of  opinion,  an  honest  though  erroneous 
answer  is  no  misrepresentation.^  Opinions,  if  honestly- 
entertained  and  honestly  communicated,  are  not  misrepre- 
sentations, however  erroneous  they  may  prove  to  be.^ 

§  211.  Same  Subject.  — Upon  this  point  the  Maine  case 
just  cited  is  so  full  of  sound  practical  sense,  that  it  cannot 
be  too  often  cited  or  too  often  perused.  The  only  facts  neces- 
sary to  be  added  to  those  stated  in  the  opinion  of  the  court 
are,  that  to  the  questions,  "  What  are  the  buildings  occupied 
for  that  stand  within  four  rods  ?  how  many  buildings  are 
there  to  the  fires  of  which  this  may  be  in  any  case  exposed  ?  " 
there  was  no  answer,  and  that  the  policy  was  to  be  void  if  any 
circumstance  material  to  the  risk  was  suppressed. ^ 

1  Hogle  V.  Guardian  Life  Ins.  Co.,  6  Roht.  (N.  Y.  Superior  Ct.)  567  ;  Higbie 
V.  Guardian  Life  Ins.  Co.,  53  N.  Y.  603 ;  Jones  v.  Prov.  Ins.  Co.,  3  C.  B.  N.  s.  65. 
See  also  ante,  §§  175,  202  ;  Moulor  v.  Am.  Life  Ins.  Co.,  101  U.  S.  708;  Fitch  v. 
Am.  Popular  Life  Ins.  Co.,  59  N.  Y.  557. 

2  Dennisou  v.  Thomaston  Mut.  Ins.  Co.,  20  Me.  125.  See  also  Hill  v.  Lafay- 
ette Ins.  Co.,  2  Mich.  476  ;  ante,  §§  178,  187,  202.  If  the  applicant  answers,  as 
to  what  he  must  have  known  and  understood,  contrary  to  that  knowledge  and 
understanding,  there  can  be  no  doubt  that  the  law  is  as  stated  in  §  201.  Baiteau 
V.  PlifBuix  Life  Ins.  Co.,  67  N.  Y.  595  ;  affirming  s.  C.  1  Hun  (N.  Y.),  430. 

3  Whitman,  C.  J.,  in  giving  the  opinion,  said  :  "The  misrepresentation  alleged 
is  contained  in  the  answer  to  a  written  interrogatory,  propounded  to  the  plain titf, 
as  to  the  distance  of  other  buildings  from  the  premises  insured.  The  answer  was 
in  these  words  :  '  East  side  of  the  block  are  small  one-story  wood-sheds,  and  would 
not  endanger  the  buildings  if  they  should  burn.'  In  evidence  it  appeared  that 
small  sheds  projected  out  from  near  the  back  part  of  the  brick  block  of  buildings 
(one  of  which  was  the  house  in  question)  twenty-four  feet,  being  twelve  feet  in 
width,  and  eight  feet  stud ;  and  leaving  a  passage-way  in  the  rear  of  them  of 
fourteen  feet  wide,  adjoining  some  two-story  wooden  buildings  standing  on  another 
street  forty-nine  feet  from  the  plaintiff's  house,  and  in  which  the  fire  which 
consumed  the  plaintiff's  house  originated.  The  first  question  which  arises 
is.  Was  this  a  misrepresentation,  or  was  there  a  suppression  of  the  truth  tan- 
tamount thereto,  and  material  to  the  risk  ?  It  does  not  seem  to  be  necessary 
in  order  to  avail  the  defendants  in  their  defence,  that  the  misrepresentation  or 
suppression  of  the  truth  should  have  been  wilful.  If  it  were  but  an  inadvertent 
omission,  yet  if  it  were  material  to  the  risk,  and  such  as  the  plaintiff  should  have 
known  to  be  so,  it  would  render  the  policy  void.  In  the  case  at  bar  it  has  now 
been  rendered  undeniable  that  the  burning  of  the  two-story  buildings  on  another 
street  endangered  the  plaintiff's  house  ;  and  to  the  interrogatory  propounded  it 
now  would  seem  that  the  existence  of  those  buildings  might,  with  propriety,  have 
been  stated.  But  this  does  not  prove  that  before  the  occurrence  of  the  fire  it 
would  have  been  deemed  material  to  name  them,  as  being  near  enough  to  put  the 
plaintiffs  house  in  jeopardy.  It  is  not  an  unfrequent  occurrence,  after  a  disaster 
has  happened,  that  we  can  clearly  discern  that  the  cause  which  may  have  pro- 

415 


§  212]         insurance:  fire,  life,  accident,  etc.  [ch.  X. 

§  212.  Equivocal  Answer.  —  An  equivocal  answer,  how- 
ever, to  a  question,  though  true  in  one  sense,  may  involve 
a  misrepresentation  or  concealment,  all  the  facts  being 
known  to  the  applicant;  as  if  the  insured  should  say  he 
had  been  sick  a  week  when  he  had  been  sick  two  weeks,  or 
had  had  a  medical  attendant  once  within  a  certain  period 
when  in  fact  he  had  had  one  on  several  occasions  within 
that  time,  or  that  he  was  thirty  years  old  when  in  fact  he 

duced  it  would  be  likely  to  have  such  an  effect  ;  while,  if  no  such  disaster  had 
occurred,  we  might  have  been  very  far  from  expecting  it.  In  this  case  it  is  es- 
sential to  determine  whether  the  plaintiff  was  bound  to  have  known  that  a  fire, 
orii^iiiating  in  the  two-story  wooden  buildings  would  have  endangered  the  burning 
of  his  house.  If,  as  a  man  of  ordinary  capacity,  he  ought  to  have  had  such  an 
apprehension,  then  he  ought  to  have  named  those  buildings  in  reply  to  the  inter- 
rogatory propounded ;  for  what  a  man  ought  to  have  known,  he  must  be  presumed 
to  have  known.  His  knowledge  in  a  case  like  the  present  must  have  been  some- 
thing more  than  that,  by  a  possibility,  a  fire  so  originating  might  have  endangered 
his  house.  This  kind  of  knowledge  might  exist  in  regard  to  a  fire  originating  in 
almost  any  part  of  a  city  like  Bangor  ;  for  a  fire  originating  in  an  extreme  part 
of  it,  if  the  wind  were  high  and  favorable  for  the  purpose,  might  endanger  all  the 
buildings,  however  remote,  standing  nearly  contiguous  one  to  another  to  the  lee- 
ward of  it.  Any  danger  like  this  could  not  have  been  in  contemplation  when  the  in- 
terrogatory was  propounded.  Such  buildings  only  as  were  so  nearly  contiguous  as 
to  have  been,  in  case  a  fire  should  originate  therein,  productive  of  imminent  hazard 
to  the  safety  of  the  plaintiff's  dwelling  could  have  been  in  view  by  the  defendants. 
And  the  question  is,  Were  the  two-story  wooden  buildings  of  that  description  ? 

"  In  reference  to  this  question,  it  may  not  be  unimportant  to  consider  that  the 
defendants,  at  the  time  when  this  policy  was  effected,  had  an  agent  residing  in 
Bangor,  whose  business  it  was  to  attend  in  their  behalf  to  the  applications  for  in- 
surance in  that  quarter.  It  may  be  believed  that  the  selection  of  this  individual 
was  the  result  of  knowledge  with  regard  to  his  intelligence  and  capacity  for  such 
purpose.  It  was  not,  however,  his  business  perhaps  to  prepare  representations  to 
be  made  by  applicants  for  insurance'.  But  it  did  so  happen  that  he  assisted  the 
plaintiff  in  preparing  the  answers  to  the  standing  interrogatories  before  named, 
intended  to  produce  a  representation  upon  which  to  found  the  estimates  of  the 
propriety  of  assuming  the  risks  proposed.  He,  it  seems,  examined  the  premises, 
looked  at  the  wood-sheds,  and  the  two-story  wooden  buildings  beyond  them.  To 
him  it  did  not  seem  to  have  occurred  that  the  vicinity  of  those  buildings  was  such 
as  to  render  it  necessary  that  the  two-story  wooden  buildings  should  be  named  in 
answer  to  the  interrogatory  ;  for  he,  at  the  request  of  the  plaintiff,  penned  the 
Te\)\j  thereto  as  he  thought  proper. 

"  It  does  not  appear  that  any  witness  has  testified  that,  anterior  to  the  disaster, 
he  should  have  anticipated  such  an  event  as  within  the  range  of  probability. 
What  other  individuals  of  intelligence  did  not  foresee  to  be  likely  to  occur,  could 
not  reasonably  be  expected  of  the  plaintiff.  And  what  he  could  not  be  expected 
to  know,  he  cannot  be  considered  as  culpable  for  not  knowing.  And  what  he 
could  not  be  expected  to  apprehend,  he  could  not  be  bound  to  communicate  ;  and 
in  not  communicating  any  such  fact,  he  could  not  be  considered  as  guilty  of  con- 
cealing it,  even  inadvertently,  and  much  less  wilfully." 

416 


CH.  X.]  OF   CONCEALMENT.  [§212 

was  fifty.  ^  And  Lord  Chief  Justice  Cockburn  thought  that 
when  the  insured  was  asked  as  to  his  occupation  or  profes- 
sion, and  answered  that  he  was  an  "esquire,"  which  in  fact 
he  was,  but  was  also  an  ironmonger,  he  should  have  stated 
the  latter  fact.  But  the  rest  of  the  court  did  not  agree  with 
him. 2  So  if  at  the  time  of  insurance  objection  is  made  to 
the  proximity  of  a  gambling  establishment,  the  fact  that  the 
premises  upon  which  insurance  is  applied  for  is  occupied  in 
part  by  gamblers,  is  one  which  might  be  material. ^  An 
equivocal  or  evasive  answer,  where  all  the  facts  are  known 
to  the  applicant,  so  that  he  can  answer  unequivocally,  is 
just  as  fatal  as  a  false  one.  If  not  untrue,  it  is  practically 
a  concealment.  As  when  one  has  had,  and  knows  he  has 
had,  certain  symptoms  of  disease  inquired  about,  and  he 
answers,  "See  surgeon's  report;"*  or  is  inquired  of  as  to 
the  number  of  times  he  has  required  medical  attendance, 
and  answers,  "Two  years  ago,"  when  in  fact  he  had  re- 
quired it  at  other  times  ;^  or  as  to  his  age,  and  gives  a  less 
number  of  years  than  the  true  number;^  or  as  to  his  occupa- 
tion, and  having  two,  he  states  the  one  most  favorable  to 
himself,'  though  on  this  point  of  occupation  the  Court  of 
Exchequer  Chamber  seem  to  have  sanctioned  the  most  ob- 
vious equivocation.^  So  if  the  insured  equivocates  as  to  his 
medical  attendant;  or  if,  having  had  more  than  one,  gives 
the  name  of  that  one  who  he  has  reason  to  believe  is  least 
able  to  give  the  information  sought  by  the  insurers ;  ^  or  if 

1  Cazenove  v.  Brit.  Eq.  Ass.  Co.,  6  C.  B.  N.  s.  437  ;  s.  c.  on  appeal,  29  L.  J. 
(C.  P.)  160. 

2  Perrins  v.  Mar.  &  Gen.  Trav.  Ins.  Co.,  2  E.  &  E.  317;  post,  §  306. 

3  Lyon  V.  Com.  Ins.  Co.,  2  Rob.  (La.)  266. 

4  Smith  V.  Mtna  Life  Ins.  Co.,  49  N.  Y.  211. 

5  Cazenove  v.  Brit.  Eq.  Ass.  Co.,  6  C.  B.  N.  s.  437. 

6  Ibid.,  per  Pollock,  C.  B.  Murphy  v.  Harris,  Batty  (Irish),  206 ;  Wray  v. 
Man.  Prov.  Ass.  Co.,  cited  by  Bliss,  Ins.  165  ;  post,  §  305. 

■^  Hartman  v.  Keystone  Ins.  Co.,  21  Pa.  St.  466. 

8  Cazenove  v.  Brit.  Eq.  Ass.  Co.,  6  C.  B.  X.  s.  437 ;  ante,  §  212 ;  post,  §  306. 

9  Morrison  v.  Muspratt,  4  Bing.  60  ;  Hutton  v.  Waterloo  Life  Ass.  Soc,  1  F. 
&  F.  735  ;  Monk  v.  Union  Mut.  Life  Ins.  Co.,  6  Robt.  (N.  Y.  Superior  Ct.)  455 ; 
Huckman  v.  Fernie,  3  Mees.  &  Wels.  505.  And  see  also  Forbes  v.  Ed.  Life  Ass. 
Co.,  10  Ct.  of  Sess.  Cas.  (Scotch)  451  ;  Abbott  v.  Howard,  Hayes  (Irish),  381  ; 
Maynard  v.  Rhode,  1  C.  &.  P.  360 ;  North  Am.  Fire  Ins.  Co.  v.  Throop,  22  Mich. 
146  ;  ante,  §  209;  post,  §  304. 

VOL.  I. —27  417 


§  213]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,    ETC.  [CH.  X. 

he  equivocates  in  his  answer  to  the  inquiry  whether  he  has 
applied  elsewhere  lor  insurance  and  been  refused.  ^  If  the 
answer  be  rather  irresponsive  than  equivocal,  as  when  in 
answer  to  the  question  where  his  usual  medical  attendant 
resided,  he  says,  "Refer  to  Dr.  A.  of  B.,"  it  seems  that  the 
insurers  should  inquire  further,  or  be  considered  as  having 
waived  inquiry.^ 

§  213.  Agent's  Concealment  imputable  to  Principal.  —  Con- 
cealment or  misrepresentation  by  an  agent  authorized  to 
effect  the  insurance  is  of  course  concealment  or  misrepre- 
sentation by  the  principal,  and  carries  with  it  the  same 
consequences.^  An  innocent  principal  cannot  take  any  bene- 
fit from  the  fraud  of  his  agent. ^  The  important  question  is 
whether  the  agent  is  of  such  a  character.  In  effecting  in- 
surance upon  the  lives  of  third  persons,  reference  is  often 
made  to  the  person  whose  life  is  to  be  insured,  or  to  some 
other  person  for  information,  and  the  doctrine  that  such  per- 
sons so  referred  to  are  to  be  considered  as  the  agents  of  the 
insured  in  giving  answers  to  all  material  questions  which 
may  be  put  to  them  respecting  the  matters  as  to  which  they 
may  be  properly  interrogated,  has  apparently  received  the 
sanction  of  some  learned  judges.^  But  in  a  comparatively 
recent  case,*^  Lord  Campbell  carefully  reviewed  the  several 

1  London  Ass.  Soc.  v.  Mansel,  48  L.  J.  Ch.  331. 

2  Higgins  V.  Phcenix  Mut.  Life  Ins.  Co.,  76  N.  Y.  6  ;  Edington  r.  Mut.  Life 
Ins,  Co.,  67  N.  Y.  185. 

8  [A  broker  procuring  insurance  is  the  agent  of  the  applicant,  and  a  conceal- 
ment by  him  avoids  the  policy.  Hamblet  v.  City  Ins.  Co.,  36  Fed.  Rep.  118  (Pa.), 
1888.  But  where  A.  applied  to  an  agent  B.  for  insurance,  B.  knowing  the  nature 
of  the  risk  did  not  wish  to  ymt  it  all  in  his  company,  so  he  went  to  C,  the  agent 
of  another  company,  who  without  any  communication  with  A.  or  any  knowledge 
of  the  property,  wrote  a  policy  and  gave  it  to  B.,  who  delivered  it  to  A.,  C's  com- 
pany was  held  bound.  May  v.  Western  Ass.  Co.,  27  Fed.  Rep.  260  (Minn.), 
1886.] 

*  National  Life  Ins.  Co.  v.  Minch,  53  K  Y.  144.     See  also  ante,  §§  122,  202. 

6  See  Fitzherbert  v.  Mather,  1  Term  R.  12  ;  Cornfoot  v.  Fowke,  6  Mees.  & 
Wels.  358 ;  Morrison  v.  Muspratt,  4  Bing.  60  ;  Maynard  v.  Rhodes,  5  Dowl.  & 
Ry.  266  ;  Lindeneau  v.  Desborough,  8  B.  &  C.  586  ;  Everett  t;.  Desborough,  5 
Bing.  503  ;  Huckman  r.  Fernie,  3  Mees.  &  Wels.  505 ;  Swete  v.  Fairlie,  6  C.  & 
P.  1 ;  Rawlins  v.  Desborough,  2  Moo.  &  Rob.  328,  329. 

5  Wheelton  v.  Hardisty,  in  the  Queen's  Bench,  affirmed  in  the  Exchequer 
Chamber,  8  El.  &  Bl.  232. 

418 


CH.  X.]  OF   CONCEALMENT.  [§  214 

cases  supposed  to  give  such  sanction,  showing  that  they  did 
not  necessarily  so  decide,  and  came  to  the  conclusion  that 
the  doctrine  is  unsound.  And  it  seems  now  to  be  the  set- 
tled law  of  England  that  when  the  insured  does  not  ex- 
pressly stipulate  for  the  truth  of  the  statements  of  third 
persons  thus  referred  to,  but  only  states  his  belief  in  their 
truth,  fraudulent  misrepresentation  or  concealment  by  them, 
but  not  known  to  the  insured,  will  not  avoid  the  policy. 
They  are  not  agents  in  any  such  sense  as  to  make  him  re- 
sponsible for  what  they  fraudulently  state,  or  fail  to  state.  ^ 

§  214.  Prior  or  Subsequent  Statements  of  the  Person  vyhose 
Life  is  insured  as  against  the  Party  insured.  —  Where  one  pro- 
cures insurance  upon  the  life  of  another,  the  latter  having 
signed  the  application  upon  the  truth  of  the  answers  in 
which  the  validity  of  the  policy  is  made  to  depend,  it  has 
been  held  on  the  one  hand  that  evidence  of  the  declarations 
of  the  party  upon  whose  life  the  insurance  is  effected  as  to 
the  state  of  his  health,  whether  made  before  or  after  the 
insurance  is  effected,  if  made  about  that  time,  or  so  near  as 
to  afford  a  probable  inference  as  to  the  state  of  his  health, 
is  admissible  against  the  insured.  ^  But  such  declarations 
must  have  been  made  within  such  reasonable  proximity  to 
the  time  of  effecting  the  insurance  as  to  afford  some  sub- 
stantial ground  of  inference  as  to  the  state  of  health  at  that 
time.  One  important  ground,  upon  which  such  declarations 
are  received  is,  that  they  are  a  part  of  the  res  gestce.  The 
subject  of  inquiry  is  the  health  of  the  person  whose  life  is 
insured  at  the  time  the  insurance  is  effected,  and  no  one  can 
have  so  perfect  a  knowledge  of  that  as  the  person  himself. 
Medical  men  always  arrive  at  their  conclusions  in  respect  to 
the  health  by  information  derived  in  part  from  what  their 
patients  say;  and  what  is  said  by  them  in  respect  to  health 
under  circumstances  which  preclude  any  suspicion  of  collu- 
sion is  as  fairly  a  part  of  the  res  gestce  as  are  symptoms 

1  See  also  Rawls  v.  American  Mut.  Life  Ins.  Co.,  27  N".  Y.  (13  Smith)  2S2, 
affirming  s.  c.  36  Barb.  (N.  Y. )  3.^7. 

2  Kelsey  v.  Universal  Life  Ins.  Co.,  35  Conn.  225 ;  Aveson  r.  Lord  Kinnaird, 
6  East,  188. 

419 


§  214]  INSURANCE  :    FIRE,    LIFE,   ACCIDENT,   ETC.  [CH.  X. 

learned  from  other  sources.  ^     In  both  of  the  cases  just  cited 
the  statements  were  made  prior  to  the  consummation  of  the 
contract,   and   therefore,   strictly  speaking,   what  was   said 
about  the  admissibility  of  statements  subsequent  thereto  is 
extra-judicial.     And  so  they  seem  to  have  been  regarded  by 
the  court  in  a  very  recent  case  in  Kansas, ^  where  it  was 
held  that  the  declarations  of  a  party  whose  life  was  insured 
for  another's  benefit,  made  long  after  (it  does  not  appear  by 
the  report  of  the  case  how  long)  the  contract  was  completed, 
cannot  be  received  in  evidence  against  the   insured  to  im- 
peach the  truthfulness  of  the  statements  of  the  same  party 
made  in  the  application.     The  contract,  it  was  said,  is  be- 
tween the  insured  and  the  insurer.      The  parties  are  the 
same  whether  that  which  is  insured  is  a  human  life  or  a 
building.     There  is  this  difference,  however,  that  the  life 
being  active,  can,  by  its  conduct,   affect  the  contract,  even 
so  far  as  to  annul  it,  while  the  building,  being  inanimate 
and  passive,  has  of  itself  no  such  power.     But  aside  from 
this,  the  rights  and  liabilities  of  the  parties  to  the  contract 
are  the  same.     The  party  upon  whose  life  the  insurance  is 
effected  is  not  a  party  to  the  record,  and  therefore  his  dec- 
larations are  not  admissible  on  that  ground.     He  is  not  a 
party  in  interest,  as  the  whole  benefit  inures  to  the  insured. 
Neither  is  he  the  agent  of  the  insured,  authorized  to  speak 
in  his  behalf,  nor  does  he  come  within  any  other  rule  by 
which  his  declarations  can  be  received  against  the  insured. 
And  such  was  the  doctrine  in  the  case  of  Rawls  v.  American 
Life  Insurance  Company,  with  reference  to  statements  made 
before  the  contract  was  entered  into,  the  length  of  time  prior 
to  that  event  not  being  adverted  to,^  and  the  inadmissibility 
being  placed  upon  the  ground  that  the  life-insured  was  no 
party  in  interest  to  the  contract,  and  could  therefore  make 
no  statement  or  admission,  in  the  absence  of  authority,  that 
would  devest  the  rights  of  the  plaintiff,  —  the  insured.     So, 

1  Kelsey  v.  Universal  Life  Ins.  Co.,  35  Conn.  225  ;  Aveson  v.  Lord  Kinnaird, 
6  East,  188. 

2  Washington  Life  Ins.  Co.  v.  Haney,  10  Kans.  525. 

3  36  Barb.  (N.  Y.)  357  ;  s.  c.  affirmed,  27  N.  Y.  282. 

420 


CH.  X.]  OF   CONCEALMENT.  [§  214 

also,  in  Fraternal  Mutual  Life  Insurance  Company  v.  Apple- 
gate,^  where  a  wife  had  insured  the  life  of  her  husband  for 
her  benefit,  the  declarations  of  her  husband,  made  after  the 
insurance,  as  to  the  state  of  his  health  before  that  time, 
were  held  inadmissible  for  the  purpose  of  impeaching  the 
truthfulness  of  the  statements  made  in  the  application, 
which,  in  this  respect  differing  from  the  cases  which  we 
have  just  been  considering,  was  signed  by  the  beneficiary 
thus:  "Henrietta  Applegate,  by  H.  S.  Applegate,"  the  hus- 
band. The  statements  in  question  were  regarded  by  the 
court  as  those  of  a  stranger  who  was  neither  a  party  to  the 
suit,  nor,  at  the  time  when  they  were  made,  acting  as 
the  agent  of  the  insured.  They  were  not  the  declarations 
of  a  sick  person  in  relation  to  his  condition  at  the  time  of 
making  them,  but  related  to  transactions  and  a  state  of  facts 
long  past.  They  were  not  admissions  against  interest,  for 
they  could  only  affect  injuriously  his  wife's  separate  prop- 
erty. They  were  not  the  statements  of  one  who  had  been  a 
witness  on  the  trial  offered  to  impeach  his  testimony.  And 
although  they  were  the  declarations  of  the  person  who  best 
knew  the  facts,  this  would  only  go  to  their  weight,  when 
their  competency  had  been  established.  ^ 

1  7  Ohio  St.  292. 

2  And  see  also  Stobart  v.  Diyden,  1  Mees.  &  Wels.  615,  from  which  it  is  to  be 
inferred  that  Aveson  v.  Lord  Kinnaird  is  not  an  authority  save  upon  its  exact 
facts.  In  fact,  this  case  and  the  case  of  Kelsey  v.  Universal  Life  Ins.  Co.,  ubi 
sup.,  seemed  to  have  carried  the  principles  upon  which  the)'  proceed  —  a  quasi 
right  of  cross-examination,  and  the  doctrine  that  the  declarations  are  part  of  an 
act,  and  so  part  of  the  res  gestce  —  to  an  extreme,  if  not  to  an  untenable  limit.  In- 
deed, it  must  now  be  considered  that  the  declarations  of  a  person  whose  life  is  in- 
sured for  the  benefit  of  another,  made  after  the  insurance,  and  by  the  weight  of 
authority  those  made  before,  are  inadmissible  as  against  the  beneficiary,  for  the 
purpose  of  proving  fraud,  whereby  the  policy  may  be  avoided.  Mobile  Life  Ins. 
Co.  V.  Morris  (Tenn.),  10  Ins.  L.J.  35;  Southern  Life  Ins.  Co.  r.  Booker,  9 
Heisk.  (Tenn.)  606  ;  Westropp  v.  Bruce,  Batty,  155  ;  Union  Central  Ins.  Co.  v. 
Cheever  (Ohio),  10  Ins.  L.  J.  104  ;  Grangers'  Life,  &c.  Ins.  Co.  r.  Brown  (Miss.), 
10  Ins.  L.  J.  187  ;  Cahen  v.  Continental  Life  Ins.  Co.,  69  N.  Y.  300.  Swift  v. 
Mass.  Mut.  Life  Ins.  Co.,  63  N.  Y.  186,  holds  that  declarations  of  such  a  person 
made  before  the  insurance  are  admissible.  In  that  case,  referring  to  the  cases 
from  the  6th  of  East  and  the  35th  of  Connecticut,  Folger,  J. ,  says  :  — 

"  The  soundness  of  these  decisions  has  been  called  in  question.  See  Mulliner 
V.  Guard.  Mut.  Life  Ins.  Co.,  1  N.  Y.  Supr.  Ct.  448;  Wash.  Life  Ins.  Co.  v. 
Haney,  10  Kans.  525 ;  The  Frat.  Mut.   Life  Ins.  Co.  v.  Applegate,  7  Ohio  St. 

421 


§215]         insurance:  fire,  life,  accident,  etc.         [ch.  X. 

S  215.     Special    Facts    deemed    material    to    be   disclosed.  — • 
Whether  the   fact  that   the  insured   was  in  prison  at   the 

292.  In  the  latter  case  it  is  said  that  Aveson  v.  Kinnaird,  supra,  has  not  been 
acquiesced  in,  and  that  the  contrary  doctrine  is  held  in  Stobart  v.  Dryden,  1  M. 
&  W.  615.  1  think  that  Stobart  v.  Dryden  does  not  profess  to  overrule  Aveson 
V.  Kinnaird,  or  to  establish  that  the  conclusion  there  arrived  at,  upon  the  question 
there  involved,  was  not  correct,  though  the  reasoning  indulged  in  and  the  author- 
ities cited  there  are  criticised.  Nor  have  I  been  able  to  discover  where  any  court 
has  held  that  the  declarations  of  one  whose  life  has  been  insured  for  the  beueht 
of  another,  made  as  to  his  state  of  health,  and  made  at  a  time  prior  to  and  not 
remote  from  his  examination  by  the  surgeon  of  the  insurers,  and  in  connection 
with  facts  or  acts  exhibiting  his  state  of  health,  have  been  rejected  from  the 
evidence,  where  the  issue  was  as  to  his  knowledge  of  his  own  bodily  state  at  that 
time.  There  are  decisions  that  declarations  made  after  the  contract  of  insurance 
has  been  effected  may  not  be  put  in  evidence.  But  they  are  put  upon  the  intel- 
ligent reason,  that  after  the  contract  of  insurance  has  been  efilected,  the  subject  of 
insurance  has  no  such  relation  to  the  holder  of  the  policy  as  gives  him  power  to 
destroy  or  affect  it  by  unsworn  statements.  10  Kans.  supra  ;  7  Ohio  St.  supi-a  ; 
Mullinerr.  Guard.  Life  Ins.  Co.,  snp7-a  ;  Rawlsv.  Mut.  Life  Ins.  Co.,  27  N.  Y.  282. 
And  in  some  cases  it  is  said  that  such  declarations  in  relation  to  acts  and  facts, 
made  prior  to  the  issuing  of  the  policy,  are  not  a  part  of  the  res  gestce  of  those  acts 
and  facts.  But  the  remark  did  not  grow  out  of  the  facts  of  the  case.  It  is  some- 
times asserted  that  the  case  last  cited,  and  the  same  case  in  the  court  below,  36  Barb. 
357,  do  hold  that  prior  statements  are  inadmissible.  See  Bliss  on  Life  In.s.,  §  372  ; 
1  Big.  Life  &  Ace.  Ins.  Cas.  549,  558.  But  it  does  not  appear  from  the  statements 
of  the  case  in  Barbour  and  Smith  (27  N.  Y.),  that  the  declarations  offered  were 
prior  to  the  issuing  of  the  policy  ;  and  it  does  from  the  statement  in  Smith  that 
the}'  were  subsequent,  and  so  they  are  shown  to  have  been  by  a  reference  to  the 
case  and  points  deposited  in  the  State  library.  It  is  true  that  the  opinion  of  the 
learned  judge  given  in  Barbour  condemns  the  introduction  in  evidence  of  prior  de- 
clarations. But  as  it  does  not  appear  that  any  such  were  offered,  the  remark  was 
obiter ;  and  as  it  does  not  appear  that  they  were  offered  as  having  been  made  in 
connection  with  his  prior  acts,  to  show  the  knowledge  of  the  insured  at  the  time 
of  his  medical  examination,  the  remark  is  still  less  applicable  to  the  question  we 
have  in  hand.  We  must  conclude  that  there  is  no  decisive  authority  against  the 
admission  of  prior  declarations  accompanying  acts  to  show  knowledge,  while  there 
is  some  for  it.  Upon  the  principle  of  the  matter,  we  hold  that  when  made  at  a 
time  not  too  long  before  the  application  and  examination,  and  when  a  part  of  the 
res  gestcD  of  some  act  or  fact  exliibiting  a  condition  of  health  which  they  legiti- 
mately tend  to  explain,  they  are  admissible  to  show  knowledge  in  the  subject  of 
the  insurance  of  his  physical  condition.  Statements  made  by  a  person  while  dis- 
closing a  wound  or  a  sore,  as  to  the  cause  or  nature  of  it,  are  evidence  not  much 
weaker  than  the  existence  of  the  wound  or  sore,  of  his  knowledge  of  his  bodily 
.state.  The  latter  prove  that  he  knew  that  he  was  ailing,  and  no  one  denies  that 
the  proof  of  them  is  admissible  to  show  that  he  was,  and  that  he  knew  it;  the 
former  tend  to  prove  with  more  or  less  certainty,  as  the  cause  and  character  of  the 
ailment  are  more  or  less  in  the  common  and  unskilled  knowledge  of  men,  that 
the  cause  and  character  of  it  are  known  to  him. 

"The  taker  of  a  life  policy  from  insurers,  when  he  asks  payment  after  the 
death,  is  liable  to  an  inquiry  into  the  previous  life  and  condition  of  the  subject 
insured  at  the  time  of  the  application  for  the  insurance,  or  at  a  prior  time,  not 
422 


CH.  X.]  OF   CONCEALMENT.  [§  215 

stated  place  of  residence  was  material  should  be  submitted 
to  the  jury.i  So,  too,  the  fact  that  he  had  been  insane 
twenty  years  before,  if  to  the  applicant's  own  mind  it  was 
material. 2  So  a  misstatement  as  to  his  pecuniary  condition 
and  relations  may  be  material,  if  made  to  the  medical  ex- 
aminer, whose  decision  upon  the  quality  of  the  risk  might 
be  influenced  by  the  fact  that  the  applicant  had  the  means 
to  take  proper  care  of  himself,^  but  not  a  misstatement 
which  amounts  only  to  an  opinion  as  to  whether  there  has 
been  any  derangement  of  certain  functions,  or  whether  he 
has  had  any  "serious  illness."^  And  in  a  case  reported  by 
Ellis,  it  seems  to  have  been  assumed  that  a  concealment  of 
the  fact  that  the  insured,  a  single  woman,  had,  a  year  or 
two  before,  had  a  child,  was  material.  So  the  physician 
was  permitted  to  testify.  But  there  was  another  good 
ground  of  defence,  and  the  case  upon  this  point  cannot  be 
entitled  to  much  weight.^     And  it  seems   that   pregnancy, 

remote  therefrom.  All  facts  may  be  proven  which  tend  to  show  that  condition, 
because  he  has  a  legal  relation  to  them,  and  they  legitimately  atfect  his  right  to 
the  contract  which  he  has  got.  As  he  presents  the  subject  of  insurance  to  tlie 
insurers  as  one  who  for  him  may  make  answer  to  their  material  inquiries,  and  as 
one  who  to  the  extent  of  his  knowledge  will  make  answers  thereto  truthfully,  he 
has  a  legal  relation  to  the  subject  of  insurance,  and  is  bound  by  his  answers  of 
material  facts,  and  is  affected  by  his  knowleilge  and  his  answering  accordino- 
thereto,  or  variant  therefrom.  Hence  it  is  that  any  prior  fact  or  act  not  too  re- 
mote is  proof  against  the  policy-holder  of  knowledge  concealed  by  the  subject  of 
the  insurance.  Hence  it  is,  too,  that  any  statement  which  is  part  of  the  res  gestce 
of  such  prior  fact  or  act  tending  to  characterize  and  explain  it,  is  also  proof  there- 
of, though  unsworn  to. 

"Facts  occurring  after  the  insurance  has  been  effected  may  be  evidence, 
inasmuch  as  all  facts  which  are  material  are  competent  to  be  proven.  But  the 
subsequent  statements  of  the  subject  of  insurance,  not  connected  with  a  contem- 
porary act  or  fact,  are  then  but  hearsay,  for  in  such  case  the  policy-holder  has 
no  such  legal  relation  to  the  subject  as  that  the  latter  may  affect  him  by  his  un- 
sworn declarations  ;  and  the  declarations  have  no  such  connection  with  any  prior 
act  or  fact  as  to  be  a  part  of  the  res  gestce-  thereof."  But  this  case  is  in  turn  criti- 
cised and  denied  in  Hurd  v.  Missouri,  &c.  Society  (Supr.  Ct.  Indianapolis),  6  Ins. 
L.  J.  799.     See  also  Wilson  v.  Life  Association,  C.  Ct.  (Mo.),  6  Ins.  L.  J.  240. 

1  Huguenin  v.  Rayley,  6  Taunt.  186. 

2  Mallory  v.  Travelers?'  Ins.  Co.,  47  N.  Y.  52. 

3  Valtou  V.  Nat.  Loan  Fund  Ass.  Soc,  1  Keyes  (N.  Y.),  21,  reversing  s.  c. 
17  Abb.  (N.  Y.)  Pr.  Cas.  278. 

*  Hogle  V.  Guardian  Life  Ins.  Co.,  6  Robt.  (N.  Y.)  567.  And  see  post, 
§  296. 

6  Edwards  v.  Barrow,  Ellis,  Ins.  116. 

423 


§  215  A]     insurance:  fire,  life,  accident,  etc.  [ch.  x. 

though  not  inquired  about>  may  be  a  material  fact  to  com- 
municate.^ As  the  right  of  lien  is  vital  to  the  existence  of 
mutual  insurance  companies,  an  omission  to  state  an  incum- 
brance, especially  if  inquired  about  and  answers  in  the  ap- 
plication are  agreed  to  be  true  and  full,  is  conclusively 
material  as  matter  of  law.^  Otherwise  in  stock  companies, 
if  not  inquired  about.  ^  And  a  false  answer  to  an  inquiry 
about  prior  applications  is  fatal.'* 

[§  215  A.  A  warehouse  erected  within  forty-one  feet  of  a 
factory  increases  the  risk,  and  if  not  disclosed  when  asking 
for  a  renewal,  a  policy  issued  in  renewal  will  be  void.^  In 
a  diagram  of  the  insured  premises,  a  failure  to  state  that  a 
contiguous  building  contained  benzine  was  held  a  material 
concealment  under  the  terms  of  the  policy  prohibiting  ben- 
zine, and  avoided  it.  The  company  could  not  be  presumed 
to  know  that  benzine  was  necessary  in  the  manufacture  of 
barrels.^  Where  the  assured  had  released  the  railroad  com- 
pany from  liability  for  fires  that  might  be  caused  by  the 
engines,  but  did  not  mention  this  fact  to  the  insurer,  it  was 
a  question  for  the  jury  whether  such  concealment  was  mate- 
rial, in  determining  which  they  might  consider  whether  the 
insurer  was  in  the  habit  of  making  any  different  rates  in 
reference  to  the  existence  or  non-existence  of  the  right  of 
subrogation.^  If  we  are  to  take  the  analogy  of  marine  in- 
surance the  case  is  clear,  for  marine  insurers  habitually 
charge  a  higher  premium  where  the  recourse  against  the 
carrier  is  limited  or  denied,  and  the  plaintiffs  knowing  this 
must  disclose  an  arrangement  by  which  the  carrier  was  to 
be  responsible  only  for  negligence. ^  It  is  just  that  the 
company  should  know  about  a  release  of  the  carrier,  and  if 
the  concealment  is  intentional  there  could  be  no  question  of 

1  Lefavour  V.  Insurance  Co.,  1  Phila.  558. 

2  Bowditch  Mut.  Fire  Ins.  Co.  v.  Winslow,  3  Gray  (Mass.),  415. 

5  Delahay  v.  Memphis  lus.  Co.,  8  Humph.  (Tenii.)  684. 

4  Ellington  v.  Mtna  Life  Ins.  Co.,  77  N.  Y.  564.     [See  §  188  C] 

6  [Peoria  Sugar  Ref.  Co.  v.  People's  Fire  Ins.  Co.,  52  Conu.  581.] 
6  [McFarland  v.  Peabody  Ins.  Co.,  6  W.  Va.  425,  435.] 

^  [Pelzer,  &c.  Co.  v.  St.  Paul  Fire  &  Mar.  Ins.  Co.  (S.  C),  1890.] 
'  [Tate  V.  Hyslop,  15  Q.  B.  D.  368.] 

424 


CH.  X.]  OF   CONCEALMENT.  [§  215  B 

the  propriety  of  holding  the  company  released,  but  if  merely 
inadvertent  it  seems  scarcely  proper  in  the  absence  of  in- 
quiry  or  usage  to  require  a  statement  so  unlikely  to  appear 
relevant  to  any  but  those  who  understand  the  law  of  subro- 
gation. Concealment  of  the  probable  loss  of  a  vessel  at  the 
time  of  insurance  is  fatal.  ^  A  concealment  of  material  facts 
wliieh  the  insurer  is  not  hound  to  know  avoids  the  policy, ^  and 
though  ruinous,  they  must  be  disclosed.^] 

§  215  B.  Facts  deemed  immaterial.  —  On  the  other  hand, 
it  has  been  held  that  the  failure  to  mention  that  the  appli- 
cant is  insolvent,  and  that  there  are  judgments  against  him 
which  constitute  a  lien  upon  his  property,  is  not  a  conceal- 
ment.^ So,  it  seems,  of  a  failure  to  state  that  the  insurer's 
agent  had  declined  a  risk  in  the  same  block,  the  matter  not 
having  been  inquired  about.  The  declination  might  be  for 
a  reason  showing  that  it  was  quite  immaterial,  for  instance, 
that  the  insurers  had  already  a  risk  in  the  particular  block 
to  the  full  extent  permitted  by  their  rules ;  or  it  might  be 
for  a  reason  showing  that  it  was  to  some  extent  material, 
as,  for  instance,  that  the  risk  was  a  specially  hazardous  one. 
Still  the  principal  is  presumed  to  know  what  the  agent 
knows,  and  there  can  be  no  concealment  of  a  fact  known  to 
the  insurers.^  So  a  Northern  man  living  in  a  Southern 
community  was  not  bound  to  state  that  the  people  were 
hostile  to  him,  or  that  the  forces  who  had  possession  of  the 
neighborhood  and  guarded  the  property  sometimes  smoked 
pipes  and  had  fires  in  the  vicinity.  All  this  the  insurers 
were  presumed  to  know  might  be  the  case,  from  the  known 
fact  of  the  existence  of  hostilities.®  In  France,  where  the 
fact  undisclosed  does  not  amount  to  a  concealment  which 
avoids  the  policy,  but  nevertheless  relates  to  a  fact  which  if 

1  [Hart  r.  British,  &c.  Ins.  Co.,  80  Cal.  440.] 

2  [Vale  V.  Phcenix  Ins.  Co.,  1  Wash.  282,  284.] 
8  [Durvell  v.  Bederly,  Holt  N.  P.  283,  286.] 

4  City  Fire  Ins.  Co.  v.  Carrugi,  41  Ga.  660  ;  Delahay  v.  Memphis  Ins.  Co., 
sii,pra. 

6  Lightbody  v.  North  Am.  Ins.  Co.,  23  Wend.  (N.  Y.)  18  ;  Goodwin  v.  Lan- 
cashire Ins.  Co.,  18  C.  L.  J.  (Q.  B.)  1. 

6  Keith  V.  Globe  Ins.  Co.,  52  111.  518. 

425 


§  215  D]      insurance:  fire,  life,  accident,  etc.  [ch.  x. 

known  would  have  required,  by  the  rules  of  the  company,  a 
higher  rate  of  premium,  the  insurers  are  allowed  to  deduct 
from  the  loss  the  difference  between  the  premium  actually 
}iaid  and  that  which  would  have  been  required  if  the  fact 
had  been  known. i  An  agreement  between  the  mortgagee 
and  mortgagor,  that  the  latter  shall  pay  the  premium  upon 
an  insurance  in  the  name  of  the  latter,  is  not  a  fact  material 
to  be  disclosed.  2  Nor  need  the  not  unusual  mode  of  use  or 
manner  of  heating  or  lighting  the  property  insured  be  stated, 
unless  inquired  for.* 

[§  215  C.  A  brick  oven  is  not  as  matter  of  law  so  unusual 
or  material  that  its  concealment  is  fi^audulent.^  The  con- 
cealment of  the  fact  that  the  master  who  runs  the  insured 
ship  owns  one-half  interest  in  her,  is  not  a  material  one 
which  would  avoid  the  policy.^  The  assured  are  only  bound 
to  communicate  facts,  not  sensations  and  apprehensions.^ 
Nor  need  there  be  disclosure  of  anything  with  respect  to  a 
fact  in  regard  to  which  there  is  an  express  or  implied 
warranty.'] 

[§  215  D.  Ordinary  Diligence  in  communicating  facts  is  all 
that  is  necessary.  Knowledge  coming  to  the  insured  pend- 
ing negotiations  for  a  policy  must  with  due  and  ordinary 
diligence  be  transmitted  to  the  company.^  But  an  omission 
to  send  material  information  to  the  underwriters  by  an  unus- 
ual way  which  would  have  caused  it  to  reach  them  before 
the  policy  was  effected  will  not  vitiate  the  same,  though  by 
sending  it  by  an  ordinary  route,  it  did  not  reach  them  before 
the  issuing  of  the  policy.^] 

1  Ass.  Terrestris  c.  Hoffman,  Dalioz,  Jur.  Gen.  1845,  1823. 

2  Kernochan  v.  N.  Y.  Bowery  Ins.  Co.,  17  N.  Y.  428,  reversing  s.  c.  5  Duer 
(N.  Y.  Superior  Ct.),  1. 

3  Girard  Fire  &  Mar.  Ins.  Co.  v.  Stephenson,  37  Pa.  St.  293 ;  Clark  v.  Manuf. 
Ins.  Co.,  8  How.  (U.  S.)  235  ;  Boggs  v.  American  Ins.  Co.,  30  Mo.  63  ;  Barralou 
V.  Royal  Ins.  Co.,  15  L.  C.  3  ;  ante,  §  208  ;  post,  §  245,   sxib  finem. 

*  [Richards  v.  Washington  Fire  &  Mar.  Ins.  Co.,  60  Mich.  420.] 

5  [Russ  V.  Waldo  Mut.  Ins.  Co.,  52  Me.  187,  190.] 

6  [Bell  V.  Bell,  2  Camp.  475,  479.] 

'  [DeWolf  u.  N.  Y.  Firemen's  Ins.  Co.,  20  Johns.  214,  229.] 

8  [M'Liuiahan  v.  Universal  Ins  Co.,  1  Pet.  170,  185.] 

9  [Green  v.  Merchants'  Ins.  Co.,  10  Pick.  402,  407.] 

426 


CH.  XI.]     SPECIAL   PROVISIONS   OF   THE   CONTRACT,   ETC. 


CHAPTER   XI. 

SPECIAL  PROVISIONS  OF  THE  CONTRACT,  INCREASE  OF  RISK, 
ALTERATION,  USE,  VACANCY,  WATCHMAN,  WORKING  OP 
MILLS,    CARE   OF   BOOKS,    ETC. 

STANDARD   CONDITIONS    IN   CANADA   AND    MASSACHUSETTS. 

Analysis. 

1.    General. 

§  216.  Breach  of  condition  renders  the  contract  voidable  not  void  (§§  216, 

36.5).     If  no  time  is  specified  a  reasonable  time  is  intended  ;  see 
also  §  225. 
§  217.  Two  classes  of  stipulations,  those  relating  to  matters  prior  to  loss 

and  determining  the  risk,  and  those  relating  to  matters  aris- 
ing after  the  loss,  and  relating  to  its  establishment,  adjust- 
ment, and  recovery, 
courts  are  strict  in  dealing  with  the  former,  they  are  cautious 
about  fixing  the  liability  of  the  insurer  (so  it  is  said,  though 
some  may  fail  to  see  it),  but  once  fixed  they  are  reluctant  to 
let  the  insured  lose  his  indemnity  for  lack  of  a  formality, 

2.    Incuease  of  Risk. 

§  218.  There  is  usually  a  provision  against  increase  of  risk,  and  there  is 

always  an  implied  promise  not  to  increase  it  by  changes  be- 
yond what  good  faith  would  sanction  interpreted  in  the  light 
of  custom.      The   question  of  increase  is  for  the  jury  even 
where  expert  testimony  is  uncontradicted. 
Any  hazardous  use,  whether  among  those  enumerated  in  the 
policy  or  not,  avoids  it,  under  the  general  stipulation  against 
increase  of  risk. 
A  mere  intent  to  violate  a  condition,  however,  is  not  fatal, 
though  steps  have  been  taken  toward  its  execution,  §  218  ; 
see  §  236. 
Sometimes  the  policy  provides  that  it  shall  only  be  suspended 

during  the  increase  ;  see  also  §  245. 
A  reinsurer  is  liberated  by  increase  of  risk,  though  the  insurer 

consent  to  it. 
Increase  between  application  and  issue  of  policy  fatal. 
§§  219,  220.  Such  slight  variations  of  risk  as  are  incident  to  the  ordinary 

uses  of  the  property  are  not  fatal,  §  219. 
otherwise  with  the  erection   of  an  oven,  new  buildings, 
or  machinery,  moving  a  steam  engine,  &c.,  §  220. 
It  is  immaterial  under  the  usual  clause  whether  the  loss  was 
caused  by  the  increase  or  not,  §  220. 

427 


INSURANCE,  FIKE,   LIFE,   ACCIDENT,   ETC.  [CH.  XL 

c  220.  If  the  insured  has  two  policies  from  the  same  office,  a  permis- 

sion to  increase  the  risk  under  one  policy  saves  the  other. 
§  221.  Notice  to  and  assent  by  the  insurer  ;  see  also  §§  222-225. 

both  must  be  within  a  reasonable  time. 

no  notice  necessary  of  a  change  not  increasing  the  risk. 

agent  may  waive  written  assent,  §  221. 

ordinary  diligence  in  giving  notice  is  sufficient ;  see  §  215  D. 

3.    Alteration,  &c. 

§§  222-226.  An  alteration  may  or  may  not  be  material,  e.  g.  the  substitution  of 
slate  for  shingles  would  not  increase  the  risk  (§  222),  while 
adding  a  story  to  a  house  would,  §  257. 

Property  removed  ceases  to  be  insured  until  replaced  (§  222  ; 
see  also  §  188  A),  unless  the  change  is  so  slight  as  to  be  un- 
important, as  from  first  floor  to  basement  (§  222).  In  the 
absence  of  express  stipulation  the  materiality  of  an  alteration 
depends  on  the  question  whether  it  would  have  raised  the 
rate  of  premium  (§  223  ;  see  also  §  261 ). 

Repairs  necessary  to  the  use  of  the  jiroperty,  and  acts  of  ordi- 
nary ownership  such  as  are  sanctioned  by  usage  do  not  violate 
the  condition  against  alteration  or  increase  of  risk,  §  224. 

The  materiality  of  an  alteration  may  be  taken  out  of  the 
region  of  debate  by  agreement  of  the  parties  that  a  given 
change  shall  be  fatal,  §  223. 

Substantial  fxilfilment  of  the  warranty  sufficient,  §  223. 

The  opening  of  a  new  door,  making  a  new  closet,  putting  in  a 
brick  floor,  or  an  iron  grate,  changes  the  identity  of  the 
property,  chaiujes  the  risk  but  does  not  materially  increase 
the  risk.  Not  to  allow  such  common  and  trivial  alterations 
would  be  an  irrational  construction.  §  224. 
§  225.  If  the  enlargement  or  other  change  be  within  the  limits  of 

honest  dealing  the  insured  is  not  prejudiced,  though  the  loss 
was  actually  due  to  the  alteration.      (See  also  §  230.)     Per- 
mission to  make  necessary  alterations  and  repairs  does  not 
sanction  a  large  addition. 
§  226.  If  part  of  the  change  increases  and  another  part  decreases  risk 

the  jury  may  strike  the  balance. 
§  227.  A  material  alteration   by  a  tenant  or  agent  without  knowledge 

of  the  insured  is  fatal  unless  the  terms  of  the  policy  other- 
wise express,  as  where    the   increase  is  to  be    by  "means 
within  the  control  of  the  assured." 
§  228.  "  Premises  "  means  building  ;  see  also,  §§  239  B,  243. 

§  229.  "  Alteration  at  risk  of  insured." 

§  23L  A  statement  of  present  use  not  a  warranty  of  its  continuance. 

(See  also,  §§  247,  248,  250-252,  157,  191.)  An  enlarged 
use  for  a  permitted  purpose  does  not  avoid. 

4.    Classification  of   Risks. 

§  232.  Goods  are  often  classified  into  hazardous,  extra-hazardous,  memo- 

randum articles  not  insurable  at  all  or  only  on  special  condi- 
tions, &c.,  and  a  policy  insuring  one  class  will  be  avoided  if 
a  more  hazardous  class  is  kept  in  stock  or  mixed  with  the 

428 


CH.  XI.]      SPECIAL   PROVISIONS    OF   THE    CONTKACT,   ETC. 

stock  insured.     To  hold  otherwise  would  compel  an  insurer 
to  bear  a  loss  for  a  lower  premium  than  that  for  which  he 
would  knowingly  have  assumed  the  risk, 
where  there  is  no  bad  faith,  however,  a  rule  similar  to  that 
spoken  of  in  §  215  B,  as  prevailing  in  France,  might  be 
applied  with  advantage. 
§  233.  If  however  the  policy  describes  the  stock  insured  as  such 

as  is  "  usually  kept  in  a  country  store,"  the  scope 
of  the  policy  is  thereby  enlarged  to  cover  any  arti- 
cle in  the  non-insured  classes  ;  if  they  are  "  usu- 
ally kept,"  §§  233,  239. 
such  is  the  general  current  of  authority,  though  there 
are  cases  which  hold  that  the  clauses  of  exclusion 
are  paramount,  and  govern  the  general  description 
of  the  stock,  §  233  ;  and  see  §  238. 
in  most  of  these  cases  it  will  be  found  that  the  policy 
expressly  stated  that  the  clause  of  exclusion  should 
operate  upon  the  prohibited  articles   unless  they 
were    specially  provided  for,  or  that  mere  general 
terms  should  not  overcome  the  prohibition. 
"goods  usually  kept  in  a  country  store,"  §  233,  n. 

may  include  benzine,  saltpetre,  gunpowder,  &c. 
"stock  of  groceries"  includes  saltpetre,  §  233,  n. 
"  stock  of  confectionery  store  "  includes  fireworks,  but  gro- 
ceries, liquors,  and  tobacco  does  not,  §  233. 
but  if  a  special  clause  allows  a  reasonable  quantity,  more 

will  be  fatal,  in  spite  of  usage,  §  233,  n. 
if  the  "usually  kept"   clause  is  followed  by  "except  as 
hereinafter  provided,  the  "  printed   conditions  govern, 
§  233,  n. 
§  234.  But  a  permissive  clause  is  strictly  construed,  whether  express 

or  implied,  e.  g.,  though  gunpowder  or  kerosene  may  be  kept 
for  sale,  they  cannot  be  manufactured  or  kept  for  other  pur- 
poses than  sale  ;  see  also  §  239. 
§  235.  Hazardous  goods  are  those  which  increase  the  risk  of  fire. 

§  236.  Hazardous  trades.     By  reason  of  the  context  a  permission  of 

"extra-hazardous"  construed  to  permit  "specially  hazard- 
ous "  trades. 
§  237.  An  additional  use  of  the  same  grade  of  hazard  as  those  per- 

mitted avoids  the  policy  (as  putting  in  one  more  stove,  see 
§  220,  n.).     An  accumulation  of  hazards  increases  the  risk. 
Making  excelsior  in  a  spool  factory  fatal,  though  not  as  haz- 
ardous as  the  business  insured. 
§  239.  Where  a  stock  of  goods  or  property  used  in  business,  &c.,  is 

described  as  insured,  without  qualification,  this  written  de- 
scription controls  inconsistent  printed  conditions  (see  also 
§  283  .and  general  rule,  §  177)  ;  e.  g.,  the  insurance  of  a 
"printing  business"  in  which  camphene  is  in  customary 
and  necessary  use,  is  not  avoided  by  a  clause  excluding  lia- 
bility for  loss  by  camphene,  though  the  loss  actually  occurred 
by  dropping  a  match  into  a  pan  of  that  fluid.  All  that  is 
properly  incidental  to  the  business  insured  is  also  insured. 

429 


INSURANCE,   FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  XI. 

S  239  A.  Gasoline,  petroleum,  &c. 

under  a  policy  on  a  factory  prohibiting  petroleum  it  may  be 
used  as  a  lubricator,  if  such  is  the  custom. 

"  only  sperm-oil  and  lard  as  lubricator  "  not  broken  by  using 
petroleum  mixture  if  as  good  and  safe. 

"  lamps  to  be  filled  by  daylight." 

"  kerosene  allowed  for  light  in  dwelling,"  clerk  sleeping  in 
store  will  not  make  it  a  "  dwelling." 

court  not  judicially  notice  that  gin  and  turpentine  are  in- 
flammable. 
§  239  B.  Gunpowder,  fireworks,  nitro-glycerine,  &c. 

*'  75  lbs.  allowed,"  mere  casual  presence  of  more  not  fatal,  it 
not  appearing  to  have  caused  the  loss. 

policy  on  goods,  to  be  void  if  powder  kept  on  "premises  in- 
sured," not  void  for  powder  in  buildings  not  insured,  though 
insured  goods  are  there.  Premises  means  real  estate  ;  see 
also  §  228. 

prohibition  of  gunpowder  does  not  keep  out  fireworks. 

"Yankee  notions  "  covers  fireworks,  "  groceries,  liquors,  and 
tobacco  "  does  not. 

5. 

§  240.  The  hiring  of  carpenters  to  make  constantly  needed  repairs  does 

not  avoid  a  policy,  though  the  working  of  carpenters  is  stated 
in  the  printed  conditions  to  be  fatal ;  otherwise  with  extensive 
alterations. 
R  241.  "  Use,"  "keeping,"  &c.,  when  stipulated  against,  mean  habitual 

use,  keeping,  &c.     The  condition  is  not  violated  by  casual  use. 
But  a  single  use,  if  it  is  the  cause  of  loss,  is  fatal  (note). 
§  242.  "  Storing  "  means  keeping  to  redeliver  as  received  ;  keeping  a  quan- 

tity to  replenish  stock  is  not  storing,  nor  keeping  for  sale.     If 
company  knows  premises  may  be  used  to  store  cotton  and  pro- 
vides for  additional  premium,  the  storing  is  not  fatal. 
§  243.  "  Keeping."     "  Premises  "  means  real  estate. 

§  244.  Change  in  surrounding  circumstances.    Good  faith  is  a  part  of  every 

contract,  and  if  an  act  in  violation  of  good  faith  causes  loss 
there  can  be  no  recovery,  although  no  express  stipulation 
of  the  policy  covers  the  act.  An  act  in  bad  faith,  however, 
which  does  not  cause  loss,  is  without  effect  on  the  policy, 
change  of  use  from  that  described  is  not  necessarily  fatal.  If 
it  does  not  materially  increase  the  risk,  only  express  provi- 
sion against  change  can  make  it  fatal. 
§  245.  Suspension  of  policy  follows  temporary  increase  of  risk  (see  also 

§  222).  If,  however,  by  the  terms  of  the  policy  the  introduction 
of  a  steam-engine  avoids  it,  such  introduction  will  be  fatal 
though  the  engine  is  removed  before  the  fire.  The  contrary 
has  however  been  held  even  where  the  policy  was  to  be  "  imme- 
diately void."  A  hahit  of  breaking  conditions  is  of  no  conse- 
quence if  there  is  none  at  the  time  of  loss.  Smoking,  bar-room, 
bawdy-house,  bowling-alley,  after  expiration  of  license  (note). 
§  246.  "  Unlawful  use  "  not  a  single  misdemeanor,  or  a  casual  use.    There 

must  be  a  use  substantial  in  its  continuance,  and  attach- 
ment to  the  premises. 

430 


CH.  XI.j      SPECIAL   PKOVISIONS   OF   THE   CONTKACT,   ETC. 

that  A,  whose  life  is  insured  by  B,  goes  on  an  illegal  voyage 
without  B's  knowledge  is  immaterial,  there  being  no  prohi- 
bition in  the  policy. 
§  246  A.  Knowledge  by  president  of  addition  made  under  verbal  assent 

estops  company. 
If  company  knew  buildings  have  been  or  are  to  be  used  as  exhibi- 
tion buildings,  it  cannot  object  to  such  use  or  any  of  its  inci- 
dents. . 
Parol  admissible  to  show  agent's  knowledge  of  increase  of  risk  ; 
permission  to  keep  kerosene,  left  out  of  policy  by  mistake,  &c. 
If  agent  of  insured  to  renew  knows  of  increase  of  risk  failure  to 
disclose  is  fatal. 

6. 

§§  247-249  J.     Occupancy :  ,  .    .    c 

In  absence  of  express  provision  on  the  subject  ot  vacancy, 
description  of  premises  as  a  "dwelling"  or  as  occupied 
by  a  particular  person,  no  warranty  against  vacancy, 

§  247. 
representation  of  present  status  not  an  agreement  for  its 

continuance,  §  247. 
change  of  tenants  immaterial,  §  247. 
"to  be  occupied  by  a  tenant  "  is  only  an  expression  of 
expectation,  §  248. 
unless  the  time  is  fixed  within  which  the  house  is  to 
become  occupied,  §  248. 
temporary  vacancy  between  tenants  is  not  fatal,  §  249  B. 
nor  on  a  visit  ;  see  §§  248,  249  D. 
nor  stoppage  of  mill  for  repairs,  &c.,  §  248. 
nor  even  complete,   permanent  vacancy,  unless  in 
bad  faith  or  such  as  to  increase  the  risk  materially, 
§§  248,  249  B. 
An  express  provision  against  vacancy  is  necessary,  §§  247, 
248,  249  B. 
unless  the  premises  are  purposely  left  vacant  in  bad  faith, 

§248. 
or  the  vacancy  is  of  such  character  as  to  come  under  the 

increase  of  risk  clause,  §  248. 
ordinarily  it  is  not  an  increase  of  risk,  §  249  B. 

but  if  a  house  is  left  by  the  owner  and  an  intruder 
opens  a  saloon,  the  risk  will  be  increased,  not  by 
the  vacancy,    but  by  what  happened  in  conse- 
quence, §  249  B. 
an  oral  promise  insufficient,  §  248. 
If  there  is  no  "  vacancy  clause,"  good  faith  and  the  "  increase 

of  risk  provision"  are  the  tests,  §§  247-249  B. 
if  there  is  a  vacancy  clause,  its  special  words,  if  not  too  un- 
reasonable to  be  sustained  (§  249  G.),  must  be  added  to  the 
tests,  §§  247-249  B. 
vacant  means  empty  of  all  but  air,  §  249  A. 
unoccupied  means  no  one  in  actual  use  or  possession,  §  249  A. 
terms  must  be  construed  with  reference  to  the  subject-matter, 
§  249  A. 

431 


INSURANCE,    FIRE,  LIFE,   ACCIDENT,   ETC.  [CH.  XL 

the  condition  in  a  policy  on  a  hog  house  refers  to  the  human 
occupation  of  the  dwelling  on  the  premises,  not  to  the  hogs, 
§  249  A. 
requires  practical  use,  §  249  (shop)  ;  but  see  §  249  D  (grain- 
elevators), 
requires  use  as  a  customary  place  of  abode,  §  249  A  (dwelling), 
not  uninterruptedly,  but  the  place  of  habitual  return  and 

stoppage,  §  248,  n. 
leaving  in  charge  of  one  living  near,  not  sufficient,  §  249  A. 
purpose  to  move  into  a  house  though  partly  executed  is 

not  enough,  §§  249  A,  249  C  ;  but  see  §  249  D. 
occupation  of  the  land  is  not  enough,  the  house  must  be 
occupied,  §  249  C. 
the  condition  applies  to  all  the  buildings  on  the  premises, 
§  249  A. 
it  is  distributive,  §  249  A. 
diligence  of  the  insured  does  not  enter  the  question  unless  so 
agreed,  as  by  the  words  "  vacancy  within  assured's  con- 
trol," §  249  F. 
then  insured  must  show  it  was  beyond  control,  §  249  F. 
in  general,  removal  by  tenant,  though  before  lease  is  out 
and  without  knowledge  of  assured,  is  fatal,  §  249  F. 
false  answer  as  to  occupancy  fatal,  §  249  G. 
policy  once  voided  for  vacancy  not  revived  by  reoccupation, 

§  249  G. 
unreasonable  condition,  which  would  avoid  the  policy  if  the 

premises  were  used  or  not,  is  void,  §  249  G. 
by-law  as  to,  subsequent  to  policy,  no  effect,  §  249  G. 
Maine  statute,  §  249  G. 
Vacancy  may  be  waived  : 

expressly  by  writing,  §  249  H. 

or   orally  even   though  the  policy  requires  writing, 
§  249  H. 
or  declares  that  no  agent  can  waive,  §  249  J. 
a  general  agent  may  waive  this  last  requirement  as 
well  as  the  other,  §§  249  H,  249  J. 
impliedly  by  knowledge  of  the  agent. 

state  of  premises  as  to  occupancy  at  time  of  insur- 
ance, 
if  occupation  at  loss  is  same  as  known  to  agent 
at  time  of  insurance,  company  estopped, 
§  249  L 
although  the  applicant  ignorantly  signed  an 
erroneous    application   filled  up   by  the 
agent,  §  249  I. 
but  if  house   once  becomes  occupied  after 
insurance    the     condition    takes     effect, 
§  249  I. 
vacancy  occurring  after  insurance  : 

if  agent  tells  assured  it  will  be  fatal,  no 

waiver,  §  249  \. 
so  if  he  is  merely  silent,  §  249  I. 


432 


CH.  XI.]       SPECIAL   PROVISIONS   OF   THE   CONTRACT,   ETC. 

knowing  that  vacancy  is  likely  to  occur  in  fut- 
ure, no  waiver,  §  249  I.     Tenement,  summer- 
house,  &c, 
general  agent  may  modify  contract  so  as  to  cover  future 
vacancies,  §  249  H. 
if  the  policy  says  unoccupied  buildings  must  be  insured  as 

such,  they  must  be,  §  248. 
no  implied  obligation  to  keep  a  watch  in  a  vacant   house, 

§  248. 
mere  going  out  of  one  tenant  is  not  a  "change  of  tenants  "  till 

new  one  comes  in,  §  249. 
a  vacancy  is  not  an  "alteration  of  use,"  §  249. 
"What  is  a  vacancy  : 

vessel  left  alone,  §  249  C. 

moving  in  just  begun,  §§  249  C,  249  A  ;  but  see  §  249  D. 
leaving  a   few  articles  in  house,  and  non-delivery  of  key  to 
owner  not  sufRcient,  §  249  C. 
nor  supervision  by  one  not  living  in  house,  §§  249  A, 
249  C. 
What  is  not  a  vacancy: 

absence  on  a  visit,  §  248. 

or  a  funeral,  §  249  D. 
leaving  summer-house  in  winter,  §  248  ;  see  however,  §  249  I. 
temporary  suspension  of  a  mill,  §  248. 

for  repairs,  or  because  of  low  water,  §  248. 
casual  absence  on  night  of  fire,  §  249  D. 
moving  in  nearly  complete,  §  249  D. 
sleeping  in  adjoining  house  not  fatal,  §  249  D. 
if  any  one  of  the  "  family  "  remains  it  is  sufficient,  §  249  D. 

or  if  part  of  a  tenement  house  is  occupied,  §  249  D. 
grain  elevator  not  vacant  if  owner  keeps  his  papers  there  and  is 
in  and  out,  §  249  D. 
Notice  of  vacancy : 

must  be  given  if  required  by  the  policy,  §  248. 
Temporary  vacancy  between  tenants  not  fatal  as  an  increase  of  risk, 
§  249  B. 
but  is  under  the  vacancy  clause,  §  249  B. 
even  though  the  fire  was  smouldering  unnoted  before  the  ten- 
ant left,  §  249  B. 
"Vacant  and  so  remain  : " 

means  vacant  until  loss,  §  249  E. 

agent's  knowledge  of  vacancy  at  time  of  consenting  to  transfer 
does  not  waive  the  condition  as  to  remaining,  §  249  E. 

7. 

§§  250-252.  Watchman.  No  implied  obligation  to  keep  watch  in  a  vacant 
house,  §  248.  Statement  that  a  watch  is  kept,  sometimes 
held  a  warranty  ;  contrary  to  the  general  rule  that  the  courts 
will  not  find,  warranties  where  the  parties  have  not  clearly 
made  them,  on  the  ground  of  the  great  importance  of  the 
watch  being  continued.  The  true  ground  and  the  one  that 
VOL.  I.— 28  433 


INSURANCE,   FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  XI. 

harmonizes  many  of  the  cases,  is  that  a  change  beyond  the 
limits  of  good  faith  will  be  fatal,  and  where  the  question  as 
to  the  present  state  of  things  refers  to  a  matter  the  continu- 
ance of  which  is  of  mxich  importance,  so  that  the  question  is 
manifestly  intended  to  discover  the  nature  of  the  risk  the 
company  has  to  take,  the  insured  must  be  held  to  know  that 
such  was  the  purpose,  and  conform  to  it  (§  250)  ;  a  provision 
not  to  increase  the  risk  turns  representations  into  warranties 
that  the  present  state  shall  not  be  substantially  changed  for 
the  worse  (§  218)  ;  there  is  good  authority  that  the  condition 
not  to  increase  the  risk  substantially  is  an  implied  condition 
in  every  contract  of  insurance  (§  218)  ;   so  the  logic  of  the 
case  seems   clearly  in  favor  of  the  view  taken  here  and  in 
§  157  ;  see  §  244. 
absence  of  watch  at  meals,  §  251. 
one  who  sleeps  not  a  "  watchman,"  §  252. 
warranty  of  "  watchman  ou  premises  "  is  fulfilled  if  he  is  on 
adjoining  premises  in  better  position  to  watch  than  if  in  the 
mill,  §  252. 
§  253.  Working  of  mills,  hours  of  running.     "  Constantly  worked  "  means 

during  ordinary  hours.      "Worked   by  day,"  no  breach  if 
engine  works  at  night, 
stoppage  for  repairs. 
§  253  A.  Condition  against  ceasing  operations  not  broken  by  stop  because 

of  epidemic,  or  permitted  repairs,  nor  by  suspension  of  jmrt 
of  the  business,  unless  the  condition  expressly  and  undoubt- 
edly includes  such  stoppage. 
R  253  B.  Agent's  knowledge  before  issue  of  policy  that  a  factory  or  dis- 

tillery is  run  at  night,  &c.,  estops  the  company  to  set  up 
the  condition  against  such  running.  {Contra,  Massachu- 
setts, and  probably  some  other  States  ;  see  §  145  et  scq.) 
but  agent's  knowledge  of,  or  even  company's  verbal  assent 
to,  an  intention  to  do  an  act  in  the  future,  will  not  estop  it. 
§  254.  "Mill  examined  after  work."'     At  what  time  work  ceases  question 

for  jury. 
§  255.  Warming  ;  care  of  stoves  ;  ashes  to  be  put  on  brick  not  wood  ;  iron 

shutters. 
§256.  Misdescription  of  ownership  or  of  the  property  or  its  occupancy, 

will  not  in  general  avoid  the  policy  unless  so  expressly 
stipulated. 
clerk  slept  in  store,  mere  representation  not- warranty. 
§  257.  "Filled  in  with  brick"  held  a  warranty;  (see  effect  of  usage, 

§  261). 
two-story  house  changed  to  a  three-story  after  application  and 
before  issue  of  policy,  fatal  alteration. 
§  258.  Omission  of  outbuildings  (see  also   §  260).     Distance  of  build- 

ings "contiguous."     Diagrams. 
§  259.  "  How  bounded  ;  "   "  situation  ; "  distance  of  other  houses. 

§§  260-262.  If  the  description  is  on  its  face  imperfect  (§  260),  or  il  the 

company  or  its  agents  in  any  way  know  of  the  imperfection 
(§  262),  the  company  cannot  set  up  the  fault.  See  ch.  vii. 
anal.  4,  §§  20'7,  197. 

434 


CH.  XI.]       SPECIAL   PKOVISIONS   OF   THE   CONTRACT,    ETC.         [§  216 

8. 

§  263.  Misrepresentation  of  relationship  to  the  life-subject  fatal. 

§  2t)3  A.  Covenant  to  keep  books  in  safe  at  night  means  after  business  hours, 

adjuster  may  waive  the  covenant. 
Agreement  to  keep  stock  up,  failure  not  fatal  if  stock  gets  below  the 

insurance,  for  the  company  is  benefited. 
Agreement  not  to  question  application  after  death  excludes  evidence 

of  fraud,  or  misrepresentation. 
Policy  to  be  void  if  building  falls,  no  void  by  part  falling. 
§  263  B.  Substantial  comi)liance  with  conditions  is  sufficient. 

Company  estopped  if  performance  is  prevented  by  itself. 

Failure  of  collateral  agreement  to  give  company  all  his  insurance, 

not  fatal  unless  so  expressed. 
Condition  valid  though  ill  worded. 
§  263  C.  No  expert  evidence  as  to  matter  of  common  experience. 

Custom  will  not  determine  question  of  increase  of  risk. 
Burden  of  proving  breach  is  on  company. 
§  263  D.  In  Canada  standard  conditions  are  iixed  by  statute. 

§  263  E.  The  Massachusetts  Public  Statutes   provide  a  very  good  standard 

policy.     Such  statute  conditions  may  however  be  varied  by  the 
parties. 

§  216.  General  Observations;  Effect  of  Breach  of  Condition; 
Presumption  of  Knowledge  of  Condition ;  Notice.  —  In  pro- 
ceeding to  consider  the  scope  and  effect  of  the  various  con- 
ditions "and  stipulations  in  which  the  modern  contract  of 
insurance  abounds,  it  is  of  the  first  importance  to  determine 
whether  they  are  in  tlie  nature  of  warranties  or  representa- 
tions, and  if  so,  whether  they  are  affirmative  or  promissory, 
and  also  whether  they  are  themselves  controlled  by  acces- 
sory stipulations  as  to  their  truth,  fulness,  and  materiality. 
Some  policies,  as  we  have  seen,  seek  to  make  all  the  state- 
ments in  the  application  warranties  by  making  them  by 
express  stipulation  a  part  of  the  contract,  while  others  stip- 
ulate that  they  are  to  be  referred  to  for  a  limited  purpose 
only,  as  for  the  purpose  of  description  and  identification,  or 
stipulate  for  the  truth  of  all  facts  stated,  or  for  their  truth 
only  so  far  as  risk  or  value  is  concerned,  or  so  far  as  is 
-  known  to  the  insured,  or  they  are  material  to  the  risk,  or 
are  inquired  for,  or  for  their  truth  in  all  these  respects ;  or 
refer  to  the  statements  in  the  application,  which  by  refer- 
ence is  made  part  of  the  contract,  as  representations,  or  as 
to  be  used  and  resorted  to,  to  explain  the  rights  and  obliga- 
tions of  the  parties.     Much  depends  upon  the  proper  solu- 

435 


§  217]  INSURANCE:  FIRE,   LIFE,  ACCIDENT,   ETC.  [CH.   XI. 

tion  of  these  preliminary  questions,  as  will  be  seen  by  a 
perusal  of  the  preceding  chapters,  in  which  we  have  en- 
deavored to  state  some  of  the  general  principles  applicable 
thereto.  Bearing  these  in  mind,  we  shall  be  better  able  to 
arrive  at  satisfactory  conclusions  upon  the  many  perplexing 
questions  which  will  arise,  and,  guided  by  their  light,  we 
shall  find  that  many  decisions,  apparently  contradictory  and 
irreconcilable,  are  not  so  in  fact,  but  stand  well  upon  the 
special  circumstances  of  the  case  and  the  special  stipula- 
tions of  the  contract  under  consideration. 

It  is  well,  also,  to  bear  in  mind  that  a  breach  of  condi- 
tion, of  whatever  character,  does  not  necessarily  avoid  the 
policy;  it  merely  renders  it  voidable,  at  the  option  of  the 
insurers.  1 

The  presumption  is  that  the  conditions  of  the  contract  are 
known  to  both  the  parties  thereto,  but  the  presumption  is 
not  conclusive.  It  may  be  shown  that  such  was  not  the 
fact.  2 

Where,  by  the  conditions  of  the  policy,  notice  of  any  par- 
ticular fact  is  to  be  given  the  insurers,  as  that  the  house 
insured  has  become  vacant,  no  time  being  specified,  on  pain 
of  forfeiture,  the  more  sound  and  sensible  rule  is,  that  if 
the  notice  be  given  within  reasonable  time,  whether  it  be 
before  or  after  the  loss,  the  condition  will  be  complied  with. 
Though  it  has  sometimes  been  said  that  the  notice  must  be 
given  before  the  loss,  at  the  peril  of  the  insured  if  he  fail. 
The  condition  being  to  give  notice,  if  this  be  done  within 
reasonable  time,  it  is  difficult  to  see  where  or  how  there  is 
any  breach.  ^ 

§  217.  Two  Classes  of  Stipulations.  —  There  are  two  gen- 
eral classes  of  these  stipulations  which  it  is  well  to  notice; 

1  [Turner  v.  Meridan  Ins.  Co.,  16  Fed.  Rep.  454,  457] ;  post,  §  365. 

2  Bissell  V.  Am.  Fire  Ins.  Co.,  2  Hughes,  C.  Ct.  531  ;  Keller  v.  Equitable 
Fire  Ins.  Co.,  28  Ind.  171  ;  Geib  v.  International  Ins.  Co.,  1  Dill.  C.  Ct.  443, 
449  ;  Chatillon  u.  Canadian  Mut.  Fire  Ins.  Co.,  27  U.  C.  (C.  P.)  450  ;  Cheever 
V.  Union  Central  Ins.  Co.,  Superior  Ct.  Cincinnati,  5  Big.  Life  &  Ace.  Ins. 
Cas.  458. 

3  Canada  Landed  Credit  Co.  v.  Canada  Agr,  lus.  Co.,  17  Grant,  Ch.  (U.  C.) 
418 ;  post,  §§  221,  225. 

436 


CH.  XI.]      SPECIAL   PROVISIONS   OF   THE   CONTRACT,   ETC.        [§  218 

first,  those  relating  to  matters  and  things  prior  to  the  loss, 
and  having  for  their  general  object  to  define  and  determine 
the  limits  of  the  risk;  and,  second,  those  which  relate  to 
matters  and  things  occurring  after  the  loss,  and  having  for 
their  object  to  define  and  determine  the  mode  in  which  an 
accrued  loss  is  to  be  established,  adjusted,  and  recovered. 
The  former  pertain  more  especially  to   the   circumstances 
which  affect  the  risk,  such  as  the  character,  habits,  mode  of 
life,  use,   occupation,   alteration,  alienation,  title,  location, 
and  the  like,  of  the  persons,  property,  or  premises  insured, 
and  constitute,  so  to  speak,  the  substance  of  the  contract; 
while  the  latter  pertain  more  especially  to  those  formal  acts 
and  circumstances  which,  when  reciprocal  rights  and  liabili- 
ties have  become  fixed  by  the  terms  of  the  contract,  are  sup- 
plementary thereto,  and  necessary  to  make  it  productive  to 
the  insured  of  the  benefit  sought  thereby.     As  to  the  former, 
relatively  speaking,  there  is  more  strictness  in  holding  par- 
ties to  the  terms  of  the  contract,  and  less  readiness  to  find 
in  the  circumstances  a  waiver  of  their  respective  rights.     In 
other  words,  the  courts  will  proceed  with  caution  in  deter- 
mining the  question  of  the  liability  of  the  insurer ;  but  when 
this  liability  is  fixed  by  the  capital  fact  of  a  loss  within  the 
range  of  their  responsibility,  they  will  be  very  reluctant  to 
deprive  the  insured  of  the  benefit  of  that  liability,  by  any 
failure  or  neglect  to  comply  with  the  mere  formal  requisi- 
tions of  the  contract,  by  which  his  right  is  to  be  made  avail- 
able for  his  indemnification.  1 

§  218.  Increase  of  Risk  generally.  —  [In  every  contract  of 
insurance  there  is  an  implied  agreement  not  to  increase  the 
risk,  whether  anything  is  said  upon  the  subject  or  not.^  If 
the  insured  could  increase  the  risk  he  could  change  the  con- 
tract, which  one  party  to  an  agreement  can  never  do.  There 
is,  however,  almost  always  an  express  provision  on  the  sub- 
ject. Where  a  policy  insured  a  certain  house  from  Feb.  1, 
1851,  to  Feb.   1,  1857,   on  an  application  signed  October, 

1  Hinman  v.  Hartford  Fire  Ins.  Co.,  36  Wis.  159;  Franklin  Fire  Ins.  Co.  v. 
Chicago  Ice  Co.,  36  Md.  102. 

2  [^Hofifecker  v.  N.  C.  C.  M.  Ins.  Co.,  5  Hous.  (Del.)  101.] 

437 


§  218]  insurance:  fike,  life,  accident,  etc.         [CH.  XL 

1850,  and  where  in  March,  1851,  the  plaintiff  added  one 
more  story  to  the  building  without  notifying  the  insurers; 
although    the  policy  was   not   actually  signed  until   Aj)ril, 

1851,  it  was  held  that  the  company  was  not  liable,  as  the 
implied  warranty  of  defendant  not  to  increase  the  risk  had 
been  broken.^]  The  not  unusual  provision,  that  if  the  situ- 
ation or  circumstances  affecting  the  risk  upon  the  property 
insured  shall  be  altered  or  changed,  with  the  consent  of  the 
insured,  so  as  to  increase  the  risk,  the  policy  shall  be  void, 
binds  the  assured  not  only  not  to  make  any  alteration  or 
change  in  the  structure  or  use  of  the  property  which  will 
increase  the  risk,  but  prohibits  him  from  introducing  any 
practice,  custom,  or  mode  of  conducting  his  business  which 
would  materially  increase  the  risk,  and  also  from  discon- 
tinuing any  precaution  represented  in  the  application  to  have 
been  adopted  and  practised  with  a  view  to  diminish  the  risk. 
Its  legal  effect  is,  so  far  as  the  representations  set  forth  cer- 
tain usages  and  practices  observed  in  and  about  the  business 
or  property  insured,  as  to  the  mode  of  conducting  the  busi- 
ness or  management  of  the  property,  and  as  to  precautions 
against  fire,  that  they  are  not  only  an  affirmation  of  the 
truth  of  the  facts  at  the  time  they  are  stated,  but  a  stipula- 
tion that,  so  far  as  the  insured  and  all  those  intrusted  by 
him  with  the  care  and  management  of  the  property  are 
concerned,  such  mode  of  conducting  the  business  shall  be 
substantially  observed,  and  such  precautions  substantially 
continue  to  be  taken  during  the  currency  of  the  policy.  ^ 
And  as  to  both,  the  compliance  should  be  substantial  and  in 
good  faith,  and  not  merely  literal  and  colorable.^  Whether 
the  change  be  material  is  for  the  jury,  and  if  the  jury  find 
that  the  change   increases   the  risk  it  will  be  fatal. ^      In 

1  [Sniem  V.  Thornton,  3  E.  &  B.  868.] 

2  Houghton  V.  Manuf.  Mut.  Fire  Ins.  Co.,  8  Met.  (Mass.)  114  ;  Diehl  v.  Adams, 
&c.  Ins.  Co.,  58  Pa.  St.  443. 

3  Ibid.     And  see  ante,  §  198. 

*  Hobby  V.  Dana,  17  Barb.  (N.  Y.)  Ill  ;  Jennings  v.  Chenango  County  Mut. 
Ins.  Co.,  2  Denio  (N.  Y.),  75  ;  Williams  v.  People's  Ins.  Co.,  57  N.  Y.  274  ;  Manu- 
facturers' &c.  Ins.  Co.  V.  Kunkle  (Mich. ),  8  Ins.  L.  J.  50.  [^It  is  a  question  for  the 
jury  whether  the  use  of  a  steam-engine  for  threshing  materially  increases  the 
risk.  Long  v.  Beeber,  106  Pa.  St.  466  ;  Farmers'  Mut.  Fire  Ins.  Co.  v.  Moyer,  97 
438 


CH.  XI.]      SPECIAL    PROVISIONS    OF   THE    CONTRACT,   ETC.        [§  218 

Stokes  V.  Cox,i  the  Court  of  Exchequer  Chamber  upheld  a 
verdict  reversing  the  judgment  of  the  Court  of  Exchequer 
setting  it  aside,  —  where  it  was  recited  in  the  policy  that  no 
steam-engine  was  employed  on  the  premises,  and  there  was 
a  condition  that  in  case  the  risk  should  be  increased  by  an 
alteration  of  circumstances  the  policy  should  be  void.  There 
was  a  boiler  on  the  premises  at  the  time  of  the  insurance, 
used  for  generating  steam  for  heating  water  and  warming 
the  rooms ;  but  a  steam-engine  was  afterwards  erected.  The 
fact  that  the  policy  stated  that  no  steam-engine  was  em- 
ployed, was  held  not  to  be  a  warranty  that  none  should  be, 
but  under  the  condition  it  might  be  if  it  did  not  increase  the 
risk. 2  A  contemplated  change,  however,  and  preparations 
to  that  end  not  amounting  to  the  actual  entering  upon  the 
new  business,  have  no  effect.  A  warranty  against  engaging 
in  a  more  hazardous  occupation  is  not  violated  by  setting  out 
on  a  journey  with  an  intent  to  engage  in  such  occupation, 
the  life  being  lost  before  any  actual  engagement  therein,  and 
while  on  the  journey,  the  policy  providing  that  the  life  —  a 
slave  —  should  not  be  removed  to  more  southern  latitudes. 
This  implied  that  he  might  be  removed  to  more  northern 
latitudes.  It  was  allowable  to  remove  him,  and  the  loss 
being  occasioned  by  a  high  wind,  and  not  by  the  intention 
to  employ  him  in  a  more  hazardous  occupation,  no  provi- 
sion, express  or  implied,  of  the  policy  was  infringed. ^ 
In  Boatwright  v.  ^tna  Insurance  Company,*  an  attempt 

Pa.  St.  441,  (loss  occasioned  by  the  explosion  of  the  engine  employed  to  thresh 
grain,  materially  left  to  jnry).  The  question  of  an  increase  of  risk  is  always  one 
of  fact  for  the  jury.  Shepherd  v.  Union  Mut.  Fire  Ins.  Co.,  38  N.  H.  232, 
240;  Ritter  v.  Sun  Mut.  Ins.  Co.,  40  Mo.  40,  41.  Even  though  expert  testi- 
mony as  to  the  risk  on  a  building  being  increased  by  vacancy  is  not  contra- 
dicted, the  question  is  for  the  jury.  Uncontradicted  expert  testimony  is  not 
conclusive  except  where  none  but  experts  are  capable  of  forming  a  judgment. 
Cornish  v.  Farm  Buildings  Fire  Ins.  Co.,  74  N.  Y.  295,  297-298.^ 

1  1  H.  &  N.  (Exch.)  320. 

2  In  their  opinion  the  court  alluded  to  the  criticisms  of  Lord  Campbell  in 
Sillem  V.  Thornton  (cited  post,  cli.  xi.),  on  the  cases  of  Shaw  v.  Robberds  and 
Pim  V.  Eeid,  apparently  with  disapprobation,  and  pointed  out  the  fact  that  Sil- 
lem V.  Thornton  did  not  at  all  present  the  case  of  a  change  in  use  increasing  the 
risk,  but  rather  that  of  a  misrepresentation  in  describing  the  property  insured. 

3  Summers  v.  U.  S.  Ins.  An.  &  Tr.  Co.,  13  La.  An.  504. 
*  1  Strob.  (S.  C),  281. 

439 


§  219]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  XI. 

was  made  to  restrict  the  meaning  of  that  clause  of  the  pol- 
icy which  provides  against  any  increase  of  risk  by  the  occu- 
pation of  the  premises  for  hazardous  purposes,  so  that  it 
should  apply  only  to  such  hazardous  uses  as  were  declared 
to  be  so  in  the  classification  of  risks.  But  the  court  did  not 
accept  this  view  of  the  case ;  holding,  on  the  contrary,  that 
the  occupation  for  any  hazardous  purpose,  whether  enumer- 
ated in  the  special  class  or  not,  would  avoid  the  policv. 

In  Schmidt  v.  Peoria  Marine  and  Fire  Insurance  Com- 
pany,i  the  court  go  so  far  as  to  hold  that,  imder  a  general 
stipulation  that  an  increase  of  risk  shall  avoid  the  policv, 
the  right  of  the  insurers  to  object  is  limited  to  those  losses 
which  occur  while  the  increase  of  risk  continues;  and  this 
still  appears  to  be  the  law  of  Illinois.  But  the  courts  of  no 
other  State  have  gone  to  that  extent.  And  the  case  which 
was  referred  to  and  relied  upon  as  having  decided  the  same 
point  in  the  same  way.-  was  one  where  the  policy  expressly- 
provided  not  that  the  policy  should  be  void  if  the  risk  was 
increased,  but  that  if  the  property  should  be  used  or  appro- 
priated to  or  for  any  of  the  prohibited  purposes,  the  policy 
should  cease  and  be  of  no  effect  so  long  as  such  use  con- 
tinued, —  a  provision  which,  so  far  as  the  reported  case 
shows,  does  not  appear  to  have  been  contained  in  the  case 
under  consideration.  A  reinsured  office,  which,  after  the 
reinsurance,  consents  to  an  increase  of  risk,  without  notice 
to  the  reinsurer,  and  takes  to  itself  the  extra  premium,  can- 
not recover  on  the  policy  of  reinsurance.'^ 

§  219,  Increase  howsoever.  —  Even  SO  broad  a  restriction 
to  the  liability  of  the  insurers,  as  that  they  shall  not  be  held 
responsible  if  the  risk  lie  increased  by  any  means  whatever 
without  the  assent  of  the  insurers,  is  to  be  so  interpreted 
that  a  reasonable  use  of  the  property  insured,  having  regard 
to  its  nature  and  circumstances,  may  be  made  by  the  in- 
sured. The  insurance,  unless  the  terms  of  the  contract  for- 
bid, must  be  presumed  to  be  made  with  reference  to  the 

1  41  111.  295. 

2  New  Eng.  Fire  &  Mar.  Ins.  Co.  v.  Wetmore,  32  111.  2-21. 

8  St.  Nicholas  Ins.  Co.  v.  Merchants',  &^.  Ins.  Co.  (N.  Y.),  in  Ins   L  J   137 

440 


CH.  XI.]      SPECIAL    PKOYISIONS   OF   THE   COXTKACT,    ETC.         [§219 

character  of  the  property  insured,  and  to  the  owner's  use  of 
it  in  the  ordinary  way,  and  for  the  purpose  for  which  such 
property  is  ordinarily  held  and  used,  or  to  cover  risks  inci- 
dent to  such  use.  A  farmer,  for  instance,  insures  his  horses 
against  loss  by  fire  and  lightning  for  five  years,  and  de- 
scribes them  as  "kept  on  his  farm,"  or  as  ''stock  on  prem- 
ises," or  his  carriage  "as  contained  in  the  barn."  This 
does  not  preclude  him  from  calling  upon  the  insurers  for 
any  indemnity  if  a  loss  happens  off  the  farm,  as  when  going 
to  church,  or  to  market,  or  to  visit  a  friend  in  the  neighbor- 
hood, or  the  carriage  is  at  the  shop  for  repairs,  or  otherwise 
within  the  ordinary  range  of  uses  to  which  farmers  custom- 
arily put  their  horses.  It  cannot  be  supposed  that  in  such  a 
case  it  is  intended  that  the  insured  shall  get  a  permit  every 
time  he  goes  off  his  farm.  So  precarious  an  insurance  one 
would  hardly  take  the  pains  to  obtain.  ^  So  cars  on  the  line 
of  the  road  will  include  cars  on  spurs  connected  with  the 
road,  though  not  the  property  of  the  road.^  But  where  the 
policy  was  upon  a  car-house  and  the  cars  "  contained  "  in  it, 
it  was  held  to  cover  only  such  cars  as  might  be  in  it.^  So, 
generally,  if  there  is  nothing  in  the  nature  of  the  property 
or  the  mode  of  its  use  to  lead  to  the  inference  that  it  must 
have  been  intended  that  the  property  should  be  covered  not- 
withstanding a  change  of  locality,  as  where  a  stock  of  goods 
is  described  as  contained  in  a  certain  building,  the  liability 
will  be  restricted  to  loss  to  such  goods  only  as  are  in  the 
building.^  Increase  of  risk  means  material  increase,  and 
"additional"  risk  is  not  necessarily  material  increase.^  Nor 
is  a  permission  given  by  the  insured  to  shipwrecked  seamen 

i  Peterson  v.  The  Mississippi  Valley  Ins.  Co.,  24  Iowa,  494  ;  ilills  r.  Farmers' 
Ins.  Co.,  37  Iowa,  400;  Everett,  v.  Continental  Ins.  Co.,  21  Minn.  76;  McCluer 
V.  Girard,  &c.  Ins.  Co.,  43  Iowa,  349  ;  Holbrook  v.  St.  Paul,  &c.  Ins.  Co.,  25  Minn. 
229  ;  s.  c.  and  note,  8  Ins.  L.  J.  789  ;  Longueville  v.  Western  Ass.  Co.,  51  Iowa, 
553,  555.     See  also  post,  §  224. 

2  Fitchburg  R.  Pt.  Co.  v.  Charlestown  Mut.  Fire  Ins.  Co.,  7  Gray  (Mass.),  64. 

8  Annapolis  R.  R.  Co.  v.  Baltimore  Fire  Ins.  Co.,  32  Md.  37. 

*  Harris  v.  Royal  Canadian  Ins.  Co.,  53  Iowa,  236. 

s  Allen  V.  Mutual  Fire  Ins.  Co.,  2  Md.  Ill  ;  Mayor  of  Xew  York  v.  Hamilton 
Mut.  Ins.  Co.,  10  Bosw.  (N.  Y.  Superior  Ct.)  537  ;  Baxendale  v.  Harvey,  4  H. 
&  N.  (Exch.)  445. 

441 


§  220]  INSURANCE  :    FIRE,    LIFE,   ACCIDENT,   ETC.  [CH.  XI. 

to  take  shelter  in  his  storehouse  for  the  night  a  change  of 
risk  in  the  sense  of  the  policy,  although,  in  violation  of  the 
ortk'rs  of  the  insured,  they  kindle  a  fire  in  a  stove  whereby, 
tlie  building  is  set  on  (ire  and  consumed.^  Nor  is  a  policy 
upon  the  building  of  a  farmer  avoided  by  the  increase  of  risk 
consequent  upon  the  use  of  an  itinerant  steam  threshing- 
machine  introduced  temporarily  for  the  purpose  of  threshing 
the  grain  raised  upon  the  premises,  it  being  shown  that 
before  the  issue  of  the  policy  this  was  customary  among 
farmers,  and  the  proceeding  was  incidental  to  the  business.  ^ 
Nor  does  the  clause  against  increase  of  risk  include  ordinary 
repairs ;  ^  and  it  is  limited  and  controlled  by  another  provi- 
sion in  the  same  policy,  that  an  increase  of  risk  from  cer- 
tain specified  causes  shall  only  have  the  effect  to  suspend 
the  policy  while  the  risk  continues.* 

§  220.  Increase  of  Risk.  —  Still  the  general  and  sweeping 
clause  making  the  insured  responsible  for  all  such  changes 
within  his  control  as  increase  the  risk,  is  one  which  needs 
to  be  looked  to  very  carefully,  as  it  applies  to  improvements, 
such  as  the  erection  of  new  buildings,^  or  the  putting  an 
oven  into  a  house  already  built,^  or  the  introduction  of  new 
machinery.'^  And  even  a  removal  of  a  steam-engine  from 
one  place  to  another  on  the  same  premises,  as  from  a  posi- 
tion in  the  court-yard  to  a  place  within  the  building,  may 
amount  to  an  alteration  which,  if  the  removal  is  availed  of 
by  use,  will  avoid  the  policy.^  And  under  the  usual  proviso 
against  increase  of  risk,  if  the  risk  be  increased,  it  becomes 
entirely  immaterial  to  inquire  whether  the  loss  was  occa- 

1  Loud  V.  Citizens'  Mut,  lus.  Co.,  2  Gray  (Mass.),  221. 

2  Bouchet  c.  Caisse  Gen.  des  Ass.  Agr.,  Dalloz,  Jur.  Gen.  1870,  3,  16. 

3  Townsend  v.  Northwestern  Ins.  Co.,  18  N.  Y.  168  ;  Lyman  v.  State  Mut. 
Fire  Ins.  Co.,  14  Allen  (Mass.),  329  ;  Ottawa  Fire  Co.  v.  Lon.  &  Li  v.  &  Globe  Ins. 
Co..  28  U.  C.  (Q.  B.)  .518. 

*  Mayor,  &c.  v.  Hamilton  Mut.  Ins.  Co.,  10  Bosw.  (N.  Y.  Superior  Ct.)  537; 
Bowman  v.  Pacific  In.s.  Co.,  27  Mo.  152. 

^  Murdock  v.  Chenango  County  Mut.  Ins.  Co.,  2  Comst.  (N.  Y.)  210 ;  Francis 
V.  Somerville  Mut.  Ins.  Co.,  1  Dutch.  (N.  J.)  78. 

6  Boatwright  v.  ^tna  Ins.  Co.,  1  Strob.  (S.  C.)  281. 

7  Reid  V.  Gore  Dist.  Mut.  Fire  Ins.  Co.,  11  U.  C.  (Q.  B.)  345. 

8  Barrett  v.  Jermy,  3  Wels.,  Hurl.  &  Gor.  (Exch.)  535. 

442 


CH.  XI.]      SPECIAL   PROVISIONS   OF   THE    CONTKACT,   ETC.         [§  221 

sioned  by  the  increase  of  risk,  unless  the  stipulation  be  that 
the  insurers  will  not  be  liable  for  any  loss  occasioned  by  an 
increase  of  risk.^  But  if  the  insured  have  two  policies  from 
the  same  office,  and  they  procure,  by  the  payment  of  an  addi- 
tional premium,  the  right  to  increase  the  risk  under  one, 
this  increase  will  not  vitiate  the  other  policy,  although  it 
be  also  an  increase  of  risk  to  the  property  in  that  policy 
insured.  2 

§  221.  Increase  of  Risk ;  Notice.  —  These  stipulations 
against  increase  of  risk  usually  avoid  the  contract  by  the 
mere  fact  of  the  change  which  causes  such  increase,  unless 
the  insurers  be  notified  of  such  change,  and  assent  thereto. 
And  where  notice  is  provided  for,  it  must  be  given  within 
reasonable  time,  if  no  time  be  specified.*  But  there  is 
oftentimes  added  another  clause,  which  leaves  it  optional 
with  the  company,  after  receiving  knowledge  of  the  change 
in  the  risk,  whether  to  cancel  the  policy  or  not.  This  was 
the  case  in  Allen  v.  Massasoit  Insurance  Company,^  where 

1  HHoflfecker  v.  N.  C.  C.  M.  Ins.  Co.,  5  Hous.  (Del.)  101.  Puttingin  an  addi- 
tional stove,  by  increasing  the  risk  where  naphtha  is  used  in  the  business,  may- 
avoid  the  policy  permitting  the  use  of  one  stove,  although  the  fire  did  not  arise 
from  the  new  stove.     Daniels  v.  Equitable  Fire  Ins.  Co.,  48  Conn.  105.] 

2  Gardiner  v.  Piscataquis  Mut.  Fire  Ins.  Co.,  38  Me.  439  ;  Merriam  v.  Middle- 
sex Mut.  Fire  Ins.  Co.,  21  Pick.  (Mass.)  162. 

3  Nortli  Berwick  Co.  v.  N.  E.  Fire  &  Mar.  Ins.  Co.,  52  Me.  336. 
*  Pim  V.  Reid,  6  M.  &  G.  1  ;  mite,  §  216 ;  post,  §  225. 

5  99  Mass.  160,  161.  The  court  here  said:  "There  are  two  clauses  in  the 
policy  which  refer  to  such  a  state  of  facts.  The  first  declares  that  '  if  the  situ- 
ation or  circumstances  affecting  the  risk  thereupon  '  shall  be  so  altered  or  changed 
by  or  with  the  advice,  agency,  or  consent  of  the  assured  as  to  increase  the  risk 
thereupon,  '  the  risk  thereupon  shall  cease  and  determine,  and  the  policy  become 
null  and  void,  unless  confirmed,' &c.  The  second  clause  is  as  follows:  'If, 
during  the  insurance,  the  risk  be  increased  by  the  erection  of  buildings,  or  by  the 
u.se  or  occupation  of  neighboring  premises  or  otherwise,  or  if  the  company  shall 
so  elect,  it  shall  be  optional  with  the  company  to  terminate  the  insurance  after 
notice  given  to  the  assured  or  his  representative  of  their  intentions  to  do  so,  in 
which  case  the  company  will  refund  a  ratable  portion  of  the  premium.'  The  two 
clauses  were  directed  to  two  objects  :  the  first,  to  whatever  should  increase  the 
risk  by  the  consent  or  agency  of  the  assured  ;  and  the  second,  to  whatever  should 
increase  the  risk  without  his  consent  by  the  agency  of  others.  The  first  it  was 
intended  to  guard  against  absolutely,  it  being  within  the  power  of  the  assured  to 
prevent ;  the  latter,  which  miglit  occur  without  his  act,  or  even  without  his 
knowledge,  it  was  just  should  not  affect  his  rights  without  notice.  The  mention 
of  the  erection  of  buildings  was  merely  the  specification  of  one  mode  in  which  the 

443 


§2211  IXSURAXCE  :    FIEE,    LIFE,   ACCIDENT,   ETC.  [CH.  XI. 

the  court  takes  occasion  to  refer  to  these  respective  provi- 
sions, and  to  state  their  scope  and  purpose.  On  the  other 
hand,  it  is  held  in  Wisconsin  that  where,  as  in  case  a  house 
becomes  vacant,  the  policy  is  to  be  void  unless  immediate 
notice  is  given,  and  the  vacancy  occurs  with  the  knowledge 
of  the  insurers,  and  the  insurers  also  have  the  right  to  ter- 
minate a  risk,  on  notice,  for  any  cause,  they  will  be  deemed 
to  have  waived  the  forfeiture  if  they  do  not  give  the  notice 
to  terminate.^ 

Notice  of  change  of  risk  must  be  within  reasonable  time.- 
And  where  one  change  of  risk  is  notified  and  assented  to  by 
the  insurer,  another  change  to  a  business  of  the  same  grade 
of  risks  will  be  presumed  to  be  assented  to,  and  though  not 
notified,  will  not  avoid  the  policy. ^  [Where  the  insured  is 
to  give  notice  of  any  increase  of  risk  within  his  knowledge, 
and  adjacent  buildings  were  erected,  the  jury  were  instructed 
that  if  they  thought  the  risk  was  materially  increased,  and 
no  notice  was  given,  the  plaintiff  could  not  recover,  and  it 
was  held  in  the  court  above,  that  this  was  sufficiently  favor- 
able to  the  company,  and  perhaps  ])ut  too  great  a  burden  on 
the  insured  to  require  him  to  take  notice  of  the  buildings, 
or  assume  his  knowledge  of  them.'*  When  the  provision  is, 
that  notice  must  be  given  if  a  change  is  made  that  will  in- 
crease the  risk  "so  as  to  increase  the  rate  of  insurance,"  the 
company  must  show  not  only  that  the  insured  knew  that  the 
change  would  increase  the  risk,  but  would  raise  the  rate  of 
insurance.°  When  an  increase  of  risk  by  adjacent  buildings 
is  to  be  notified  to  the  company,  a  failure  to  give  notice  of 

risk  might  be  increased  ;  and  appears  to  have  been  given  by  way  of  illustration. 
But  the  previous  provision  was  general,  and  included  aU  modes  in  which  the  risk 
should  be  increased  by  the  agency  of  the  insured."  See  Williams  v.  People's 
Fire  Ins.  Co.,  57  N.  Y.  274;  Breuner  v.  Liverpool,  &c.  Ins.  Co.,  51  Cal.  101. 
See  also  Commercial  Ins.  Co.  v.  Mehlman,  48  111.  31 3. 

^  Wakefield  v.  Orient  Ins.  Co.  (Wis.),  11  Reptr.  655.  See  also  Lomas  v. 
British  Am.  Ass.  Co.,  22  U.  C.  (Q.  B.)  310.  But  see  WiUiams  v.  People's  Ins. 
Co.,  supra. 

2  Canada  Credit  Co.  v.  Canada  Farmers'  Mut.  Ins.  Co.,  17  C.  C.  (Ch.)  418. 

3  Campbell  i-.  Liv.  &  Lon.  Fire  Ins.  Co.,  18  L.  C.  Jur.  (Q.  B.)  309,  reversing 
6.  c.  11  L.  C.  Jur.  66. 

*  [Franklin  Fire  Ins.  Co.  v.  Graver,  100  Pa.  St.  266,  274.] 

6  [Lebanon  ilut.  Ins.  Co.  v.  Losch,  109  Pa.  St.   100  (adjacent  building).] 

444 


CH.  XI.]      SPECIAL   PROVISIONS   OF   THE    COyTEACT,    ETC.        [§  222 

the  erection  of  a  "warehouse  forty-one  feet  from  the  insured 
building  is  fatal. ^  If  the  policy  requires  the  insured  to  give 
notice  of  any  change  in  the  neighboring  premises,  or  in  the 
use  of  the  insured  premises,  which  increase  the  risk,  only 
changes  known  by  him  to  increase  the  risk  are  meant-  If 
the  insured  gives  the  company  notice  of  a  change  of  risk,  it 
is  bound  to  make  its  election  whether  to  avoid  the  'policy  or 
not.  and  it  must  make  its  decision  known  within  a  reason- 
able tirae:^  When  the  change  made  in  the  insured  premises 
does  not  increase  the  risk,  no  notice  thereof  is  necessary  to 
the  company,  under  a  policy  providing  that  any  change  of 
risk  must  be  made  known  to  the  company.^  In  the  absence 
of  known  restrictions  an  agent  may  waive  written  assent  to 
material  alterations  in  the  property.'^] 

§  222.  Increase  of  Risk  :  Alteration.  —  An  almost  univer- 
sal provision  of  the  policy  is  one  intended  to  guard  against 
the  danger  of  increase  of  risk  by  alteration :  and  increase  of 
risk  by  alteration  may  avoid  a  policy  though  the  policy  con- 
tain no  provisions  to  that  effect.  This  alteration  may  take 
place  in  the  building  insured,  or  in  its  mode  of  use  or  occu- 
pation, or  in  its  situation  with  reference  to  other  buildings, 
or  in  any  other  circumstance  tending  to  change  the  charac- 
ter of  the  risk.  But  not  every  alteration  will  avoid  the  pol- 
icy, as  not  every  alteration  increases  the  risk.(c7)    In  marine 

1  [Peoria  Sug.  EefiningCo.  r.  People's  Fire  Ins.  Co.,  24  Fed.  Rep.  773  (Conn.), 
1SS5.] 

2  [Rife  f.  Lebanon  Miit.  Ins.  Co.,  115  Pa,  St.  531.] 

«  [Lattonius  v.  Farmers'  Mut.  Fire  Ins.  Co.,  3  Houst.  (Del.)  404,  420.] 

*  [Parker  v.  Arctic  Ins.  Co.,  59  X.  Y.  1,  4  ] 

5  [Paetard  r.  Dorchester  Mut.  Fire  Ins.  Co.,  77  Me.  144.] 

(a)  An  addition  or  extension  to  an  in-  Forhes  v.  American  Ins.  Co.,  164  Mass. 

sured  building  does  not  of  itself  operate  402  ;   Benton  v.  Farmers'  Mut.  F.  Ins. 

to  increase  the  risk,  for  improvements  Co.,  102  Mich.  2S1 :  Xappanee  Furniture 

made  to  the  building  in  connection  with  Co.  r.  Tern  on  Ins.  Co.,  10  Ind.  App. 

the   extension  may  decrease  the  risk.  319 ;    Gross  r.  Milwaukee   Mechanics' 

Meyer  r.  Queen  Ins.  Co.,  41  La.  An.  Ins.  Co.,  92  Wis.  656;   Franklin  Brass 

1000.     See  Franklin  F.  Ins.  Co.  i-.  Hel-  Co.  v.  Phcenix  Ass.  Co.,  65  Fed.  Rep. 

lerick  (Ky.),   49  S.  W.   1066.     As  to  773;  Davis  r.  "VTestern  Home  Ins.  Co., 

such  additions  and  extensions,  and  the  81  Iowa,  496 ;  Carpenter  r.  Allemannia 

goods  therein  being  covered  by  the  po-  F.  Ins.  Co.,  156  Penn.  St,  37. 
licy  upon   the    original    building,   see 

445 


§  222]  INSURANCE  :     FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  XI. 

insurance,  a  deviation  from  the  voyage  is  held  to  avoid  the 
policy;  but  this  has  been  said  to  be  not  on  the  ground  of  an 
increase  of  the  risk,  but  on  the  ground  that  the  insured  has 
voluntarily  substituted  another  voyage  for  the  one  insured, 
and  the  change  of  the  voyage  determines  the  contract  from 
the  time  it  happens. ^  The  same  strictness,  however,  is  not 
observed  in  fire  insurance.  It  would  seem,  at  the  first 
glance,  that  the  enlargement  of  a  building,  already  contigu- 
ous to  a  building  on  one  side,  so  that  it  should  be  contiguous 
on  two  sides,  must  necessarily  increase  the  risk,  the  points 
of  contact  having  been  increased.  And  so  it  has  been  con- 
tended, in  analogy  to  the  doctrine  of  marine  insurance,  that 
a  deviation  avoids  the  policy  without  reference  to  an  in- 
crease of  the  risk.  But  it  is  to  be  considered  that,  while  by 
deviation  the  identity  of  the  voyage  insured  is  changed,  a 
building  may  be  altered,  repaired,  or  enlarged  without  sub- 
stantially affecting  its  identity,  either  as  a  structure  or  as  a 
subject-matter  of  insurance.  It  may  still  remain  the  same, 
or  so  nearly  so  that  the  increase  of  risk  is  inappreciable. 
Indeed,  it  may  be  that  there  is  no  increase  at  all,  and  pos- 
sibly even  a  diminution.  The  substitution  of  a  slated  for  a 
shingled  roof,  for  instance,  even  though,  in  the  change,  the 
area  of  the  roof  should  be  somewhat  enlarged,  it  is  obvious, 
would  not  increase  the  risk,  though  it  would  undoubtedly 
be  an  alteration.  So  the  extension  of  a  wooden  building 
towards  and  nearer  to  an  adjacent  building  might  increase 
the  risk,  but  a  substitution  for  wood  of  brick,  stone,  slate, 
or  some  other  substance  less  combustible  than  wood,  at  the 
point  of  nearest  proximity,  might  more  than  counterbalance 
the  increase  of  risk  from  the  extension.  Whether  the  alter- 
ation, therefore,  in  any  particular  case  will  avoid  the  policy, 
depends  as  a  general  rule  upon  its  materiality,  and  this  again 
is  determined  by  the  question  whether  it  increases  the  risk, 2 
—  a  question  of  fact  to  be  determined  by  the  jury  upon  all 

1  Burgess  v.  Equitable  Mar.  Ins.  Co.,  126  Mass.  70,  79. 

2  [A  mere  change  or  alteration  in  the  insured  buildings  which  does  not  in- 
crease the  risk  will  not  avoid  the  policy.  Lattomus  v.  Farmers'  Mut.  Fire  Ins. 
Co.,  3  Houst.  (Del.)  404,  420.] 

446 


CH.  XI.]     SPECIAL    PROVISIONS    OF   THE    CONTRACT,   ETC.        [§  223 

the  circumstances  of  each  particular  case.^  Pardessus  is  of 
the  opinion  that  the  rule  as  to  the  effect  of  a  deviation  at 
sea  would  not  be  so  strictly  applied  to  a  transit  by  land ;  but 
that  in  the  latter  case  the  deviation  would  not  avoid  the  pol- 
icy, if  the  insured,  after  deviation,  should  return  to  the  route 
indicated  in  the  policy.^  So,  if  a  building  or  property  in- 
sured be  removed  from  the  place  where  it  was  when  insured, 
though  it  would  not  be  covered  by  the  policy  while  away  or 
located  in  another  place,  yet  a  restoration  of  the  property 
insured  will  restore  it  to  the  protection  of  the  policy. ^  [But 
where  the  goeds  are  described  as  on  the  first  floor,  and  in 
the  basement,  a  removal  of  all  of  them  to  the  basement  is 
not  an  increase  of  risk.*] 

§  223.  Alteration ;  Materiality ;  "Warranty.  —  Of  the  ele- 
ments to  be  considered  in  determining  the  question  of  the 
materiality  of  an  alteration,  one  of  prime  importance  is, 
whether  the  alteration  be  such  that  had  the  insurance  been 
sought  on  the  building,  as  altered,  a  higher  rate  of  insur- 
ance would  have  been  demanded  than  was  demanded  on  the 
building  as  actually  insured.^  And  if  such  be  the  fact,  then 
it  would  be  of  no  avail  to  show  in  an  action  for  a  loss  that 
it  was  not  occasioned  by  the  alteration,  nor,  on  the  other 
hand,  would  it  be  incumbent  on  the  insurers  to  show  that  it 
was  occasioned  by  the  alteration.  In  other  words,  the  ques- 
tion of  materiality  does  not  necessarily  depend  upon  the  fact 
whether  the  loss  is,  or  is  not,  occasioned  by  the  alteration.^ 
The  question  of  the  materiality  of  an  alteration  or  change 
may,  however,  by  express  stipulation,  be  taken  out  of  the 

1  Curry  v.  The  Commonwealth  Ins.  Co.,  10  Pick.  (Mass.)  53.5  ;  Lavabre  v. 
Wilson,  Doug.  284  ;  Jolly  v.  Bait.  Eq.  Soc,  1  H.  &  G.  (Md.)  295  ;  Stetson  v. 
Massacliusetts  Mut.  Fire  Ins.  Co.,  4  Mass.  330.     And  see  post,  §  224. 

2  Cours  de  Droit  Com.  §  596,  par.  3. 

3  Ante,  §  101  ;  post,  §  381  ;  Boynton  v.  Clinton  &  Essex  Mut.  Ins.  Co.,  16 
Barb.  (N.  Y.)  254;  Annapolis  v.  Baltimore  Fire  Ins.  Co.,  32  Md.  37;  Spitzer  v. 
St.  Mark's  Ins.  Co.,  6  Duer  (X.  Y.  Superior  Ct.),  6. 

*  [Plinsky  v.  Germania  Fire  &  Mar.  Ins.  Co.,  32  Fed.  Rep.  47  (Mich.),  1887.] 

5  [The  rates  of  insurance  charged  on  burr  flouring  mills  and  roller  mills  is 
competent  in  deciding  whether  the  risk  was  increased  by  changing  the  machin- 
ery from  the  burr  to  the  roller  process.  Planters'  Mut.  Ins.  Co.  v.  Rowland, 
66  Md.   236.] 

6  Merriam  v.  The  Middlesex  Mut.  Fire  Ins.  Co.,  21  Pick.  (Mass.)  162. 

447 


§  224]  INSURANCE  :   FIRE,  LIFE,   ACCIDENT,   ETC.  [CH.  XL 

field  of  debate.  It  is  competent  for  the  parties  to  agree  that 
this  or  that  alteration  or  change  shall  work  a  forfeiture,  in 
which  case  the  only  inquiry  will  be  whether  the  one  in  ques- 
tion comes  within  the  category  of  changes  which  by  agree- 
ment shall  work  a  forfeiture.  Thus,  where  in  a  policy  of 
insurance  there  is  a  memorandum  of  hazardous  trades,  and 
it  is  stipulated  that  none  of  these  trades  shall,  during  the 
curi*ency  of  the  policy  be  carried  on  in  the  building  insured 
upon  penalty  of  forfeiting  the  right  to  recover  in  case  of  loss, 
the  use  of  the  building  for  such  a  trade  will  avoid  the  policy ; 
and  evidence  to  show  that  the  actual  use  did  not  increase 
the  risk  of  damage  by  fire  will  be  inadmissible,  and  this 
although  the  policy  covered  one  of  the  specially  hazardous 
risks.  ^  So  if  the  change  is  to  a  business  which  is  in  the 
policy  denominated  specially  hazardous,  and  increase  of  risk 
not  notified  is  to  avoid  the  policy,  the  increase  of  risk  is 
conclusively  presumed.  ^  But  even  in  case  where  the  stipu- 
lation with  reference  to  alteration  is  a  warranty,  want  of 
literal  and  exact  fulfilment  as  to  minute  matters,  im- 
material to  the  risk,  will  not  avoid  the  policy.  The 
jury  will  consider  whether  the  warranty  is  substantially 
observed.^ 

§  224.  What  Extent  of  Alteration  permissible  when  not  in- 
hibited ;  Repairs.  —  Unless  there  be  a  special  stipulation  to 
the  contrary,  when  a  building  is  insured,  the  insured  does 
not  relinquish  the  right  of  exercising  the  ordinary  and  neces- 
sary rights  of  ownership  over  the  same,  and  may  not  only 
make  ordinary,  but  such  general  repairs  and  changes  as  may 
be  necessary  or  convenient  to  make  the  building  better  sub- 
serve its  purposes,  according  to  the  mode  customary  in  such 


1  Lee  V.  Howard  Fire  Ins.  Co.,  3  Gray  (Mass.),  583;  Glen  v.  Lewis,  8  Wels., 
Hurl.  &  Gor.  (Exch.)  607. 

2  Gasner  v.  Met.  Ins.  Co.,  13  Minn.  483. 

3  Girard  Fire  &  Mar.  Ins.  Co.  v.  Stephenson,  37  Pa.  St.  293.  In  a  recent  case 
it  was  left  to  the  jury  to  say  whether  sinking  an  artesian  well  whence  gas  escaped, 
and  coining  in  contact  with  a  jet  of  flame  causing  the  fire,  materially  increased 
the  risk,  with  the  instruction  that  such  an  alteration  was  not  permitted  as 
incidental  to  the  business.  Crane  v.  City  Ins.  Co.,  C.  Ct.  Ohio,  1880,  3  Fed. 
Rep.  558. 

448 


CH.  XI.]      SrECIAL    PROVISIONS    OF    THE    CONTRACT,    ETC.        [§  224 

cases  ;i  but  not  alterations  materially  enhancing  the  risk,^ 
and  not  necessary  to  the  enjoyment  of  the  premises,  or 
according  to  usage,  and  not  the  result  of  the  exercise  of 
such  ordinary  acts  of  ownership  as  may  fairly  be  presumed 
to  have  entered  into  the  contemplation  of  the  parties  at  the 
time  when  the  insurance  was  effected.  "In  effect,"  said 
Willes,  J.,  in  Thompson  v.  Hopper,^  "there  being  no  viola- 
tion of  the  law  and  no  fraud  of  the  assured,  an  increase  of 
risk  to  the  subject-matter  of  insurance,  its  identity  remain- 
ing, though  such  increase  of  risk  be  caused  by  the  insured, 
if  it  be  not  prohibited  by  the  policy,  does  not  avoid  the  in- 
surance." In  other  words,  the  insured,  unless  restricted  in 
some  way  in  the  policy,  may  use,  protect,  and  enjoy  his 
property  as  such  property  is  customarily  used,  enjoyed,  and 
protected ;  and  in  any  case  of  dispute  the  question  will  be 
for  the  jury  whether  the  insured  has  transcended  a  fair  ex- 
ercise of  his  rights.^  The  only  restraints  in  such  a  case 
arise  from  necessary  implication  founded  on  the  presumed 
intentions  of  the  parties,  and  are  such  as  are  called  for  by 
the  dictates  of  reason,  justice,  and  public  policy.  The  in- 
surer must  be  presumed  to  know  that  the  owner  intends  to 
derive  benefit  from  the  use  and  occupancy  of  his  buildings, 
and  to  that  end  he  must  keep  them  in  tenantable  condition. 
And  to  put  them  in  tenantable  condition  prudence  may  re- 
quire that,  in  order  to  enable  him  to  reap  the  greatest  bene- 
fit from  his  property,  he  shall  do  something  more  than  make 
his  building  barely  inhabitable.  Having  regard  to  its  ap- 
pearance and  convenience  as  compared  with  other  property 
of  a  similar  character  in  the  vicinity,  he  may  make  such 
repairs  and  alterations  as  will  make  it,  relatively  to  other 
property  with  which  it  may  come  in  competition,  equally 
attractive,  desirable,  and  convenient.      The  contract  of  in- 

1  [The  phrase  *'  increase  of  risk  "  means  an  essential  increase  thereof,  and  does 
not  include  every  slight  addition  to  the  risk,  as  by  repairs  incidental  to  the  busi- 
ness.    Crane  v.  City  Ins.  Co.,  2  Flippin,  576,  580.] 

2  [Unless  restricted  by  the  policy  the  insured  may  make  any  alterations  that 
do  not  increase  the  risk.     Planters'  Mutual  Ins.  Co.  v.  Rowland,  QQ  Md.  236.] 

8  E.,  B.  &  E.  10.38,  1049. 

*  Jolly  V.  Bait.  Eq.  Soc,  1  H.  &  G.  (Md.)  295. 

VOL.  I.  — 29  449 


§  224]  INSUKANCE  :   FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  XI. 

surance  is  not  to  be  construed  so  as  to  restrain  the  prudent 
and  thrift}'  from  improving  their  property  and  their  income 
within  the  limits  of  ordinary  usage.  In  the  case  last  cited, 
where  the  repairs  were  of  a  thorough  and  extensive  charac- 
ter, so  much  so  that  the  house  was  given  up  to  the  posses- 
sion of  the  m.echanics  engaged  therein  for  several  weeks, 
and  was  meantime,  as  is  usual  in  such  cases,  incumbered 
with  the  materials,  and  strewn  with  the  chips  and  other 
waste  incident  to  such  repairs,  it  was  contended  by  the  dis- 
tinguished counsel  1  for  the  defendants  that  such  repairs 
avoided  the  policy,  and  they  likened  the  case  to  a  deviation 
in  marine  assurance ;  and  so  it  was  ruled  at  the  trial.  But 
on  appeal  the  court  sent  back  the  case  for  a  new  trial,  giv- 
ing a  very  elaborate  opinion,  from  which  we  make  the  ex- 
tract quoted  in  the  note.^     So  it  was  said  in   Robinson  v. 

1  Wirt  and  Taney. 

2  "The  strictness  and  nicety  which  have  been  wisely  adopted  in  the  trial  of 
questions  arising  on  policies  of  marine  insurance  are  not,  to  their  full  extent, 
applicable  to  the  policies  of  this  society.  The  former  are  entered  into  by  the 
assurer  almost  exclusively  on  the  statements  and  information  given  by  the  assured 
himself ;  in  the  latter  case  the  insurers  assume  the  risk  on  the  knowledge  ac- 
quired by  an  actual  survey  and  examination  made  by  themselves,  not  on  repre- 
sentations coming  from  the  insured.  This  association,  therefore,  formed  for  their 
individual  accommodation  and  security,  cannot,  upon  any  sound  principle  of 
construction,  be  viewed  as  involving  in  it  a  mutual  relinquishment  of  the  right 
of  exercising  those  ordinary  necessary  acts  of  ownership  over  their  houses  which 
have  been  usually  exercised  by  the  owners  of  such  property.  It  hence  follows 
that  the  insured  is  authorized  to  make  any  necessary  repairs  in  the  mode  com- 
monly pursued  on  such  occasions. 

"But  if,  by  the  gross  negligence  or  misconduct  of  the  workmen  employed,  a 
loss  by  fire  ensue ;  or  if  alterations  be  made  in  the  subject  insured  materially  en- 
hancing the  risk,  and  not  necessary  to  the  enjoyment  of  the  jii'emises  insured,  or 
according  to  usage  and  custom  were  not  the  result  of  the  exercise  of  such  ordinary 
acts  of  ownership  as  in  the  understanding  of  the  parties  were  conceded  to  the 
insured  at  the  time  of  insurance,  and  a  loss  by  fire  is  thereby  produced,  —  then 
are  the  underwriters  released  from  all  reliability  to  indemnify  for  such  loss.  The 
policy  of  insurance  here  being  perfectly  silent  on  the  subject,  and  no  general  prin- 
ciple or  rule  of  law  having  been  established,  in  cases  like  the  present,  by  which 
to  determine  whether  the  repairs  or  alterations  were  such  as  the  insured  had 
autliority  to  make  as  being  necessary  to  the  user  of  the  property,  and  whether,  if 
authorized,  they  were  made  in  the  usual  and  customary  way,  the  proper  tribunal 
to  decide  those  questions  is  the  jury  and  not  the  court. 

"  It  appears  to  have  been  conceded  in  argument  that  ordinary  necessary  repairs 
might  be  made  by  the  insured,  but  not  a  thorough  repair  like  the  present.  The 
proof  of  the  appellants  is  '  that  the  repairs  made  on  this  house  were  necessary  for 
the  purpose  of  rendering  it  tenantable,'  and  that  they  were  made  in  the  usual 

450 


CH.  XI.]      SPECIAL    PUOVISIOXS    OF   THE    CONTKACT,    ETC.        [§  224 

Mercer  County  Mutual  Fire  Insurance  Company,  ^  with  ref- 

way.  The  bill  of  exceptions  shows  that  by  the  word  '  repairs '  both  parties  meant 
all  that  was  done  to  tlie  house.  The  distinction  attempted  to  be  taken  has  not 
been  supported  by  any  authorities,  and  in  common  sense  and  justice  there  can  be 
no  discrimination  between  the  right  to  make  ordinary  repairs  and  such  a  thorough 
repair  as  is  necessary  for  tlie  purpose  of  rendering  the  house  tenaiitable. 

"It  has  been  stated  by  the  counsel  of  both  parties  that  there  can  be  found  in 
the  books  no  adjudication  on  a  policy  against  fire  analogous  to  the  present.  It 
becomes  this  court,  then,  maturely  to  deliberate  before  they  sanction  the  doctrine 
contended  for  by  the  appellees,  wliich,  contrary  to  justice  and  the  understanding 
and  intention  of  the  parties  at  the  formation  of  their  contract,  annihilates  all 
claim  to  indemnity  on  the  part  of  the  insured,  and  yet  leaves  the  insurer  in  the 
full  enjoyment  of  the  premium  for  responsibility.  It  perhaps  scarcely  ever  hap- 
pens that  during  the  period  of  seven  years,  the  usual  term  to  which  such  policies 
are  limited,  some  trifling  alteration  or  addition  is  not  made  to  the  property  in- 
sured ;  as  a  new  door  or  window  opened,  an  additional  closet,  shelf,  or  such  like 
fixture  erected :  any  of  which  acts,  if  the  grounds  assumed  by  the  appellees  are 
supported,  change  the  identity  of  the  property,  create  a  new  risk,  and  absolve  the 
underwriters.  Indeed,  if  alterations  and  additions  are,  per  se,  a  change  of  the  risk, 
it  would  follow  that  the  erection  of  a  parapet  wall  in  a  city,  a  substitution  of  brick 
for  a  wooden  floor,  or  a  marble  for  a  wooden  mantel-piece,  or  the  introduction  of 
a  coal-grate  in  a  chimney  constructed  for  wood  as  the  only  fuel,  though  lessening 
the  peril,  would  discharge  the  policy  ;  as,  according  to  the  principles  of  maritime 
insurance,  every  change  of  the  risk  exonerates  the  underwriter,  whether  the  dan- 
ger be  increased  or  diminished,  or  happen  the  loss  from  whatsoever  cause  it  may. 
To  infer,  without  any  express  provision  or  necessary  implication  arising  out  of  the 
contract  itself,  or  pulilic  policy  demanding  it,  that  the  insured  surrendered  all 
right  to  make  such  commonplace,  trivial,  unimportant  additions  to  and  alterations 
of  his  property,  as  its  safety  or  his  convenience  or  comfort  might  suggest,  is  a 
construction  too  rigorous  to  be  rational ;  the  effect  of  which  would  be  to  render 
worse  than  useless  those  most  useful  and  indispensable  institutions  in  populous 
cities,  —  fire  insurance  companies,  —  and  give  a  fatal  stab  to  our  enterprising 
manufacturers,  who,  if  suing  for  a  loss  under  a  policy  covering  the  manufactory 
and  machinery,  would  be  turned  out  of  court  without  remedy  or  hope,  if  per- 
chance the  insurer  could  prove  that  the  most  immaterial  alteration  or  improve- 
ment were  made  in  his  machinery,  by  substituting  the  power  of  the  screw  for  that 
of  the  lever,the  leather  strap  for  the  iron  wheel,  or  the  iron  for  the  wooden  shaft. 
But  suppose  all  the  rules  of  marine  insurance  applicable  to  the  question  at  bar, 
can  a  case  be  found  in  which  it  was  ever  contended  that  to  add  to  the  equipment 
of  a  vessel  insured  a  yard  or  more  of  canvas,  or  an  additional  cleat  or  clew-line, 
was  to  vacate  the  insurance  ? 

"The  numerous  and  warmly  litigated  questions  of  deviation  and  change  of 
risk,  which  burden  the  records  of  courts  of  justice,  bear  no  analogy  to  that  now 
under  considea-ation.  There,  departing  from  the  course  of  the  voyage,  or  perform- 
ing it  at  any  other  time  than  that  required  by  the  policy,  subjects  the  vessel  to 
diff"erent  perils  than  those  contemplated  by  the  contracting  parties  ;  a  flaw,  a 
whirlpool,  a  breaker  may  be  encountered  in  one  course  of  the  voyage  which  would 
be  a  cause  of  neither  danger  nor  alarm  at  a  mile's  distance.  The  tempests  or 
casualties  attending  the  performance  of  a  voyage  to-day  bear  no  similitude  or  pro- 


1  3  Dutch.  (N.  J.)  134, 

451 


§  225]  INSURANCE  :    FIRE,   LIFE,    ACCIDENT,   ETC.  [CH.  XI. 

erence  to  a  change  of  use  from  one  business  to  another  of 
greater  risk,  that  if  the  insured  exposed  the  property  to  a 
risk  far  more  hazardous  than  could  have  been  contemplated 
by  the  insurers,  good  faith  required  that  they  should  have 
notice,  and  if  the  insured  neglected  to  notify  them  it  would 
amount  to  that  gross  negligence  which  would  defeat  a  recovery. 
S  225.  Alteration  ;  Change  in  Surroundings ;  Enlargement. 
—  The  same  rules  are  applicable  to  changes  in  the  situation 
of  the  property  insured  relative  to  other  property,  and  other 
surrounding  and  incidental  circumstances  tending  to  in- 
crease the  risk.  If  the  policy  provide  for  notice  of  altera- 
tion or  change  in  risk,  on  penalty  of  forfeiture,  the  insured 
takes  the  risk  if  he  fails  to  give  notice  of  a  change  which 
increases  the  risk.  The  only  safe  course  for  the  applicant 
is  to  notify  of  all  changes.^  If  the  contract  be  silent  on  this 
point,  any  change  within  the  limits  of  fair  and  honest  deal- 
ing is  permissible,  even  though  to  that  change  the  destruc- 
tion of  the  property  may  be  due.^     [A  clause  allowing  neces- 

portion  to  those  attendant  on  a  like  voyage  to-morrow.  But  no  such  total  revolu- 
tion is  wrought  in  the  perils  to  a  house  insured  against  fire  which  has  undergone 
alterations  or  repairs  ;  it  remains  subject  to  the  same  perils,  although  their  degree 
may  be  increased  or  diminished.  It  becomes  a  question  of  increase,  not  oi change 
of  risk,  for  the  ascertainment  of  which  the  jury,  and  not  the  court,  is  the  proper 
tribunal."  For  further  illustration  of  the  doctrine  of  this  case,  see  Wash.  Ins.  Co. 
?\  Davison,  30  Md.  92,  107  ;  Franklin  Ins.  Co.  i;.  Chicago  Ice  Co.,  36  id.  102, 
121  ;  Grant  v.  Howard  Ins.  Co.,  5  Hill  (N.  Y.),  10;  Rann  v.  Home  Ins.  Co., 
59  N.  Y.  387  ;  and  especially  the  veiy  elaborate  case  of  James  v.  Lycoming  Fire 
Ins.  Co.,  4  Cliff.  C.  Ct.  (Mass.)  272.  See  also  Anderton  v.  Home  Ins.  Co.,  2  Ins. 
L.  J.  877  ;  Dorn  v.  Germania  Ins.  Co.,  C.  Ct.  (Ohio),  1  Law  &  Eq.  Reptr.  132, 
133.     And  see  also  ante,  §§  219,  223,  note  at  the  end,  and  post,  §  230. 

1  Pottsville  Mut.  Fire  Ins.  Co.  v.  Horan  (Pa.),  9  Ins.  L.  J.  201  ;  ante,  §§  216, 
221. 

2  Stebbins  v.  Globe  Ins.  Co.,  2  Hall  (N.  Y.  Superior  Ct.),  632  ;  Grant  v.  How- 
ard Ins.  Co.,  5  Hill  (N.  Y.),  10,  16  ;  Western  Farmers'  Mut.  Ins.  Co.  v.  Miller, 

1  Handy  (Cincinnati  Superior  Ct.),  325  ;  Gates  v.  Madison  County  Mut.  Ins. 
Co.,  1  Seld.  (N.  Y.)  469  ;  Young  v.  Washington  County  Mut.  Ins.  Co.,  14  Barb. 
(N.  Y.)  545.  In  Howard  v.  Kentucky  &  Louisville  Ins.  Co.,  13  B.  Mon.  (Ky.) 
282,  it  is  said  that  in  such  a  case  the  policy  will  not  be  avoided  unless  the  in- 
creased risk  is  the  cause  of  the  loss,  in  which  case  what  was  unobjectionable 
becomes  misconduct,  —  a  doctrine  which  cannot  be  said  to  be  in  accordance 
with  the  current  of  opinions,  nor  is  it  supported  by  Stebbins  v.  Globe   Ins.  Co., 

2  Hall  (N.  Y.  Superior  Ct.),  632,  the  only  case  cited  as  an  authority.  That  case 
says,  obiter,  that  if  the  increase  of  risk  be  fraudulent  and  occasion  the  loss,  it  may 
be  a  defence. 

452 


CH.  XI.]      SPECIAL   PROVISIONS   OF   THE   CONTRACT,   ETC.        [§  226 

sary  alterations  and  repairs  does  not  permit  an  addition  two 
hundred  feet  long  and  twelve  feet  wide,  and  parol  evidence 
that  such  an  enlargement  was  contemplated  by  the  parties 
at  the  time  of  insurance  is  not  admissible  to  vary  the  writ- 
ten contract.  1]  In  Joyce  v.  Maine  Insurance  Company,'^ 
there  was  the  peculiar  provision  that  if  the  risk  was  in- 
creased by  the  erection  of  buildings,  or  the  occupation  of 
neighboring  premises,  it  should  be  the  duty  of  the  insured 
to  give  immediate  notice  thereof  to  the  insurers,  that  they 
might  terminate  the  insurance  if  they  should  so  elect.  But 
no  penalty  for  neglect  to  give  notice  was  fixed.  Such  a  pro- 
vision was  held  to  afford  to  the  insurers  no  ground  of  de- 
fence, in  case  of  its  violation,  as  they  cannot  assume  that 
they  would  have  terminated  the  insurance  if  notice  of  the 
change  had  been  given.  And  in  point  of  fact  such  a  provi- 
sion seems  to  have  no  force,  the  insurers  having  no  better 
standing  in  court  than  they  would  have  without  it.  Under 
a  somewhat  similar  provision  in  a  policy  which  provides 
that  the  trustees  may  declare  it  null  and  void  if  the  insured 
premises  be  repaired  or  enlarged  so  as  to  render  the  risk 
greater,  the  notice  of  the  trustees  does  not  conclude  the  in- 
sured. He  may  yet  go  to  the  jury  on  the  question  whether 
the  enlargement  did  in  fact  increase  the  risk.^  If  any 
particular  act  is  to  be  done,  as,  for  instance,  if  a  build- 
ing contiguous  to  the  property  insured  is  to  be  removed, 
this  can  only  be  required  within  a  reasonable  time;  and 
if  a  loss  occur  before  the  removal,  it  is  for  the  jury  to 
say  whether  that  reasonable  time  had  elapsed  before  the 
loss.* 

§  226.  Increase  of  Risk  during  Alteration ;  Increase  and  De- 
crease. —  But  if  the  policy  provides  against  an  alteration  and 
enlargement  which  shall  increase  the  risk,  a  considerable 
and  deliberate  alteration  and  enlargement  not  incidental  to 
the  use  of  the  property  will  avoid  the  policy,  if  it  increases 

1  [Frost's  Detroit  Lumberworks  v.  Miller's  Mut.  Ins.  Co.,  37  Miun.  300.] 

2  45  Me.  168. 

8  Stetson  V.  ^Massachusetts  Mut.  Fire  Ins.  Co.,  4  Mass.  330. 
*  Liniisey  v.  Union  Mut.  Fire  Ins.  Co.,  3  R.  I.  157. 

453 


§  227]  INSURANCE  :   FIKE,   LIFE,   ACCIDENT,   ETC.  [CH.  XL 

the  risk  during  the  alteration;  and  whether  the  alteration  is 
sucli  a  one  is  for  the  jiny.  It  seems,  however,  that  ordinary 
repairs  under  such  circumstances  would  not. ^  In  Heneker 
V.  British  America  Assurance  Company,^  where  extensive 
alterations  were  made  both  in  the  building  itself  and  the 
surroundings,  the  court  refused  to  allow  the  jury  to  find  — 
there  being  an  actual  increase  of  risk  in  the  building  itself 
—  whether,  on  the  whole,  taking  into  consideration  any  de- 
crease of  risk  in  the  surroundings,  there  was  any  actual 
increase  of  risk.  But  in  Date  v.  Gore  District  Mutual  In- 
surance Company, 3  where  the  changes  were  all  within  the 
building,  some  calculated  to  increase  the  risk  and  others  to 
diminish  it,  the  court  allowed  the  jury  to  strike  the  balance, 
and  say  if,  on  the  whole,  there  was  any  increase. 

§  227.  Alteration  by  others  than  the  Insured.  —  Unless  the 
consequences  are  restricted  to  the  acts  of  particular  persons, 
an  alteration,  such  as  would  work  a  forfeiture  of  the  policy, 
if  made  by  the  insured,  is  equally  fatal  if  made  by  a  tenant 
without  the  knowledge  or  consent  of  the  insured.*  That  it 
is  made  by  a  tenant  is  no  excuse,  if  contrary  to  the  cove- 
nants in  the  policy.  The  tenant's  possession  is  the  land- 
lord's possession.  The  latter  continues  to  be  the  party 
insured,  and  the  covenants  which  he  enters  into  remain 
whether  he  occupies  personally  or  by  tenant.^  [And  here 
is  always  an  implied  promise  of  the  insured  not  to  increase 
the  risk,  and  if  the  tenants  so  alter  or  use  the  property  as  to 
increase  the  risk  of  injury  or  loss  by  fire,  the  company  is 

1  Lyman  v.  State  Mut.  Fire  Ins.  Co.,  14  Allen  (Mass.),  329. 

2  14  U.  C.  (C.  P.)  57.  So  it  was  held  in  Pottsville  Mut.  Fire  Ins.  Co.,  v. 
Horan  (Pa.),  9  Ins.  L.  J.  201  ;  Lomas  v.  British  Am.  Ass.  Co.,  22  U.  C.  (Q.  B.) 
310,  318. 

3  15  U.  C.  (C.  P.)  175. 

*  [Long  V.  Beeber,  106  Pa.  St.  466  ;  Steimnetz  v.  Franklin  Ins.  Co.,  6  Phila. 
21,  23  (keeping  gunpowder)  ;  Liverpool,  &c.  Ins.  Co.  v.  Gunther,  116  U.  S.  113 
(hazardous  means  of  light)  ;  Hawell  v.  Baltimore  Eq.  Soc,  16  Md.  377,  386-387 
(hazardous  occupation  of  tenant  without  assured's  knowledge).  If  one  who  occu- 
pies premises  by  permission  of  the  insured  violates  any  of  the  conditions  of  the 
policy,  the  effect  is  the  same  as  though  the  assured  had  himself  violated  them, 
although  he  may  be  ignorant  of  the  tenant's  conduct.  Liverpool,  &c.  Ins.  Co.  v. 
Gunther,  116  U.  S.  113,  128.] 

5  Diehl  V.  Adams  County  Mut.  Ins.  Co..  58  Pa.  St.  443. 

454 


CH.  XI.]      SPECIAL    PROVISIONS    OF   THE    CONTRACT,    ETC.        [§  228 

released,  and  the  origin  of  the  fire  is  an  immaterial  ques- 
tion. ^J  If  the  insured  desires  to  escape  so  large  a  responsi- 
bility, he  must  see  to  it  that  the  terras  of  the  policy  are  not 
so  broad  as  to  include  the  acts  of  third  persons.  If  he  do 
not  do  this,  he  will  find,  perhaps  when  it  is  too  late,  that  he 
has  agreed  to  be  responsible  for  the  acts  of  third  persons.^ 
And  upon  this  principle,  an  alteration  by  a  mortgagor,  after 
an  assignment  of  the  policy,  and  without  the  knowledge  of 
the  assignor,  avoids  the  policy.^  A  substantial  change  of 
use,  if  prohibited  on  penalty  of  forfeiture,  though  made  by 
a  tenant  or  agent  without  the  knowledge  of  the  owner,  the 
insured,  is  fatal,  unless,  as  is  the  case  in  some  policies,  he 
is  made  responsible  for  such  changes  only  as  he  permits.* 
[Or  the  policy  is  to  be  affected  only  by  respective  increase 
of  risk  by  means  within  the  control  of  the  assured.  Then 
mere  imprudence  or  negligence  of  either  the  assured  or  his 
agent  would  not  avoid  the  policy.^]  But  a  tenant  is  not  a 
proprietor  within  the  meaning  of  a  provision  against  altera- 
tions by  act  of  the  proprietor,  and  an  alteration  therefore 
by  a  tenant,  not  known  to  the  owner,  does  not  avoid  the 
policy.^ 

§  228.  Alteration;  Premises.  — "Premises"  means  build- 
ing, and  though  there  is  an  alteration  in  the  status  of  the 
property  insured  increasing  the  risk,  it  is  not  an  alteration 
in  the  "  premises  "  or  building  in  which  the  property  insured 
is  located,  and  therefore  works  no  forfeiture.'  But  a  provi- 
sion against  lighting  the  "  premises  "  insured,  in  a  policy  on 

1  [Hoffecker  r.  Xew  Castle,  &c.  Ins.  Co.,  5  Honst.  (Del.)  101.] 

2  Shepherd  r.  Union  Mut.  Fire  Ins.  Co.,  38  N.  H.  232. 

3  Kuntz  V.  Niagara  Dist.  Fire  Ins.  Co.,  16  U.  C.  (C.  P.)  573 ;  Grosvenor  v. 
Atlantic  :\Iut.  Ins.  Co.,  17  N.  Y.  391  ;  State  Mut.  Fire  Ins.  Co.  v.  Roberts,  31 
Pa.  St.  438  ;  Loring  v.  Manuf.  Ins.  Co.,  8  Gray  (Mass.),  28. 

*  Fire  Assoc,  of  Philadelphia  v.  Williamson,  26  Pa.  St.  196  ;  Howell  v.  Bait. 
Eq.  Soc,  16  Md.  317  ;  Appleby  v.  Fireman's  Fund  Ins.  Co.,  45  Barb.  (X.  Y. ) 
454  ;  Sanford  v.  Mechanics'  Mut.  Fire  Ins.  Co.,  12  Cush.  (Mass.)  541.  But  see 
post,  §  240. 

s  [Gnnther  v.  Liv.,  Lond.  &  Globe  Ins.  Co.,  20  Blatch.  362,  367.] 

6  Padelford  r.  Prov.  Mut.  Fire  Ins.  Co.,  3  R.  I.  102. 

^  Robinson  v.  Mercer  County  Mut.  Ins.  Co.,  3  Dutch.  (X.  J.)  134,  135  ;  Leg- 
gett  V.  .Etna  Ins.  Co.,  10  Rich.  Law  (S.  C),  202  ;  post,  §§  243,  239  B.  And  see 
also  Howard  Fire  &  Mar.  Ins.  Co.  v.  Cornick,  24  111.  455. 

455 


§  230]  INSUKANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  XI. 

a  stock  of  goods,  refers  to  lighting  the  building  as  well  as 
the  merchandise.^ 

§  229.  Alterations  at  Risk  of  the  Insured.  —  A  provision 
that  alterations  and  repairs  are  at  the  risk  of  the  insured 
has  been  said  to  mean,  not  that  they  shall  necessarily  avoid 
the  contract,  but  that  the  assured  shall  assume  the  hazard 
of  their  increasing  the  liability  of  the  insurer. 2  But  in 
Kingsley  v.  New  England  Mutual  Insurance  Company, ^  a 
condition  that  the  insured  should  "take  all  risk  from  cotton 
waste,"  was  held  to  mean  that  if  the  fire  originated  in  cotton 
waste  the  insurers  were  not  to  be  responsible. 

§  230-  Alteration  in  Mode  of  Use.  —  Under  a  policy  in- 
suring in  general  terms  a  store,  building,  or  factory,  with- 
out restriction  as  to  the  use  or  as  to  the  kind  of  goods  to  be 
kept,  or  as  to  increase  of  risk  generally,  any  kind  of  goods 
may  be  kept,  and  any  kind  of  business  carried  on,  and  any 
change  of  circumstances  made,  not  expressly  prohibited, 
within  the  limits  of  good  faith  and  fair  dealing;  and  the 
fair  inference,  from  the  fact  that  certain  kinds  of  goods  and 
certain  kinds  of  business  are  classed  as  hazardous,  is,  that 
all  others  are  within  the  scope  of  the  policy. *  And  in  the 
absence  of  fraud,  it  is  immaterial  whether  the  newly  intro- 
duced property,  trade,  or  business  is  more  or  less  hazardous. 
Subject  only  to  the  restraints  of  honesty  and  fair  dealing, 
the  insured  may  use  his  property  as  he  sees  fit,  and  has 
towards  the  insurers  no  obligations  not  set  down  in  the  con- 

1  Stettiner  v.  Granite  Ins.  Co.,  5  Dner  (N.  Y.  Superior  Ct.),  584.  In  Trench 
v.  Chenango  County  Mut.  Ins.  Co.,  7  Hili  (N.Y.),  122,  it  was  held  that  where 
buildings  and  personal  property  weie  insured  in  the  same  policy,  and  there  was 
a  breach  of  warranty  in  the  failure  to  state  all  the  buildings  within  a  certain  dis- 
tance, the  breach  avoided  the  policy  only  as  to  the  bnilding,  and  that  as  to  the 
personal  property  there  might  be  a  recovery  therefor.  But  this  doctrine  was 
doubted  in  Sexton  v.  Montgomery  County  Mut.  Ins.  Co.,  9  Barb.  (N.  Y.)  191, 
repudiated  in  Kennedy  v.  St.  Lawrence  County  Mut.  Ins.  Co.,  10  Barb.  (N.  Y.) 
285,  and  tlie  case  itself,  upon  this  point  overruled  in  Wilson  v.  Herkimer  County 
Mut.  Ins.  Co.,  2  Seld.  (N.  Y. )  53. 

2  Girard  Fire  &  Mar.  Ins.  Co.  i-.  Stephenson,  37  Pa.  St.  293.  And  see  also 
Perry  T'ounty  Ins.  Co.  v.  Stewart,  19  Pa.  St.  45. 

3  8  Cush.  (Mass.)  393. 

*  Langdon  v.  Equitable  Ins.  Co.,  1  Hall  (N.  Y.  Superior  Ct.),  226  :  s.  c.  6 
Wend.  (N.  Y.)  623. 

456 


CH.  XI.]      SPECIAL    PROVISIONS   OF   THE    CONTRACT,   ETC.         [§  230 

tract.  ^  Undoubtedly  there  maybe  such  a  marked  and  seri- 
ous change  from  a  risk  of  the  lowest  grade  to  one  of  the 
higliest,  and  under  such  circumstances  as  obviously  not  to 
have  been  within  the  contemplation  of  either  party ;  in  fact, 
converting  the  property  insured  into  a  substantially  differ- 
ent subject-matter,  and  such  a  change  as  no  fair-minded 
man  would  regard,  or  have  a  right  to  regard,  as  protected 
under  the  original  policy,  —  as  where  loose,  unbaled  hay  is 
stored  in  a  building  insured  as  a  grocery.  In  such  a  case 
the  question  would  be,  whether  the  change  was  in  degree  or 
kind  within  such  reasonable  limits  as  to  be  consistent  with 
good  faith,  or  whether  it  was  of  such  an  extravagant  charac- 
ter as  to  evince  an  utter  disregard  of  the  just  rights  and  ex- 
pectations of  the  insurers,  and  an  obvious  absence  of  good 
faith. 2  (a)      If    the   policy,    however,    provide    against   any 

1  Pirn  V.  Reid,  6  M.  &  G.  1  ;  Shaw  v.  Robberds,  6  Ad.  &  El.  75.  In  Sillem  v. 
Thornton,  3  El.  &  Bl.  868,  Lord  Campbell  says,  Pirn  v.  Reid  was  decided  solely 
on  a  question  of  pleading,  and  doubts  the  doctrine  stated  in  that  case.  But 
the  case  then  under  consideration  did  not  at  all  resemble  either  of  the  cases 
critici-sed. 

2  Robinson  v.  Mercer  County  Mut.  Fire  Ins.  Co.,  3  Dutch.  (X.  J.)  134;  Ditt- 
mer  v.  Germania  Ins.  Co.,  23  La.  An.  4.58.  And  see  also  the  observations  of 
Lord  Campbell  iu  Sillem  v.  Thornton,  3  El.  &  Bl.  866,  citeApost,  §  257. 

(a)    If  the  insurer  asks  no  informa-  shall   be  forfeited   "by  any  change  in 

tion  and  the  insured  makes  no  repre-  the  use  or  condition  of  the  building, 

sentations,  and  the  insurer  chooses  to  including  additions  or  repairs,  or  by  the 

assume  the  risk,  he  must  be  presumed,  erection  of  other  buildings,  or  in  any 

iu   point  of  law,  to  do  so  at  his  own  other  manner  by  which  the  degree  of 

peril  ;  and  when  the  insurer  is  familiar  the  risk  is  increased,  unless  due  notice 

with  the  property  and  its  uses  and  oc-  is  given  to  the  company,   and   a  new 

cupation  before  insuring,  he  is  estopped  agreement  is  entered  into,"  applies  to 

from  setting  up  a  misstatement  in  refer-  such   changes   as   are   of  a  permanent 

ence  thereto  in  the  application.  Wythe-  nature,    and    not    to    mere   temporary 

ville  Ins.  Co.  v.  Stultz,  87  Va.  629.    An  changes  in  the  use  and  occupation  of 

insurance  company,  in  order  to  avpid  a  the  premises  ;  hence  a  mere  temporary 

policy  on  the  ground  that  the  premises  use  of  a  machine  for  threshing  grain  for 

were  put  to  a  use  not  represented  when  a  few  hours  on  the  premises  where  the 

the  insurance  was  made,   whereby  the  insured  projierty  is  located  will  not,  per 

risk  was  increased,  must  show  that  the  sc,  work  either  a  forfeiture  or  suspen- 

assured  knew  that  such  use  increased  sion  of  such  policy.    But  if  the  insured, 

the  risk  and  the  rate,  and  that  he  con-  or  one  to  whom  he  has  intrusted  the 

cealed  it  from  the  company.     McGoni-  entire   custody   of    the    property,    and 

gle  V.  Susquehanna  Mutual  F.  Ins.  Co.,  given  full  freedom  in  its  use,  should, 

168    Penn.    St.    1.     A   provision    in   a  by  doing  any  act  or  acts  which  one  in 

policy  of  fire  insurance  declaring  that  it  the  exercise  of  ordinary  care  and  dili- 

457 


§  230] 


insurance:   riKE,   LIFE,   ACCIDENT,   ETC. 


[CH.  XI. 


change  of  use  increasing  the  risk,  the  question  will  not  be 
whether  the  increase  is  greater  or  less,  but  whether  it  is 
material,^  though,  even  under  such  a  prohibition,  while  the 
insured  is  bound  to  a  rigorous  course  of  conduct  in  prevent- 
ing any  increase,  it  ought  to  be  left  to  the  jury  whether  the 
materiality  is  substantial,  as  whether,  for  instance,  the  keep- 
ing a  jug  of  petroleum  in  one's  room  for  medicinal  purposes 
is  an  occupation  of  the  premises  in  a  way  to  make  them 

1  Heivey  v.  Mut.  Fire  Ins.  Co.,  11  U.  C.  (C.  P.)  394. 


gence  would  not  do  under  like  circum- 
stances, so  change  the  use  and  occupancy 
of  the  premises  as  to  material!}^  increase 
the  hazard  of  the  insurance,  the  insur- 
ance com])any  would  not  be  liable  for  a 
loss  directly  resulting  as  a  consequence 
of  such  increase  of  risk.  Adair  v.  South- 
ern Mut.  Ins.  Co.,  107  Ga.  297.  Insur- 
ance upon  a  tin-shop  covers  the  making 
of  tin  cans  and  the  soldering  of  strips  of 
tin  for  roofing,  this  being  the  obvious 
daily  work  of  a  tin-shop.  Va.  F.  &  ]\I. 
Ins.  Co.  V.  Thomas,  90  Va.  658.  A 
policy  on  a  canning  factory,  to  cover 
the  interval  after  the  season  was  ended, 
and  providing  that  it  should  be  occu- 
pied only  for  storage,  is  not  violated  by 
clearing  up  the  premises,  and  building 
a  fire  to  empty  the  boiler  and  pipes  of 
water.  Krug  v.  German  F.  Ins.  Co., 
147  Penn.  St.  272.  A  policy  insuring 
a  building  while  occupied  as  a  saddlery, 
and  providing  that  it  shall  be  void  if 
the  risk  is  increased  by  a  change  of 
occupation,  is  not  avoided  by  a  change 
of  occupation  when  the  risk  is  not  ia- 
creased.  East  Texas  F.  Ins.  Co.  v. 
Kempner  (Tex.  Civ.  App. ),  2-3  Ins.  L. 
J.  549.  Where  the  policy  stipulated 
that  the  property  was  to  be  occupied 
as  a  foundry  and  machine  shop,  and  it 
was  never  so  used,  the  stipulation  was 
held  a  warranty,  and  the  knowledge 
of  its  breach  by  an  agent  authorized 
only  to  receive  applications  and  deliver 
policies  was  held  not  a  waiver.  Sun 
Mutual  Ins.  Co.  v.  Texarkana  Foundry 
&  Machine  Co.  (Texas),  20  Ins.  L.  J. 
458 


856.  Where  the  insured  property  was 
situated  in  adjoining  State,  and  the  per- 
sons insured  were  residents  of  another 
State,  but  the  agent  of  the  insurance 
company  through  whom  the  insurance 
was  effected  resided  near  the  property 
insured,  and  had  notice  of  the  uses  to 
which  the  building  was  applied,  his 
knowledge  is  deemed  that  of  the  com- 
pany, and  it  is  too  late,  after  a  loss  has 
occurred,  to  object  upon  the  ground 
that  the  building  was  applied  to  uses 
prohibited  in  the  policy.  Springfield 
F.  &  M.  Ins.  Co.  V.  McLimans,  28  Neb. 
846.  Where,  under  a  policy  stipulating 
that  a  sprinkler  "  now  in  use"  .should 
be  maintained,  the  company  accepted 
the  premiums  with  knowledge  of  the 
fact  that  there  was  no  sprinkler,  this 
was  held  a  waiver.  Milkman  v.  United 
Mut.  Ins.  Co.,  20  R.  I.  10.  Where 
the  defendant  having  insured  against 
loss  by  fire  a  threshing  machine,  engine, 
and  separator,  "  whilenot  in  use,"  the 
property,  which  had  not  been  used  for 
threshing  for  some  two  weeks,  was 
hauled  out  into  the  country,  and  left 
standing  near  a  farm-house,  preparatory 
to  its  intended  use  a  few  days  later, 
and,  while  standing  there,  the  separator 
was  destroyed  by  afire,  which  was  not 
caused  by  any  hazard  incident  to  the 
actual  use  or  operation  of  either  the 
engine  or  separator,  the  property  was 
held  not  to  be  "  in  use "  within  the 
meaning  of  the  policy.  Minneapolis 
Threshing  Machine  Co.  v.  Firemen's 
Ins.  Co.,  57  Minn.  35. 


CH.  XI.]      SPECIAL    PROVISIONS    OF   THE    CONTRACT,    ETC.        [§231 

more  hazardous.^  [The  occupation  of  a  portion  of  a  "tav- 
ern-barn "  as  a  livery  stable  increases  the  risk  and  avoids 
the  policy. 2] 

§  231.  Statement  of  Present  Use  generally  no  "Warranty.  — 
Where  the  policy  merely  describes  the  property  insured  as 
used  or  occupied  for  a  particular  purpose,  and  there  is  no 
prohibition  of  a  change  in  the  use  or  occupation,  the  insured 
■will  only  be  held  to  the  truth  of  the  statement  at  the  time 
when  the  insurance  is  effected.  Such  statement  will  not 
be  construed  into  a  warranty  that  the  subject-matter  of  in- 
surance shall  continue  to  be  so  occupied  or  used  during  the 
currency  of  the  policy.  Nor  will  a  change  in  the  use  or 
occupancy  of  the  property  insured,  still  keeping  within  the 
same  character  of  risk,  and  not  increasing  the  risk,  avoid 
the  policy.  If  the  insurers  wish  to  guard  absolutely  against 
change,  they  must  do  so  by  appropriate  and  positive  stipula- 
tion. 3(a)  In  Woodv.  Hartford  Fire  Insurance  Company,*  the 
insurance  was  upon  a  paper-mill,  which  was  a  special  memo- 
randum risk,  with  a  prohibition  to  use  for  purposes  classed 
as  "hazardous  or  extra-hazardous,"  and  a  grist-mill  was 
added  to,  or  rather  substituted  for,  a  portion  of  the  paper- 
mill,  but  without  substantially  affecting  the  efficiency  of  the 
latter.  And  it  was  held  that  this  was  not  a  change  from  a 
paper-mill  to  a  grist-mill,  and,  if  it  had  been,  as  the  grist- 
mill was  also  a  memorandum  risk,  it  M-ould  not  have  avoided 
the  policy.     So  a  dwelling-house  may  be  used  for  a  board- 

1  "Williams  v.  People's  Ins.  Co.,  57  N.  Y.  274. 

2  [Hobby  V.  Dana,  17  Barb.  Ill,  115.] 

3  Smith  V.  Mechanics'  &  Traders'  Fire  Ins.  Co.,  32  X.  Y.  399  ;  Schmidt  V. 
Peoria  llav.  &  Fire  Ins.  Co.,  41  111.  295.     But  see  post,  §§  231,  255. 

*  13  Conn.  533. 

(a)  A  clause  in  a  policj'  which  makes  153  Mass.  475.  Representations  of  ex- 
express  provision  for  the  future  cannot  isting  facts,  as  the  description  in  the 
be  done  away  by  mere  implication  or  policy  that  the  insured  property  is  a 
inference  ;  but  when  an  existing  fact  is  dwelling-house  occupied  by  tenants,  is  a 
at  variance  with  a  clause  of  a  policy,  vital  warranty  of  such  occupancy  at  the 
and  is  known  by  the  insurer  to  be  so,  inception  of  the  contract.  Boyd  v.  Ins. 
there  may  be  an  implication  that  the  Co.,  90  Tenn.  212.  So  misrepresenta- 
clause  is  not  insisted  upon.  Xewmar-  tions  as  to  previous  fires  in  an  insured 
ket  Sav.  Bank  i'.  Royal  Ins.  Co.,  150  mill  are  fatal.  Rosebud  M.  Co.  i-."\Vestern 
Mass.  374  ;  Stone  v.  Howard  Ins.  Co.  Ass.  Co.  (U.  S.  C.  C),  25  Ins.  L.  J.  693. 

459 


8  232]  insurance:    FIEE,   life,   accident,   etc.  [cH  XL 

ino--house,  if  the  latter  be  not  included  in  some  class  of 
o-reater  risk.^  Under  a  permitted  use,  an  enlarged  use  for 
the  same  purpose  is  not  such  an  increase  of  risk  as  avoids 
a  policy.  The  increase  of  risk  to  have  that  effect  must  come 
from  some  other  source. ^  A  mere  exclusion  from  the  risk 
is  not  a  prohibition  which  works  a  forfeiture.  Thus,  where 
a  policy  expressly  provides  that  "gunpowder  is  not  insurable 
unless  by  special  agreement,"  and  enumerates  gunpowder 
amongst  the  extra-hazardous  articles,  and  further  provides 
that  the  building  insured  is  privileged  to  contain  extra- 
hazardous merchandise,  gunpowder  may  be  kept  without 
prejudice  to  the  right  to  recover  under  the  policy  in  case 
of  loss.  The  effect  of  the  stipulation  is  merely  to  exempt 
the  insurers  from  liability  for  the  gunpowder. ^ 

§  232.  Classification  of  Risks ;  Hazardous  Goods.  —  As  not 
all  subject-matters  of  insurance  are  equally  hazardous,  in- 
surers have  adopted  the  plan  of  classifying  the  various  risks 
which  they  assume  into  special  categories,  such  as  not  haz- 
ardous, hazardous,  extra-hazardous,  specially  hazardous,  and 
memorandum  articles,  or  such  as  are  not  insurable  at  all,  or 
only  upon  special  terms,  upon  which  several  classes  differ- 
ent rates  of  insurance  are  charged.  It  is  obvious  that  an 
insurance  upon  one  class  ought  not,  and  in  point  of  law  it 
does  not,  cover  property  in  goods  in  another ;  and  the  policy 
may  be,  and  frequently  is,  so  drawn  that  if,  under  a  policy 
insuring  specifically  one  class,  articles,  or  modes  of  use,  or 
practices,  embraced  in  another  according  to  the  arbitrary 
classification  of  the  insurers,  are  introduced,  kept,  stored, 
or  permitted,  the  policy  becomes  void;  as  when  the  policy 
expressly  provides  that  any  particular  class  or  classes  of 
articles  shall  not  be  kept,  nor  any  particular  practice  or 
mode  of  use  adopted  or  carried  on,  unless  specially  provided 
for.  Thus,  if  the  insurance  be  in  terms  upon  "stock  in 
trade,  consisting  of  merchandise  not  hazardous,"  the  keep- 

1  Rafferty  v.  New  Brunswick  Fire  Ins.  Co.,  3  Harr.  (N.  J.)  480  ;  post,  §237. 

2  Mayor,  &c.  v.  Hamilton  Fire  Ins.  Co. ,  10  Bosw,  (N.  Y.  Superior  Ct.)  537  ; 
Baxendale  v.  Harvey,  4  H.  &N.  (Exch.)  445. 

8  Duncan  v.  Sun  Fire  Ins.  Co.,  6  Wend.  (N.  Y.)  488. 

460 


CII.  XI.J      SPECIAL   PROVISIONS    OF   THE    CONTRACT,   ETC.         [§  232 

ing  of  hazardous  articles,  though  a  part  of  the  general  stock, 
so  denominated  in  the  memorandum,  will  avoid  the  policy, 
since  the  very  description  of  the  subject-matter  excludes 
such  hazardous  articles.  The  doctrine,  in  such  cases,  is 
well  stated  by  Shepley,  C.  J.,  in  Richards  v.  Protection 
Insurance  Company,i  ^here  the  policy  was  on  "stock  in 
trade  consisting  of  merchandise  not  hazardous,"  and  where 
the  keeping  of  oil,  tallow,  and  glass,  enumerated  as  extra- 
hazardous, as  part  of  the  stock,  was  held  to  avoid  the  policy. 
And  this  doctrine  has  been  recently  applied  in  a  case 
where  fireworks  and  other  merchandise,  hazardous  and  extra- 
hazardous,   were   included    in   the    policy,    but   which   also 

1  30  Me.  273.    The  judge  said  :   "Four  classes  of  hazards  are  named  in  the 
conditions  annexed  to  the  policy,  denominated  not  hazardous,  hazardous,  extra- 
hazardous, and  memorandum  of  special  risks.     The  goods  insured  were  by  the 
plaintiffs  declared  to  be  of  the  first  class.     The  goods  before  named  were  not  of 
that  class,  but  were  of  the  second  class,  denominated  hazardous.     (The  plaintiffs 
procured  insurance  '  on  their  stock  in  trade,  consisting  of  not  hazardous  merclian- 
dise.')     Insurance  is  proposed  to  be  made  upon  goods  contained  in  these  three 
different  classes  at  different  rates  of  premium.     The  classes  of  hazard,  and  the 
conditions  of  insurance  annexed  to  the  policy,  form  a  part  of  the  contract  between 
the  parties.     That  contract  requires  mutual  good  faith  and  fair  dealing.     The 
law  presumes  that  the  parties  acted  with  intelligence.     The  defendants  did  not 
propose  to  insure  goods  of  the  class  denominated  hazardous  at  the  premium  affixed 
for  the  class  denominated  not  hazardous.     Nor  did  they  propose  to  insure  goods 
composed  partly  of  one  class  and  partly  of  the  other,  at  the  rate  of  premium 
affixed   to   the    least   hazardous.     This   appears    from   the   language   used  ;    for 
'groceries,  with  any  hazardous  articles,'  are  enumerated  in  the  class  of  hazardous. 
If  the  plaintiffs,  having  procured  insurance  on  their  stock  in  trade,  consisting  of 
not  hazardous  articles,  could  have  kept  a  stock  of  goods  for  sale  composed  entirely 
of  hazardous  articles,  and  could  have  recovered  for  a  loss  of  them  by  fire,  they 
could  do  so  only  by  compelling  the  defendants  to  become  insurers,  and  to  bear 
the  loss  for  a  compensation  less  than  the  one  affixed  to  such  a  class  of  goods,  and 
less  than  the  one  agreed  upon  by  the  parties  as  appropriate  to  such  a  risk.     So 
if  they  could  have  kept  goods  for  sale  composed  partly  of  the  first  and  partly  of 
the  second  class  of  risks,  and  could,  after  a  loss  of  them  by  fire,  have  recovered 
for  them,  the  defendants    would   have   been  compelled  to  bear  the  loss  for   a 
premium  less  than  that  for  which  they  would  have  knowingly  assumed  the  risk. 
The  injustice  in  the  latter  case  would  not  be  so  great  as  in  the  former,  but  a 
recovery  would  be  equally  unauthorized  according  to  the  terms  of  the  contract. 
The  description  of  the  property  insured  in  the  body  of  the  policy,  when  the  rate 
of  premium  is  thereby  affected,  operates  as  a  warranty  that  the  property  is  of  the 
character  and  class  described  ;  and  that  the  property  is  all,  and  not  partly,  of 
that  character  and  class.     Such  a  warranty  is  in  the  nature  of  a  condition  pre- 
cedent, and  performance  of  it  must  be  shown  by  the  person  insured  before  he  can 
recover  upon  his  policy."     See  also  Pindar  v.  Resolute  Fire  Ins.  Co.,  38  N.  Y.  366. 

461 


§  23:>J  INSURAXCE  :   FIRE,   LIFE,   ACCIDENT,    ETC.  [CH.  XI. 

eniiinerated  fireworks  as  in  a  different  class.  Thus,  under 
a  policy  insuring  ''fireworks,  ordnance  stores,  and  other 
merchandise,  hazardous  and  extra-hazardous,"  "in  the  sec- 
nd  class  of  hazards,"  in  which  were  included  fire-crackers 
i  matches,  but  putting  "fireworks"  in  the  specially  haz- 
ardous category  of  the  third  class,  it  was  recently  held  in 
New  York  that  keeping  that  description  of  fireworks,  which 
was  so  specially  dangerous  as  by  the  ordinance  to  be  prohib- 
ited storage  in  the  city,  if  thereby  the  risk  was  increased, 
and  it  seems  if  it  was  not,  would  avoid  the  policy.  The 
court  said  it  could  not  be  presumed  that  it  was  intended  to 
cover  an  article  so  specially  hazardous  as  to  be  prohibited 
storage,  but  only  such  as  were  permitted  storage  and  to  be 
sold  at  retail.^  And  permission  to  keep  fire-crackers  does 
not  give  the  right  to  keep  fireworks.  Thus  insurance  "on 
a  stock  of  fancy  goods  and  other  articles  in  his  line  of  busi- 
ness," &c.,  and  "privileged  to  keep  fire-cracJcers  on  sale," 
does  not  authorize  the  keeping  of  fire-works,  since  fireworks 
are  not  included  under  the  license  to  keep  fire-crackers,  and 
they  could  not  be  included  under  the  general  words,  "  other 
articles  in  his  line  of  business,"  where  by  the  terms  of  the 
policy  they  are  not  covered  unless  specially  permitted.^ 

§  233.  stock  in  Trade,  such  as  usually  kept.  —  While,  how- 
ever, as  we  have  seen  in  the  preceding  section,  if  the  policy 
insures  only  one  class  of  articles  and  expressly  excludes 
other  classes,  the  keeping  of  an  article  in  the  excluded  class, 
although  it  be  usually  kept  with  the  class  of  goods  actually 
insured,  will  avoid  the  policy,  yet  if  the  policy  describe  the 

1  Jones  r.  Fireman's  Fund  Ins.  Co.,  2  Daly  (N.  Y.),  307,  affirmed  51  N.  Y. 
318. 

2  Steinbach  v.  Relief  Ins.  Co.,  13  Wall.  (U.  S.)  183.  But  in  Steinbach  v. 
La  Faj-ette  Fire  Ins.  Co.,  54  N.  Y.  90,  95,  which  was  a  case  upon  similar  facts, 
the  New  York  Court  of  Appeals  referred  to  this  case  as  not  well  considered, 
and  adhered  to  the  settled  line  of  decisions  in  that  State  to  the  contrary.  And 
this  case  is  cited  and  approved  by  Clifford,  J.,  in  James  v.  Lycoming  Fire  Ins 
Co.,  4  Cliff.  C.  Ct.  272.  In  Wood  v.  North  Western  Ins.  Co.,  46  N.  Y.  421,  where 
the  keeping  of  camphene  or  "  any  other  inflammable"  liquid  was  prohibited,  and 
it  was  found  that  kerosene  was  kept,  the  court  refused  to  set  aside  a  verdict 
for  the  plaintiff,  there  being  no  proof  that  kerosene  was  inflammable,  and  they 
would  not  assume  it. 

462 


CH.  XI.]      SPECIAL    PROVISIONS    OF    THE    CONTRACT,   ETC.        [§  233 

property,  the  stock  insured,  as  such  as  is  "usually  kept  in 
a  country  store,"  this  qualification  enlarges  the  scope  of  the 
policy,  so  that  it  will  attach  to  and  cover  memorandum 
articles,  or  any  articles  enumerated  in  the  non-insured 
classes.^  The  keeping  of  the  memorandum  articles  is  usu- 
ally made  to  avoid  the  policy,  unless  otherwise  provided 
therein.  And  this  qualification  of  the  description  of  the 
subject-matter  is  equivalent  to  a  provision  in  the  policy 
whereby  the  memorandum  articles  are  permitted  to  be  kept 
and  insured. 2  So  where  the  policy  is  upon  "merchandise 
such  as  is  usually  kept  in  country  stores."  Under  such  a 
description  of  the  risk,  all  articles  such  as  can  be  shown  to 
be  usually  kept  in  country  stores  are  covered  and  protected 
by  the  policy,  although  they  may  be  enumerated  in  the  sec- 
ond classes  of  risks. ^  [If  firewoi-ks  are  usually  kept  in  con- 
fectionery stores  the  keeping  of  them  will  not  violate  a 
policy   covering   the   usual   stock   of   such  stores,    although 

1  [If  a  policy  insures  "drugs'*  and  "such  other  merchandise  as  is  usually 
kept  in  a  country  store,"  and  the  printed  provisions  except  benzine  unless  per- 
njission  is  obtained,  it  is  competent  to  show  that  benzine  is  usually  kept  in  a 
country  store,  and  that  the  general  agent  stated  at  the  issue  of  the  policy  that 
it  included  benzine.  Carrigan  v.  Insurance  Co.,  53  Vt.  418.  When  the  printed 
part  of  a  policy  of  insurance  on  goods  prohibited  the  keeping  of  saltpetre,  but  by 
a  written  portion  "  all  goods  kept  for  sale  in  such  stock  "  are  permitted  to  be  kept, 
the  latter  was  held  to  overcome  the  former  ;  Stout  v.  Commercial  Union  Ass. 
Co.,  11  Biss.  309,  313,  7th  Cir.  Ind.  1882,  11  Ins.  L.  J.  688,  14  Rep.  577,  dis- 
tinguishing Steinbach  v.  Ins.  Co.,  13  Wall.  183,  or  trying  to  do  so  ;  and  even 
the  fact  that  gunpowder,  also  a  prohibited  article,  was  specially  permitted 
did  not  prove  that  it  was  the  only  prohibited  article  permitted.  A  policy  on 
a  "stock  of  dry-goods,  groceries,  and  merchandise  usually  kept  in  a  country 
store"  will  cover  articles  usually  so  kept,  as  gunpowder,  although  prohibited 
by  a  general  printed  clause.  But  where  in  addition  to  such  prohibition  there 
is  a  clause  allowing  a  specified  and  reasonable  quantity  of  the  article  to  be 
kept,  evidence  is  not  admissible  to  show  that  country  stores  usually  keep  a 
larger  quantity  of  it.  Pittsburgh  Ins.  Co.,  v.  Frazee,  107  Pa.  St.  521.  But 
when  the  written  part  of  a  policy  insured  all  goods  commonly  kept  in  a 
country  retail  store  against  loss  by  fire,  "except  as  hereinafter  provided," 
and  a  subsequent  printed  clause  excepted  benzine  and  turpentine,  it  was 
held,  overruling  the  decision  of  the  lower  court,  that  the  policy  was  avoided 
by  keeping  turpentine.  Lancaster  Fire  Insurance  Company  v.  Lenheim,  89 
Pennsylvania  State  Reports,  497,  502  ;  Insurance  Company  v.  Kroegher,  2 
Norris,   64.] 

2  Pindar  v.  King's  County  Ins.   Co.,  36  N.  Y.  648. 

8  Franklin  Fire  Ins.  Co.  v.  Updegrafi,  43  Pa.  St.  350,  353.  And  see  post, 
§  239. 

463 


J  233]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  XI. 

they  are  expressly  prohibited  in  the  printed  provisions. ^  (a) 
Where  the  printed  conditions  exclude  certain  articles  as 
extra-hazardous,  and  the  written  description  of  the  risk  in- 
cludes some  of  the  articles,  the  writing  overweighs  the 
print;  but  "family  groceries,  wines,  liquors,  tobacco,  and 
cigars"  does  not  cover  fireworks. ^J  But  in  the  case  of 
Macomber  v.  Howard  Fire  Insurance  Company,^  where  the 
policy  was  upon  a  stock  in  trade  described  as  consisting 
of  "dry -goods,  groceries,  hardware,  crockery,  glass  and 
wooden  ware,  Britannia  and  tin  ware,  stoves  of  various 
kinds,  and  various  other  wares  and  merchandise,^^  and  pro- 
vided that  the  use  of  the  premises  for  the  purpose  of  keep- 
ing or  storing  any  of  the  articles  denominated  hazardous  or 
extra-hazardous  in  the  conditions  annexed  to  the  policy 
should  avoid  the  policy  unless  otherwise  especially  provided 
for,  and  "groceries  with  any  hazardous  articles,"  "rags," 
and  other  articles  were  enumerated  as  hazardous,  and  were 
in  fact  kept  upon  the  premises,  the  policy  was  held  to  be 
void,  although  the  excepted  articles  were  such  as  were  usu- 
ally kept  in  such  a  stock  in  trade.  Under  the  modern  ten- 
dency, however,  to  interpret  liberally  in  favor  of  the  object 
of  the  contract,  and,  in  cases  of  doubt,  strictly  against  the 
insurer,  it  is  doubtful  if  this  case  would  be  followed  in  other 
courts  except  upon  the  same  identical  facts,  and  perhaps  not 

1  [Plinsky  v.  Germania  Fire  &  Jlar.  Ins.  Co.,  32  Fed.  Rep.  47  (Mich.),  18S7.] 

2  [Georgia  Home  Ins.  Co.  v.  Jacobs,  56  Tex.  366.] 

3  7  Gray  (Ma.ss.),  257.  See  also  Wetherell  v.  City  Fire  Ins.  Co.,  16  Gray 
(Mass.),  276,  where  the  policy  was  upon  a  "store,"  and  "sail-making"  and 
"  confectioneiy  "  were  inti'oduced,  though  prohibited. 

(a)  The  insurer's  permit  to  store  fire-  Phoenix  Ins.  Co.  v.  Flemming,  65  Ark. 

works  in  the  insured  building  for  fifteen  54.     The  keeping  of  fireworks  over  the 

days   does   not  justify   their   retention  night  before  the  Fourth  of  July  is  within 

there  beyond  that  period,  or  waive  any  a  condition  of  the  policy  avoiding  it  in 

future  forfeiture  for  this  cause  ;  but  at  case  the  hazard  is  increased  with  the 

the  expiration  of  the  fifteen  days,  the  insured's    knowledge,    or   if    fireworks, 

insured's  failure  to  remove  the  fireworks  &c.  are  allowed  on  the  premises.     Heron 

makes    the     policy    ipso    facto    void.  v.  Phcenix  Mut.  F.  Ins.  Co.,  180  Penn. 

Betcher  v.  Capital  F.  Ins.  Co.  (Minn.),  St.  257.    See  Heffron  v.  Kittanning  Ins. 

29   Ins.    L.  J.  115;  Heron  v.  Phcenix  Co.,  132  Penn.  St.  580. 
Mut.  F.  Ins.   Co.,  180  Penn.  St.  257  ; 

464 


CH.  XI.]      SPECIAL    PROVISIONS    OF   THE    CONTRACT,    ETC.        [§  234 

in  the  same  court.  ^  [There  is,  however,  a  case  in  Pennsyl- 
vania where  the  policy  provided  that  no  petroleum,  &c., 
should  be  "  had  or  kept  "  on  the  insured  premises  (the  in- 
surance being  on  a  stock  of  merchandise  in  a  common  coun- 
try store),  and  it  was  held  that  a  charge  of  the  lower  court 
that  if  petroleum  was  usual  in  the  stock  of  that  kind  of  a 
store  the  assured  could  recover,  was  error.  The  court  re- 
marked that  perhaps  the  very  reason  of  the  prohibition  was 
that  such  a  custom  existed. ^  It  would  be  useless  if  such 
goods  were  not  so  kept.  And  in  Ohio,  in  case  of  a  policy 
on  a  "general  stock  of  hardware  and  agricultural  imple- 
ments," evidence  will  not  be  admitted  to  show  a  custom 
among  hardware  dealers  in  the  villages  of  Ohio  to  keep 
gunpowder  and  petroleum.^] 

§  234.  Permission  strictly  construed.  —  But  nothing  will 
be  allowable  under  such  an  implied  permission  not  fairly 
within  the  scope  of  the  general  words  of  qualification;  and 
though  a  policy  prohibiting  the  use  of  premises  for  hazard- 
ous purposes  may  in  certain  cases  cover  the  keeping  for  sale 
of  hazardous  articles,  on  the  ground,  by  fair  implication, 
that  they  are  included  within  the  general  stock  insured,  it 
will  not  cover  the  use  of  such  hazardous  articles  for  lighting 
or  other  like  purpose,  if  their  use  be  prohibited  upon  the 
premises.*  It  is  one  thing  to  appropriate  premises  to  the 
keeping  of  a  hazardous  article  for  sale,  and  another  to  use 
the  hazardous  article  upon  the  premises  for  the  purpose  of 
illumination  or  manufacture.  A  permission  to  keep  kero- 
sene or  gunpowder  for  sale,  it  is  obvious,  cannot  be  fairly 
construed  into  a  permission  to  manufacture  or  use  them  upon 
the  premises,   since  the  risks  in  the  respective  cases  may 

1  See  Elliot  v.  Hamilton  Mut.  Ins.  Co.,  13  Graj-  (Mass.),  139  ;  Whitraarsh  v. 
Conway  Fire  Ins.  Co.,  16  Gray  (Mass.),  359.  Insurance  of  a  \'inage  "grocery  " 
covers  liquors  in  Upper  Canada,  and  the  non-disclosure  of  the  fact  that  liquors 
are  kept  does  not  avoid  the  policy.  Nicholson  v.  Phoenix  Ins.  Co.,  U.  C.  (Q.  B.) 
17  Can.  L.  J.  22,  1880.     And  seejJost,  §  239. 

2  [Birmingham  Fire  Ins.  Co.  v.  Kroegher,  83  Pa.  St.  64,  66.] 

8  [Beer  v.  Forest  City  Mut.  Ins.  Co.,  89  Ohio  St.  109.     See  also  §  238.] 

*  Mead  v.  KorthwestVrn  Ins.  Co.,  3  Seld.  (N.  Y.)  530  ;  AVestfnll  v.   Hud.son 

River  Fire  Ins.  Co.,  2  Kern.  (N.  Y.)  289,  reversing  s.  c.  2  Duer  (N.  Y.  Superior 

Ct.),  490. 

VOL.  I.  —  30  465 


§  236]  INSURANCE  :   FIRE,    LIFE,   ACCIDENT,   ETC.  [CH.  XI. 

widely  differ. ^  [Permission  in  a  policy  to  keep  "hazard- 
ous "  goods  does  not  permit  the  keeping  of  goods  especially 
or  ext7'a  hazardous.  It  is  not  used  in  a  general  sense,  but  is 
a  word  well  known  to  be  subdivided  in  policies. ^  If  a  policy 
prohibits  the  keeping  of  gasoline  or  benzine  but  authorizes 
the  use  of  gasoline  gas,  the  latter  authority  does  not  permit 
the  keeping  of  gasoline  or  benzine  on  the  premises  for  any 
other  purpose  than  the  manufacture  of  gasoline  gas.^] 

§  235.  Hazardous  Goods  defined.  —  Under  the  prohibition 
of  the  storage  of  hazardous  articles,  a  distinction  has  been 
taken  between  those  articles  which  are  deemed  hazardous  by 
reason  of  their  greater  liability  to  injury  in  case  of  fire,  and 
those  which  increase  the  risk  of  fire;  and  it  has  been  said 
that  it  is  only  the  latter  class  of  articles  which  can  be  rea- 
sonably regarded  as  coming  within  the  prohibition,  so  as  to 
avoid  the  policy.* 

§  236.  Classification  of  Risks ;  Hazardous  Trades.  —  If  the 
terms  of  the  policy  classifying  the  risks  are  defined  in  the 
policy  itself,  this  will  usually  control  the  meaning.  But  if 
at  the  time  of  issuing  the  policy  any  clause  is  inserted  which 
is  inconsistent  with  the  definition,  or  renders  it  doubtful 
whether  it  ought  to  apply,  the  doubt  will  be  resolved  in 
favor  of  the  insured.  For  example,  a  policy  provides  in 
writing,  after  a  description  of  the  premises,  that  they  are 
privileged  to  be  occupied  as  hide,  fat-melting,  slaughter, 
and  packing  houses,  and  stores  and  dwellings,  and  for  other 
extrsi-hazardous  purposes.  In  the  second  class  of  risks  are 
included  "hazardous  No.  2,"  "extra-hazardous  No.  2," 
"extra-hazardous  No.  3,"  and  "specially  hazardous."  The 
occupations  specially  privileged,  such  as  "hide,  fat-melting, 
slaughter,  and  packing  houses,  &c.,"  do  not  fall  within  any 
definition  of  "extra-hazardous,"  but  do  come  within  the 
definition  of  "specially  hazardous,"  to  which  class  distil- 
leries belong,  and  the  building  insured  was  used  as  a  dis- 

1  And  see  post,  §  237. 

2  [Pindar  v.  Continental  Ins.  Co.,  38  N.  Y.  364.] 

8  [Liverpool,  &c.  Ins.  Co.  v.  Gunther,  116  U.  S.  113,  130.] 
*  Rathbone  v.  City  Fire  Ins.  Co.,  31  Conn.  193. 

466 


CH.  XI  ]      SPECIAL    PROVISIONS    OF    THE    CONTRACT,   ETC.        [§  237 

tillery.  Upon  these  facts,  and  on  the  ground  that  where 
there  is  an  inconsistency  between  the  written  and  printed 
portions  of  the  policy,  the  former  must  prevail,  it  was  held 
that  the  words  in  the  policy,  "  or  other  extra-hazardous  pur- 
poses," must  be  taken  to  mean  purposes  of  the  same  class, 
and  those  like  fat-melting  houses,  &c.,  as  if  they  read  "other 
like  purposes;"  and  as  these  were  included  in  "specially 
hazardous,"  and  distilleries  were  included  in  the  same  class, 
the  use  of  the  building  as  a  distillery  was  permissible  under 
the  policy,  though  not  included  in  the  definition  of  "extra- 
hazardous "  risks,  and  this  term  as  used  in  the  policy  must 
be  qualified  accordingly  as  applicable  to  the  particular 
case.^ 

§  237.  An  additional  Use  of  the  Same  or  Lower  Grade  of 
those  prohibited  is  fatal.  —  But  it  has  been  held  that  the  right 
to  use  a  building  for  one  hazardous  or  extra-hazardous  pur- 
pose does  not  carry  with  it  the  right  to  use  it  for  another 
additional  and  different  purpose,  though  it  be  in  the  same 
class  of  risks.  While  a  substitution  of  one  use  for  another 
in  the  same  class  of  risks  would  not  increase  the  risk,  an 
additional  use  or  business  would  have  that  effect. 2     [If  a 

1  Eeynolds  v.  Com.  Fire  Ins.  Co.,  47  N.  Y.  597.     And  see  post,  §  239,  note. 

2  Lee-y.  Howard  Fire  Ins.  Co.,  3  Gray  (Mass.),  583,  592;  Wash.  Mut.  Ins. 
Co.  V.  Merch.  &  Maniif.  Mut.  Ins.  Co.,  5  Ohio  St.  450,  reversing  s.  c.  1  Handy 
(Cincinnati  Superior  Cl.),  185.  But  see  ante,  §  231.  In  the  case  from  Massa- 
chusetts, the  designated  property  was  "  a  pail  factory,  chair-shop,  saw-mill,  and 
stores  connected  therewith,"  with  a  provision  that  the  property  should  not  be 
"applied  or  used  to  or  for  any  trade,  business,  or  vocation  enumerated  in  the 
class  of  hazards,"  which  was  thus  expounded  by  Bigelow,  J.  :  "  It  is  conceded 
that  the  premises  insured,  in  addition  to  the  purposes  specified  in  the  policy,  were, 
at  the  time  of  the  fire,  appropriated  to  carrying  on  a  grist-mill.  This  was  a  dis- 
tinct use  of  one  of  the  buildings  insured,  not  assented  to  by  the  defendants,  for 
an  occupation  included  in  the  classes  of  hazards,  annexed  to  the  policy,  as  a 
'special  hazard.'  It  was  therefore  a  violation  of  the  express  stipulation  in  the 
policy,  and  by  its  terms  avoids  the  contract.  Nor  does  it  at  all  affect  the  result, 
that  this  additional  unauthorized  use  of  the  premises  was  for  a  purpose  compre- 
hended within  the  same  class  of  hazards  as  that  which  was  specified  in  the  policy, 
and  originally  covered  by  the  insurance.  The  manifest  purpose  of  this  stipulalidu 
was  to  prevent  any  use  of  the  premises  for  an  occupation  or  business  inchuh-d  in 
any  of  the  classes  of  risks  denominated  '  hazardous,  extra-hazardous,  or  special,' 
without  the  express  sanction  of  the  company  in  writing.  It  was  not  intended  to 
limit  the  assured,  in  the  use  of  his  property,  to  the  same  kind  of  risks  as  those 
snecified  in  the  policy,  and  to  allow  him  to  change  the  mode  of  its  occupation,  or 

467 


§  238]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  XI. 

policy  on  a  spool-factory  is  to  be  voided  by  the  exercise  of 
any  business  denominated  hazardous  not  specially  allowed, 
the  manufacture  of  excelsior  (a  hazardous  business)  will  be 
fatal,  although  it  appears  by  the  evidence  to  be  less  hazard- 
ous than  the  making  of  spools,  and  did  not  increase  the 
risk.i] 

§  238.  Effect  of  General  Description  of  the  Stock.  —  In  Mas- 
sachusetts ^  it  is  also  held,  contrary  to  the  general  current  of 
the  authorities  elsewhere,^  that  an  insurance  on  a  building 
"  occupied  as  a  provision  and  grocery  store  "  becomes  void  by 
keeping  certain  prohibited  hazardous  articles,  though  within 
the  usual  line  of  goods  kept  in  such  a  store,  if  elsewhere  in 
the  policy  there  is  a  provision  against  keeping  any  articles 
denominated  hazardous  in  the  classified  risks.*     This  case 

appropriate  the  premises  to  additional  uses  of  the  same  grade  of  hazards,  at  his 
pleasure.  Such  is  not  the  import  of  the  language  used  in  the  policy,  nor  would 
such  a  construction  of  it  be  just  or  reasonable.  To  prevent  the  accumulations  of 
hazardous  occupations  in  the  same  premises,  without  their  assent,  was  the  object 
which  the  defendants  sought  to  accomplish  b}-  this  agreement.  Each  distinct  use 
of  a  building  insured  for  a  purpose  or  business  of  a  hazardous  nature  might,  in 
the  opinion  of  tlie  insurers,  increase  the  risk  by  fire;  and  this  might  be  so, 
whether  the  additional  use  came  within  the  same  kind  of  hazards  as  that  specified 
in  the  policy,  or  belonged  to  a  higher  or  lower  class." 

1  [Sovereign  Fire  Ins.  Co.  v.  Moir,  14  Can.  S.  C.  E.  612;  6  Russ.  &  Geld. 
(Nova  Sco.)  502.] 

■^  Whitmarsh  c.  Charter  Oak  Fire  Ins.  Co.,  2  Allen  (Mass.),  581  ;  citing  the 
la.st  case  and  also  ilacoraber  v.  Same,  ante,  §  233.  In  Whitmarsh  v.  Conway 
Fire  Ins,  Co.,  16  Gray,  359,  the  policy  expressly  covered  goods  usually  kept  in  a 
country  store. 

3  See  post,  §  239. 

*  Bigelow,  C.  J.,  said  in  2  Allen,  582  :  "The  policy  declared  on  contains  a 
stipulation  that  it  shall  cease  and  be  of  no  force  or  effect  if  the  assured  shall  keep 
on  the  premises  any  of  the  articles,  goods,  wares,  or  merchandise  denominated 
hazardous,  or  extra-hazardous,  or  included  among  the  special  hazards  enumerated 
in  the  memorandum  annexed  to  the  policy.  It  is  admitted  that  oil  and  sulphur, 
which  are  expressly  named  as  hazardous  articles,  and  matches,  which  are  deemed 
extra-hazardous,  and  all  of  which  subject  the  building  and  its  contents  to  an  in- 
creased rate  of  premium,  were  kept  on  the  premises  at  the  time  of  the  fire.  This 
was  a  clear  violation  of  the  stipulation  in  the  contract  of  insurance,  and  put  au 
end  to  it  ex  vi  termini.  It  is  urged,  on  behalf  of  the  plaintiff,  that  the  general 
description  in  the  application  and  the  policy  of  the  purpose  for  which  the  build- 
ing was  occupied,  'as  a  provision  and  gi'ocery  store,'  gives  the  right  by  implica- 
tion to  keep  these  hazardous  and  extra-hazardous  articles,  as  a  part  of  the  stock 
appertaining  to  such  business.  But  there  are  two  difficulties  in  the  way  of  adopt- 
ing such  an  interpretation  of  the  contract,  which  are  insurmountable.  In  the 
first  place,  it  militates  with  the  clear  and  unambiguous  terms  of  the  agreement. 

468 


CH.  XI.]      SPECIAL    PROVISIOXS    OF   THE    CO^^TRACT,    ETC.        [§  239 

has  been  followed  in  Virginia, ^  where  it  was  held  that  in- 
surance upon  a  "  stock  of  goods  such  as  is  usually  kept  in  a 
grocery  store"  did  not  cover  "burning  fluid,"  that  being 
elsewhere  in  the  policy  excepted  from  the  risk.  In  Tennes- 
see, also,  the  doctrine  has  been  held;  but  the  policy  prohib- 
ited "  vending, "  and  provided  that  "  the  use  of  general  terms, 
or  anything  less  than  a  distinct  specific  agreement,  clearly 
expressed  and  indorsed  on  the  policy,  shall  not  be  construed 
as  a  waiver  of  any  written  or  printed  condition  therein." 2 
So  in  Kansas,  where  the  policy  provided  that  no  excepted 
article  should  be  kept,  unless  upon  "  special  consent  in  writ- 
ing indorsed  on  the  policy,  naming  each  article  specially."^ 
§  239.  "What  Keeping  or  Use  avoids  the  Policy;  General 
"Written    Description  controls    the    Printed    Clauses.  —  And    it 

Hazardous  and  extra-hazardous  articles  are  expresslj'  prohibited,  '  if  not  specially 
provided  for.'  In  the  face  of  this  language,  it  is  impossible  to  hold  that  a  general 
descri^jtion  of  the  building,  and  the  purpose  for  which  it  is  occupied,  will  allow 
the  assured  to  keep  articles  of  a  dangerous  and  inflammable  nature,  which  are  not 
necessarily  comprehended  within  a  fair  and  reasonable  interpretation  of  the  gen- 
eral words  used.  In  the  next  place,  we  cannot  know,  judicially,  in  the  absence 
of  any  proof  or  agreement  of  the  parties,  that  such  articles  as  oil,  sulphur,  and 
matches  are  usually  or  properly  kept  in  stores  occupied  for  the  sale  of  groceries 
and  provisions."  This  case  may  have  been  well  decided  on  the  failure  of  proof; 
but  upon  the  other  point  it  certainly  gives  the  insurer  instead  of  the  insured  the 
benefit  of  a  doubt  ;  and,  if  carried  to  its  logical  results,  would  permit  insurers  to 
take  their  premiums  upon  a  building  covering  a  stock  of  goods,  the  keeping  of 
every  article  of  which  is  fatal  to  the  very  policy  which  professes  to  insure.  No 
one  can  suppose  that  any  person  seeking  insurance  would  ever  intentionally  make 
such  a  contract  as  that,  and  it  is  quite  clear  that  if  there  are  any  insurers  who 
would,  they  ought  not  to  receive  any  encouragement  in  a  court  of  justice.  If  they 
would,  it  would  be  a  gross  fraud.  If  they  would  not,  this  construction  need- 
lessly makes  for  the  parties  a  contract  which  neither  intended  to  enter  into. 
Suppose  a  building  occupied  as  a  livery-stable  is  insured  with  a  prohibition  of 
certain  hazardous  articles,  amongst  which  horses,  carriages,  and  hay  are  enumer- 
ated. See  ante,  §  174  ;  Van  Schoick  v.  Niagara  Ins.  Co.,  68  N.  Y.  434  ;  Collins 
V.  Farmville  Ins.  Co.,  79  N.  C.  279  ;  Washburn  v.  Miami,  &c.  Ins.  Co.,  C.  Ct. 
(Ohio),  2  Fed.  Rep.  633.  Such  a  provision  against  the  use  or  keeping  of  hazard- 
ous articles  does  not  apply  to  a  condition  requiring  a  statement  of  the  nature  of 
the  article  insured,  or  to  a  condition  that  in  case  of  other  insurance  only  a  pro- 
portionate part  shall  be  recovered,  or  to  a  condition  requiring  notice  if  the  premises 
shall  become  vacant,  —  there  being  conditions  having  special  reference  to  hazard- 
ous risks. 

1  Portsmouth  Ins.  Co.  v.  Brinckley  (Va.),  2  Ins.  L.  J.  842. 

2  People's  Ins.  Co.  v.  Kuhn,  12  Heisk.  515;  1  Central  L.  J.  214,  and  note  by 
Hon.  J.  0.  Pierce. 

3  Cobb  V.  Insurance  Co.  of  N.  A.,  11  Kans.  93. 

469 


§  239]  INSUKANCE  :    FIRE,    LIFE,    ACCIDENT,   ETC.  [CH.  XL 

may  be  stated  as  a  general  proposition  that  where,  in  the 
designation  of  the  subject-matter  of  insurance,   a  stock   of 
o-oods,  or  property  embarked  and  used  in  a  particular  trade 
or  manufacture,  or  any  branch  of  business,   is  stated  to  be 
insured  without  qualification  or  exception,  the  policy  covers 
all  such  special  articles  of  merchandise,  processes,  practices, 
subordinate  trades,  and  manufactures  as  are  necessarily  or 
usually  included  in  and  incidental  to  the  general  subject- 
matter  of  insurance,   notwithstanding  the   policy  may  pro- 
vide, by  a  general  printed  stipulation,  that  if  the  premises 
shall  be  used  for,  or  appropriated  or  applied  to,  the  storing 
or  vending  of  articles,  or  the  carrying  on  of  any  trade,  voca- 
tion,  or  business   denominated  hazardous,   extra-hazardous, 
or  enumerated  in  the  memorandum  of  special  rates,  the  pol- 
icy shall  be  void ;  and  such  included  and  incidental  matters 
are  within  the  excepted  specifications.     This  rule  is  based 
upon  the  presumed  intent  of  the  parties  that  the  entire  sub- 
ject-matter as  it  is,  and  as  it  must  necessarily  exist,  if  it 
exist  at  all,  with  all  its  incidents  and    without   essential 
changes,  is  to  be  protected, ^  and  upon  the  further  presump- 
tion that  the  written  special   description   of  the  particular 
subject-matter,   wherever   inconsistent  with  special  printed 
clauses,  must  control. ^     And  this  general  proposition  has 
been    established    and    illustrated    by   numerous    adjudged 
cases. 3     Thus,  though  the  trade  of  a  carpenter  is  excepted 

1  Delonguemare  j;.  Tradesmen's  Insurance  Company,  2  HaU  (N.  Y.Superior 
Ct.),  589. 

2  Jefferson  Ins.  Co.  v.  Cotheal,  7  Wend.  (N.  Y.)  72;  Goss  v.  Citizens'  Ins. 
Co.,  18  La.  An.  97  ;  Benedict  v.  Ocean  Ins.  Co.,  31  N.  Y.  389  ;  Phoenix  Ins.  Co. 
V.  Tajdor,  5  Minn.  492  ;  Citizens'  Ins.  Co.  v.  McLaughlin,  53  Pa.  St.  485  ;  Cush- 
man  v.  North  Western  Ins.  Co.,  34  Me.  487  ;  Moore  v.  Protection  Ins.  Co.,  29 
id.  97  ;  Leggett  v.  Mtna  Ins.  Co.,  10  Rich.  Law  (S.  C),  202  ;  Archer  v.  Mer- 
chants' Manuf.  Ins.  Co.,  43  Mo.  434  ;  James  v.  Lycoming  Fire  Ins.  Co.,  4  Cliff. 
C.  Ct.  (Mass.)  272. 

»  [A  policy  on  a  "general  store"  covers  such  quantities  of  gunpowder  and 
petroleum  as  can  be  shown  to  be  customarily  kept  in  such  store.  Barnard  v.  Nat. 
F.  Ins.  Co.,  27  Mo.  App.  26.  In  Kentucky,  however,  it  is  held  that  where  the 
printed  con(Utions  exclude  gunpowder,  the  mere  fact  that  it  is  usually  kept  as 
yiart  of  such  a  stock  as  is  insured,  or  that  the  agent  told  the  insured  he  could 
keep  gunpowder,  cannot  estop  the  company.  The  rule  against  parol  evidence 
applies.     Western  Ass.  Co.  v.  Rector,  85  Ky,  294.] 

470 


CH.  XI.]      SPECIAL    PROVISIONS    OF   THE   CONTEAGT,    ETC.        [§  239 

as  a  hazardous  trade,  yet  as  in  the  manufacture  of  china  a 
carpenter  is  usually  eni})loyed  in  the  factory,  and  works  with 
bench  and  tools  in  making  shelves,  mouldings,  boxes,  and 
racks,  in  furtherance  of  the  general  purpose  of  the  business, 
such  employment  will  not  avoid  a  policy  issued  "on  build- 
ings occupied  as  a  china  factory,  and  on  stock  finished  and 
unfinished  therein. "  Nor  is  the  employment  of  a  carpenter 
for  making  repairs  "carrying  on  the  trade"  of  a  carpenter. ^ 
But  a  keeping  for  sale,  as  of  saltpetre  by  a  butcher,  may  be 
fatal,  while  the  keeping  for  use  is  permissible. ^ 

So  an  insurance  of  a  "printing  business"  includes  all  that 
is  essential  in  conducting  such  business ;  and  if  camphene  is 
a  customary  and  necessary  article  used  in  such  business,  the 
keeping  of  that  article  is  permissible  under  the  policy, 
though  it  state  that  "the  company  will  not  be  liable  for  a 
loss  by  fire  occasioned  by  camphene  or  other  inflammable 
fluid,"  and  it  appear  that  the  fire  was  occasioned  by  the 
accidental  dropping  of  a  match  into  a  pan  of  camphene  while 
in  use.  3  And  the  same  is  true  under  a  like  insurance  and  a 
similar  cause  of  the  loss,  where  the  policy  provided  that 
"camphene,  spirit,  gas,  or  burning  fluid  cannot  be  used  in 
the  building  where  insurance  is  effected,  unless  permission 
for  such  use  be  indorsed  in  writing  on  the  policy,  and  is 
then  to  be  charged  an  extra  premium,"  though  no  such  per- 
mission was  indorsed  and  no  extra  premium  paid.  The  use 
of  camphene  thus  prohibited  was  held  to  be  its  use  for  the 
purposes  of  illumination,  and  not  a  use  in  the  processes  of 
the  business.*     To  take  benzine  upon  the  premises  for  the 

1  Delongueraare  o.  Tradesmen's  Ins.  Co.,  2  Hall  (N.  Y.),  589;  Lounsbuiy  w. 
Protection  Ins.  Co.,  8  Conn.  459  ;  Sims  t;.  State  Ins.  Co.,  47  Mo.  54  ;  "West- 
chester Fire  Ins.  Co.  v.  Foster,  8  lus.  L.  J.  596. 

2  Commercial  Ins.  Co.  v.  Mehlman,  48  111.  313. 

3  Harper  v.  City  Ins.  Co.,  22  K.  Y.  44"!  (see  post,  §  415),  affirminc;  s.  c.  1  Bosw. 
(X.  Y.  Superior  Ct.)  520  ;  Steinbach  v.  Lafayette  Fire  Ins.  Co.,  54  N.  Y.  90,  95  ; 
Hall  V.  Ins.  Co.  of  N.  A.,  58  id.  292. 

*  Harper  v.  Albany  Mat.  Ins.  Co.,  17  N.  Y.  194.  The  keeping  of  cam- 
phene for  sale  was  also  prohibited  in  the  policy.  Ditwiller  v.  Phceiiix  Fin'  Ins. 
Co.,  7  N.  Y.  (Sup.  Ct.)  530,  But  in  Putnam  v.  Com.  Ins.  Co.,  C  Ct.  (N.  Y.), 
23'  Alb.  L.  J.  239,  a  like  prohibition  of  keeping  or  using  naphtha  was  held  to  ad- 
mit of  its  use  for  illumination.  See  also  Buchanan  v.  Exchange  Ins.  Co.,  61  N.  Y. 
26  ;  Wheeler  v.  American,  &c.  Ins.  Co.,  Ct.  of  App.  (Mo.),  8  Ins.  L.  J.  318. 

471 


§  2;J9]         insurance:  fire,  life,  accident,  etc.        [ch.  xi. 

purpose  of  cleaning  the  machinery  is  not  "to  keep  and  have  " 
it  there,  which  words  are  intended  to  prevent  permanent  or 
habitual  storage  of  the  articles.^  So  "stock  in  trade"  of  a 
furniture  dealer  covers  paints,  oils,  and  varnishes  used  to 
finish,  though  in  answer  to  an  inquiry  it  was  stated  that  no 
explosive  or  highly  inflammable  matter  was  kept  on  the 
premises.^  So  a  policy  issued  upon  "stock  as  rope  manu- 
factures" or  "flax  factory"  covers  the  business  of  rope-mak- 
ing, though  that  business  is  excluded  as  specially  hazardous.^ 
But  a  "  store  house  "  cannot  be  used  for  hackling  hemp,  and 
spinning  it  into  rope  yarn.^ 

So  insurance  "  as  a  manufacturer  of  brass  clock  works  " 
permits  the  use  of  all  such  articles  as  are  ordinarily  em- 
ployed in  that  manufacture,  and  the  keeping  them  on  hand, 
and  even  the  making  them  for  that  purpose,  if  such  be  the 
ordinary  course  of  the  business,  although  the  use  or  keeping 
of  such  articles  be  prohibited  by  the  printed  terms  of  the 
policy  as  extra-hazardous.^  So  where  the  written  portion 
of  the  policy  insured  a  steam-engine,  but  the  printed  condi- 
tion excepted  losses  "  caused  by  or  consequent  on  the  burst- 
ing or  collapsing  of  a  steam-boiler  or  steam-pump,"  it  was 

1  Mears  v.  Humboldt  Ins.  Co.  (Pa.),  9  Ins.  L.  J.  139.  In  Morse  v.  Buffalo 
Fire  &  Marine  Insurance  Company  the  use  or  keeping  of  "  camphene,  spirit,  gas, 
naplitha,  benzine  or  benzole,  chemical,  crude,  or  refined  coal  or  earth  oils," 
was  prohibited  ;  and  it  was  held  that,  applying  the  maxim  noscitur  a  sociis,  only 
those  refined  oils  that  were  inflammable,  like  naphtha,  &c.,  and  equally  danger- 
ous, were  prohibited,  and  that  kerosene,  not  being  of  such  a  dangerous  charac- 
ter, was  permitted.  Whether  a  given  article  not  specified  in  the  policy  is 
within  the  scope  of  the  term  "inflammable"  or  "  explosive,"  or  has  any  other 
special  quality,  is  for  the  jury.  Willis  v.  Gerraania,  &c.  Ins.  Co.,  79  N.  C.  285  ; 
Wood  V.  North  Western  Ins.  Co.,  46  N.  Y.  421  ;  Putnam  v.  Com.  Ins.  Co.,  C.  Ct. 
(N.  Y.),  23  Alb.  L.  J.  239  ;  Hicks  v.  Empire  Ins.  Co.  (Mo.),  St.  Louis  Ct.  of 
App.,  8  Ins.  L.  J.  319.  So  if  the  place  be  a  "  building,"  or  the  process  a  "  manu- 
facturing." Stovall  V.  Fireman's  Ins.  Co.  (Md.),  Sup.  Ct.  Bait.,  9  Ins.  L.J.  160. 
A  building  fifty  feet  from  another  cannot  be  said  to  be  "  contiguous."  The  term 
implies  close  proximity.     Arkell  v.  Commerce  Ins.  Co.,  69  N.  Y.  191. 

2  Haley  v.  Dorchester  Fire  Ins.  Co.,  12  Gray  (Mass.),  546. 

3  Wall  V.  Howard  Ins.  Co.,  14  Barb.  (N.  Y.)  383.  It  seems  that  "hackling 
hemp  and  spinning  it "  is  not  "  rope-making."  Ibid.;  Aurora  Fire  Ins.  Co.  r. 
Eddy.  55  111.  213,  222. 

*  Wall  V.  East  River  Ins.  Co.,  7  N.  Y.  370. 

6  Bryant  v.  Poughkeeijsie  Mut.  Ins.  Co.,  21  Barb.  (N.  Y.)  154  ;  s.  c.  17  N.  Y. 
200. 

472 


CH.  XI.]     SPECIAL    PKOVISIONS    OF   THE   CONTRACT,    ETC,         [§  239 

held  that,  there  being  a  repugnancy  between  the  written  and 
printed  portions  of  the  policy,  the  written  portion  must 
prevail,  1(a) 

So  "  goods  usually  kept  in  a  country  store  "  covers  clean 
white  cotton  rags,  it  being  shown  that  such  rags  usually 
form  part  of  the  stock  of  country  stores,  though  in  the  appli- 
cation, which  was  made  part  of  the  contract,  the  question 
whether  "  cotton  or  woollen  waste  or  rags  "  were  kept  in  or 
near  the  premises  was  answered  in  the  negative. ^  (5)  So  a 
policy  on  "such  goods  as  are  kept  in  a  general  retail  store, "^ 
or  "the  usual  variety  of  a  country  store,"*  covers  such  an 

1  Hayward  v.  North  Western  Ins.  Co.,  ]9  Abb.  Pr.  (N,  Y.)  116.  But  see 
Hayward  v.  Liverpool,  &c.  Ins.  Co,,  2  Abb.  App.  Dec.  349  ;  Evans  v.  Columbian 
lus.  Co.,  44  X.  Y.  146. 

2  Elliot  V.  Hamilton  Mut.  Ins.  Co.,  13  Gray  (Mass,),  139.  This  case,  how- 
ever, was  rather  one  of  representation,  and  turned  upon  the  point  that  "  cot- 
ton or  woollen  waste  or  rags "  referred  to  waste  or  oily  rags,  such  as  are  easily 
inHammable,  rather  than  clean  white  rags. 

3  Phcenix  Ins.  Co.  v.  Taylor,  5  Minn.  492  ;  ante,  §  233. 

*  Whitmarsh  v.  Conway  Fire  Ins.  Co,,  16  Gray  (Mass.),  359. 


(a)  If  benzine  is  insured  in  writing 
in  a  policy,  as  part  of  a  merchant's 
stock,  .such  written  clause  prevails  over 
a  printed  clause  in  the  policy  forbidding 
it  to  be  kept.  Phoenix  Ins,  Co.  v. 
riemining,  65  Ark.  54 ;  Russell  v. 
Manufacturers'  &  Builders'  F.  Ins.  Co., 
50  Minn.  409  ;  see  also  Faust  v.  Ameri- 
can F.  Ins.  Co.,  91  Wis,  158;  Boyd 
V.  Mississippi  Home  Ins,  Co.,  75  Miss, 
47;  Maril  v.  Conn,  F,  Ins.  Co.,  95 
Ga.  604  ;  supra,  %  144  D,  and  note  (a), 
(b)  So  under  a  polic)'  upon  goods 
"such  as  are  usually  kept  in  country 
stores,"  and  providing  in  print  that  it 
shall  be  void  if  benzine  and  other  in- 
flammable substances  are  kept  without 
consent,  the  insured  may  prove  that  his 
goods  were  such  as  are  usual  in  country 
stores.  Tubb  v.  Liverpool,  &c.  Ins, 
Co.,  106  Ala.  651. 

The  knowledge  and  assent  of  the  in- 
surer's local  agent  as  to  the  erection  of 
a  gasoline  plant  on  the  insured  property 
after  the  delivery  of  the  policy,  and  the 
failure   of  the   insurer    to    cancel   the 


polic}',  do  not  limit  the  insurer's  rights 
to  insist  upon  a  promissory  warranty  as 
to  gasoline.  West  End  Hotel  &  Land 
Co.  V.  American  F.  Ins.  Co.,  74  Fed, 
Rep.  114  ;  see  Laclede  Fire-Brick 
Manuf,  Co,  v.  Hartford,  &c.  Ins,  Co., 
60  id.  351.  So  the  mere  knowledge  of 
the  insurer  that  a  promissory  warranty 
that  a  clear  space  of  one  hundred  feet 
shall  be  maintained  between  the  insured 
propert}'  and  any  woodworking  or 
manufacturing  establishment,  is  not 
observed,  and  its  failure  to  object 
thereto,  do  not  avoid  a  forfeiture  for 
this  cause.  Petit  v.  German  Ins.  Co., 
29  Ins,  L.  J,  255  ;  see  Michigan  Shingle 
Co.  V.  State  Inv,  &  Ins.  Co.,  94  Mich. 
389  ;  Collins  v.  North  British  I\Ierc. 
Ins.  Co.  (Mich.),  76  N.  W.  487  ;  Mer- 
chants' Ins.  Co.  V.  New  Mexico  Lumber 
Co.,  10  Col.  App.  223;  Liverpool,  &c. 
Ins.  Co.  V.  Farnsworth  Lumber  C^.,  72 
Miss.  555  ;  McCormick  v.  Royal  Ins. 
Co.,  163  Penn.  St.  184;  James  v. 
Ins.  Co.  of  North  America,  90  Tenn. 
604. 

473 


§239]         insurance:  fire,  life,  accident,  etc.       [ch.  XL 

ainuunt  of  gunpowder,  matches,  or  other  hazardous  articles 
as  is  usually  kept  for  sale  in  such  a  store,  though  excepted 
by  the  printed  condition  of  the  policy  from  being  deposited, 
stored,  or  kept.  [Evidence  of  the  usage  of  merchants  may 
be  introduced  to  show  that  gunpowder  comes  within  the  fair 
and  understood  meaning  of  the  words  used  to  describe  the 
risk  as  "general  stock  of  merchandise,"  or  "dry  goods  and 
groceries."^]  "Oils  and  other  spirituous  liquors  "  may  be 
kept  by  a  "grocer,"  the  business  of  a  grocer  not  being  spe- 
cified in  the  memorandum  of  excepted  risks,  though  the  spe- 
cific articles  are.^  So  a  policy  on  a  stock  of  "dry  goods" 
covers  cotton  in  bales,  if  ordinarily  a  portion  of  such  a 
stock,  though  the  latter  are  enumerated  as  extra-hazardous.^ 
And  it  seems  that  a  housekeeper  may  keep  such  articles  as 
are  incidental  to  house-keeping.*  But  gunpowder  is  not 
included  in  a  "general  stock  of  iron  and  hardware,"^  nor  is 
"hat  bleaching"  any  part  of  the  dry-goods  business.^  In- 
surance on  a  " steam-fiouring  mill"  covers  and  permits  a 
corn-mill  in  connection  with  a  kiln  for  drying  corn  meal,  if 
they  are  a  usual  or  appropriate  part  of  the  business  insured.^ 
[When  a  policy  insured  against  fire  on  a  photographer's 
stock,  it  was  held  to  cover  such  materials  as  were  neces- 
sarily and  ordinarily  used  in  that  business,  although  by  the 
printed  clause  of  the  policy  the  keeping  or  use  of  such  mate- 
rials was  prohibited.^]  But  the  introduction  of  coopering 
into  an  unused  flour-mill  and  a  prosecution  for  months  of 
the  business  are  an  appropriation  to  another  purpose,  and, 
if  it  increases  the  risk,  avoids  the  policy.^  'Nor  does  the 
insurance  of  a  stock  of  "  cabinet  wares  "  permit  the  use  of 

1  [Liverpool,  &c.  Ins.  Co.  v.  Van  Os,  63  Miss.  431,  442.] 

2  New  York  Equitable  Ins.  Co.  v.  Langdon,  6  Wend.  (N.  Y.)  623. 

3  Moore  v.  Prot.  Ins.  Co.,  29   Me.  97 ;  Germania  Fire   Ins.  Co.  v.  Francis,  52 
Miss.  457  ;  Collins  v.  Farmville  Ins.  Co.  (N.  C),  8  Ins.  L.  J.  453. 

*  Ph(jenix  Ins.  Co.  v.  Slaughter,  12  Wall.  (U.  S.)  404  ;  Aurora  Fire  Ins.  Co. 
V.  Eddy,  55  111.  222  ;  Reaper  City  Fire  Ins.  Co.  v.  Jones,  62  111.  458. 

5  Mason  v.  Hartford  Fire  Ins.  Co.,  29  U.  C.  (Q.  B.)  585. 

6  Merrick  v.  Provincial  Ins.  Co.,  14  U.  C.  (Q.  B.)  439. 

^  Wash.  Mut.  Ins.  Co.  v.  Merch.  &  Manuf.  Ins.  Co.,  5  Ohio  St.  450. 

8  [Hall  V.  Ins.  Co.  of  N.  A.,  58  N.  Y.  292,  294.] 

^  Harris  v.  Columbiana  Mut.  Ins.  Co.,  4  Ohio  St.  285. 

474 


CH.  XI.]    SPECIAL    PROVISIONS    OF   THE    CONTRACT,   ETC.   [§  239  A 

the  premises  in  putting  chairs  together,  the  parts  of  which 
are  elsewhere  manufactured,  nor  the  use  of  alcohol,  paint, 
and  varnish  in  the  process,  the  policy  prohibiting  any  trade 
or  occupation  and  the  keeping  of  such  articles.  Such  a  pol- 
icy covers  only  finished  articles,  and  not  at  all  any  process 
of  manufacture  or  completion. ^  Making  brooms  in  a  build- 
ing does  not  constitute  it  a  manufactory,  nor  does  the  grind- 
ing of  corn  in  it  necessarily  make  it  a  mill.  The  words  are 
to  be  taken  in  their  common  signification  as  describing  a 
certain  kind  of  property,  commonly  regarded  as  a  mill  or 
manufactory. "-^  So  where  the  condition  was  that  "applica- 
tions for  insurance  on  manufactories  where  steam  is  used 
must  be  approved  at  the  head  office,"  it  was  held  not  to  apply 
to  a  vacant  distillery,  which  it  was  not  contemplated  to  put 
in  operation.  3  And,  generally,  if  the  use,  or  trade,  or 
article  kept  on  storage  or  for  sale,  is  not  incidental  to  that 
which  is  the  subject-matter  o£  insurance,  the  policy  not  only 
does  not  cover  it,  but  is  void.* 

[§  239  A.  Gasoline  ;  Petroleum  ;  Gin  ;  Turpentine.  —  Light- 
ing with  gasoline  is  not  devoting  the  premises  to  a  more 
hazardous  business.^  A  prohibition  against  keeping  petro- 
leum, or  "  refined  coal  and  earth  oils  "  is  broken  by  keeping 
gasoline.^  (a) 

1  Appleby  v.  Astor  Ins.  Co.,  54  IST.  Y.  253. 

2  Frankliu  Fire  Ins.  Co.  v.  Brock,  57  Pa.  St.  74. 

*  Rowe.  V.  London,  &c.  Ins.  Co.,  12  Grant's  Ch.  (N.  C.)  311. 

*  As  to  property  covered  by  policy,  see  post,  §  420. 

5  [Milt.  Fire  Ins.  Co.  v.  Coatesville  Shoe  Factory,  80  Pa.  St.  407.] 

6  [King's  Co.  Fire  Ins.  Co.  v.  Swigert,  11  Brad,  590.] 

{a)    In  the  clause  of  a  policy  provid-  54  Kansas,  732.     A  condition  of  a  fire 

ing  that  it  shall  be  void  if  gasoline  "  be  policy  upon  a  furniture  factory  against 

kept,  used,  or  allowed  "  on  the  premises,  benzine  being  kept,  used,  or  allowed  on 

the  word    "allowed"  means  "  allowed  the   premises   is   not   broken    by   .such 

to  be  kept  or  used."    London  &  L.  Fire  keeping  and  use  there  of  benzine  as  is 

Ins.  Co.  y.  Fischer,  92   Fed.   Rep.  500,  necessary  and  customary  in  the  business 

502  ;  see  McFarland  v.  St.   Paul   F.  &  of  manufacturing  furniture,  or  by  the 

Ins.  Co.,  46  Minn.  519.     The  policy  is  occasional  use  of  it  in  small  quantities, 

avoided  for  this  cause  when  the  fire  is  Faust  v.  American  F.  Ins.  Co.,  91  Wis. 

caused  by  gasoline  kept  by  a  third  per-  158;  Davis  v.   Pioneer  Furniture  Co., 

son  in  the  insured   building  with  the  102  Wis.  394*:    Lancaster  Silver  Plate 

insured's   express   or   implied   consent.  Co.  v.  ISTational   F.  Ins.  Co.,  170  Penn. 

German    F.   Ins.  Co.  v.  Commissioners,  St.  151  ;  Wheeler  v.  Traders'  Ins.  Co., 

•475 


§  239  A]       INSURANCE :    FIRE,   LIFE,    ACCIDENT,  ETC.  [CH.  XI. 

Although  among  the  articles  forbidden  by  a  policy  on  a 
"manufacturing  establishment,"  if  petroleum  is  kept  and 
used  to  lubricate  the  machinery  in  a  reasonable  and  proper 
manner,  and  it  is  shown  to  be  an  appropriate  and  customary 
article  for  such  purposes,  the  policy  is  not  broken,  i  When 
the  assured  supposed  that  he  was  using  "  lard  and  sperm  oil " 
as  per  the  policy,  the  mere  fact  that  some  petroleum  was 
used  in  compounding  it  unknown  to  him  would  not  be  a 
breach  of  the  condition  2  allowing  only  lard  and  sperm  oil 
as  lubricators,  if  in  fact  the  petroleum  mixture  was  equally 

1  [Carlin  v.  West  Ass.  Co.,  57  Md.  515,  529.] 

2  [Copp  V,  German  American  Ins.  Co.,  51  Wis.  637,  641.] 


62  N.  H.  450  ;  Ran  v.  Westchester  F. 
Ins.  Co.,  55  N.  Y.  S.  459  ;  Hanover  F. 
Ins.  Co.  V.  Stoddard,  52  Neb.  745 ; 
Bentley  v.  Lumbermen's  Ins.  Co.,  191 
Peun.  St.  276.  So  insurance  upon  an 
uncompleted  building  authorizes  its  use 
in  any  common  business  to  which  its 
construction  is  adapted,  and  a  policy 
which  merely  prohibits  the  storing  of 
dangerous  articles  therein  does  not  pro- 
hibit keeping  them  for  sale  in  such 
business.  Renshaw  v.  Missouri  State 
Mut.  F.  &  M.  Ins.  Co.,  103  Mo.  595, 
605  ;  Phoenix  Ins.  Co.  v.  Flemming, 
65  Ark.  541.  The  single  negligent  act 
of  building  a  stove  fire  by  adding  a  half- 
pint  of  kerosene  oil,  whereby  the  build- 
ing is  destroyed,  is  not  an  "  increase  of 
hazard."  Angler  v.  Western  Ass.  Co., 
10  So.  Dak.  82  ;  66  Am.  St.  Rep.  684, 
691,  and  extended  note.  See  White  v. 
Royal  Ins.  Co.,  149  N.  Y.  485.  The 
word  "  kept,"  as  used  in  a  policy  of  in- 
surance which  provides  that  it  shall  be 
void  if  certain  oils  and  burning  fluids 
shall  be  kept  on  the  premises,  implies 
a  use  of  the  premises  as  a  place  of  de- 
posit for  the  prohibited  articles  for  a 
considerable  time,  and  where,  while  a 
naphtha  torch  was  being  used  to  burn 
off  the  old  paint  preparatory  to  repaint- 
ing, the  building  caught  fire  and  was 
entirely  consumed,  the  question  was 
whether  such  a  change  of  use,  increas- 
ing the  risk  with  the  agency  and  consent 

476 


of  the  insured,  was  an  alteration  of 
"  the  situation  or  circumstances  affect- 
ing the  risk  "  within  the  meaning  of  the 
policy,  it  was  held,  that,  as  the  change 
had  existed  continuously  during  the 
working  hours  of  every  day  for  nearly  a 
month,  and  the  work  was  not  nearly 
done  when  it  was  interrupted  by  fire, 
the  change  of  condition  was  so  long  con- 
tinued as  to  amount  to  a  change  in  '  the 
situation  or  circumstances  affecting  the 
risk."  First  Congregational  Church  v. 
Holyoke  Mut.  F.  Ins.  Co.,  158  Mass. 
475.  See  Smith  v.  German  Ins.  Co., 
107  Mich.  270.  As  to  restrictions  upon 
the  use  of  "  dangerous  or  inflammable 
substances,"  such  as  kerosene  or  chemi- 
cal oils,  camphene,  &c.,  see  also  Lancas- 
ter Silver  Plate  Co.  v.  Manchester  F. 
Ass.  Co.,  170  Penn.  St,  166  ;  Renshaw 
V.  Missouri  State  Mut.  F.  &  M.  Ins. 
Co.,  103  Mo.  595;  23  Am.  St.  Rep. 
904,  and  note  ;  Maril  v.  Conn.  F. 
Ins.  Co.,  95  Ga.  604  ;  Grand  Rapids 
Hydraulic  Co.  v.  American  F.  Ins.  Co., 
93  Mich.  396;  Pool  v.  Milwaukee 
Mechanics'  Ins.  Co.,  91  Wis.  530  ; 
Snyder  v.  Dwelling-House  Ins.  Co.,  59 
N.  J.  L.  544;  59  Am.  St.  Rep.  625,  and 
note.  As  to  portable  engines,  see  Far- 
mers' Mut.  F.  Ins.  Co.  V.  Schaeffer,  82 
Md.  377  ;  Morris  v.  Farmers'  Mut.  F. 
Ins.  Co.,  63  Minn.  420  ;  Davis  v.  West- 
ern Home  Ins.  Co.,  81  Iowa,  496. 


CH.  XI.]      SPECIAL   PROVISIONS   OF   THE    CONTRACT,   ETC.    [§  239  B 

as  good  and  safe  as  pure  lard  and  sperm  oil.  "Where  the 
policy  grants  the  use  of  kerosene  for  lamps  to  be  filled  by 
daylight  only,  the  drawing  of  the  oil  by  lamplight  to  loan 
to  a  neighbor,  causing  an  explosion,  avoids  the  policy.^ 
Where  a  policy  provided  that  kerosene  might  be  used  for 
light  in  dwellings,  and  kept  for  sale  in  stores,  and  where  it 
appeared  that  a  kerosene  lamp  was  kept  burning  in  the  store 
during  the  night,  and  that  the  clerk  and  proprietor  slept  in 
a  back  room  of  the  store,  the  policy  was  held  void,  the  loss 
being  occasioned  by  the  said  lamp.^  The  said  use  of  the 
store  did  not  constitute  it  a  dwelling  so  as  to  escape  the 
clause  of  the  policy  prohibiting  the  use  of  kerosene  in 
the  store.  The  court  will  not  judicially  recognize  that  gin 
and  turpentine  are  "  inflammable  liquids. "  ^] 

[§  239  B.  Gunpowder;  Fireworks,  &c.  —  Where  the  in- 
sured is  allowed  to  keep  only  seventy-five  pounds  of  gun- 
powder for  sale,  the  mere  casual  or  accidental  presence  of 
more  will  not  avoid  the  policy.*  Whether  "gunpowder" 
includes  blasting  powder,  qncere.^  A  policy  which  forbids 
nitroglycerine,  excludes  dynamite  and  giant  powder.®  Where 
the  policy  insured  "goods  and  groceries"  and  provided  that 
no  gunpowder  should  be  kept  "in  or  upon  the  premises"  in- 
sured, and  that  no  camphene,  or  burning  fluid  or  other  in- 
flammable liquids  should  "be  kept  in  any  building  hereafter 
insured  in  this  company,"  it  was  held  that  "premises"  and 
"  building "  did  not  refer  to  "  goods  and  groceries  "  but  to 
real  estate,  and  if  gunpowder  and  so  forth  were  kept  on 
premises  not  insured  the  policy  on  the  "goods"  was  not 
affected."  The  keeping  of  fireworks  is  not  a  breach  of  the 
condition    against    keeping    gunpowder   on   the    premises.^ 

1  [Giinther  v.  Liverpool,  &c.  Ins.  Co.,  34  Fed.  Rep.  501  (N.  Y.),  1888.] 

2  [Cerf  V.  Home  Ins.  Co.,  44  Cal.  320,  322.] 

8  [Mosley  v.  Vt.  Mut.  Fire  Ins.  Co.,  55  Vt.  142.] 

*  [Insurance  Co.  v.  Hughes,  10  Lea  (Tenn.),  46L  The  proof  was  conflicting 
whether  there  was  a  little  more  or  a  little  less  than  seventy-five  pounds  of  powder 
in  the  store.     It  does  not  appear  that  the  powder  occasioned  the  fire.] 

5  [Insurance  Co.  v.  Hughes,  10  Lea  (Tenn.),  461,  467-468.] 

6  [Sperry  v.  Springfield  Fire  &  Mar.  Ins.  Co.,  26  Fed.  Rep.  234  (Col.),  1SS6.] 
'  [Mosley  v.  Vt.  Mut.  Fire  Ins.  Co.,  55  Yt.  142.] 

8  [Tischler  v.  Cal.  Farmers'  Mut.  Fire  Ins.  Co.,  66  Cal.  178.] 

477 


§  240]  INSURANCE  :    riEE,   LIFE,   ACCIDENT,   ETC.  [CH.  XI. 

EviUcnce  is  admissible  to  show  that  fireworks  conslitnte  an 
ordinary,  usual,  and  recognized  portion  of  a  stock  of  fancy 
goods  and  Yankee  notions.  A  policy  insuring  such  a  stock 
is  not  avoided  by  keeping  fireworks  although  they  are  classed 
as  "specially  hazardous,"  and  it  was  specified  that  this  class 
to  be  covered  must  be  specially  written  in  the  policy. ^  Fire- 
works are  not  included  in  "family  groceries,  wines,  liquors, 
tobacco,  and  cigars.  "^J 

§  240.  Working  of  Carpenters;  Repairs,  — Upon  the  same 
general  principles,  when,  from  the  character  of  the  building 
insured,  and  the  use  made  of  it,  it  is  necessary  to  have 
workmen  constantly  engaged  in  repairing,  in  order  to  keep 
it  in  proper  condition  for  the  business  done  therein,  the  em- 
ployment of  such  workmen  is  not  a  breach  of  the  condition 
that  "working  of  carpenters,"  <fec.,  altering  or  repairing, 
will  vitiate  the  policy,  (a)  Such  condition  has  for  its  object 
to  prohibit  such  hazardous  use  as  is  generally  denominated  a 
"builder's  risk,"  which  arises  from  placing  the  building 
in  the  possession  or  under  the  control  of  workmen  for  alter- 
ation or  repairs,  but  does  not  refer  to  such  indispensable 
repairs  as  are  necessary  to  the  proper  conduct  of  the  busi- 

1  [Barnum  v.  Merchants'  Fire  Ins.  Co.,  97  N.  Y.  188.] 

2  [Georgia  Home  Ins.  Co.  v.  Jacobs,  56  Tex.  366.] 

(fl)  Alterations  and  repairs  in  a  Holyoke  M.  F.  Ins.  Co.,  158  Mass.  475; 
building,  to  be  material  to  the  risk,  Stauffer  v.  Manheim  M.  F.  Ins.  Co.,  150 
mnst  be  of  a  permanent  nature.  Adair  Penn.  St.  531;  Newport  Ins.  Co.,  v. 
V.  Southern  Mut.  Ins.  Co.,  107  Ga.  297.  Home  Ins.  Co.,  163  N.  Y.  237  ;  Mechan- 
In  Imperial  F.  Ins.  Co.  v.  Coos  County,  ics'  Ins.  Co.  u.  Hodge,  149  Til  298  ;  Fire- 
151  U.  S.  452,  a  policy  which  contained  men's  Ins.  Co.  v.  Appleton  Paper  Co.,  161 
the  express  provision  that  it  should  be  111.  9  ;  Manufacturers'  Ins.  Co.  v.  Arm- 
void  if  "mechanics  are  employed  in  strong,  145  111.  469  ;  Schaefferr.  Farmers' 
building,  altering,  or  repairing  the  prem-  Ins.  Co.,  80  Md.  563  ;  Monteleone  v. 
ises"  without  consent,  was  held  avoided  Koyal  Ins.  Co.,  47  La.  An.  1563  ;  Lim- 
by  the  eftiployment  of  mechanics  for  six  burg  v.  German  F.  Ins.  Co.,  90  Iowa,_  709 ; 
weeks  in  basement  repairs,  which  were  Phenix  Ins.  Co.  v.  Coomes  (Ky. ),  20  S. 
fully  completed  before  the  fire,  irrespec-  W.  900.  Consent  to  vacancy  does  not 
tive  of  the  question  whether  there  was  include  consent  to  repairs.  Hill  «.  Com- 
an  increase  of  risk.  S"e  also  Hill  v.  mercial  Union  Ins.  Co.,  164  Mass.  406. 
Middlesex  Mut.  Ass.  Co.,  174  Mass.  542.  A  tenant's  insurance  of  goods  by  a  policy 
As  to  repairs  and  alterations,  see  Lou-  which  allows  limited  repairs  to  realty 
don  Ass.  Co.  v  Drennen,  116  U.  S.  461  ;  does  not  apply  to  the  owner's  repairs  on 
California  Ins.  Co.  v.  Union  Compress  the  building.  Mechanics'  Ins.  Co.  v. 
Co.,  133  U.  S.  387 ;  First  Cong.  Church  v.  Hodge,  149  111.  298. 
478 


CFI.  XT.]      SPECIAL    PRO^aSIONS    OF   THE    CONTRACT,   ETC.        [§  241 

ness  to  which  the  building  is  appropriated.  ^  [Employing 
carpenters  to  make  extensive  alterations  is,  however,  a 
breach  of  condition. ^J 

§  241.  Use  means  Habitual  Use.  —  Use  for  any  purpose 
prohibited  means  habitual  use.^(a)  Insurance  on  a  building 
where  "no  fire"  is  kept  and  no  hazardous  goods  are  classed 
is  as  if  the  clause  read  "usually"  kept  and  deposited.^  The 
introduction  of  a  tar  barrel,  and  lighting  a  fire  for  the  pur- 
pose of  repairing  the  building  insured,  is  not  in  contraven- 
tion of  the  terms  of  a  policy  which  provides  that  fire  shall 
not  be  kept  nor  hazardous  goods  deposited  on  the  premises.^ 
Nor  is  insurance  upon  a  "kiln  for  drying  corn  in  use"  viti- 
ated by  the  fact  that  the  insured  in  a  single  instance  allowed 
the  cargo  of  a  vessel  laden  with  bark,  which  had  sunk  near 
by,  to  be  dried  at  the  kiln.  It  is  not  a  change  of  business 
in  the  sense  of  the  terms  of  the  policy,  which  means  perma- 
nent change.^  Repairing  the  building  insured  by  the  ordi~ 
nary  methods,  and  occupying  it  for  that  purpose,  is  not  an 
appropriation,  use,  or  application  thereof  for  carrying  on  a 

1  Frankliu  Fire  Ins.  Co.  v.  Chicago  Ice  Co.,  36  Md.  102.  See  also  ante,  §  224  ; 
post,  §  241. 

2  [Mack  V.  Rochester  German  Ins.  Co.,  106  N.  Y.  560.] 

^  [Insurance  Co.  v.  Hughes,  10  Lea  (Tenn.),  461  ;  Humboldt  Fire  Ins.  Co.  v. 
Menvs,  1  Pennypacker,  513.  But  a  single  occasion  of  use  is  sufficient  if  loss 
thereby  results.  When  a  policy  excej)ted  liability  for  loss  occasioned  by  kerosene, 
&c.  oils,  and  the  barn  was  destroyed  by  carrying  a  lamp  so  filled  therein,  it  was 
held  that  the  company  was  not  liable.  Matson  v.  Farm  Buildings  Insurance  Co., 
73  N.  Y,  310,  313.  Whether  "keep  or  use  "  means  on  a  single  occasion  or  con- 
tinuously, depends  on  the  circumstances.  A  vial  of  naphtha  in  the  pocket  of  one 
working  in  the  mill,  or  a  drop  taken  there  as  medicine,  might  not  create  any 
appreciable  hazard,  but  a  keeping  or  use  which  involves  the  mill  in  substantial 
danger  terminates  the  risk.  Wheeler  y.  Insurance  Co.,  62  N.  H,  326.  In  this 
case  the  insured  bought  what  he  supposed  was  benzine  to  kill  moths.  It  was 
really  naphtha.  He  sprinkled  it  on  the  wool  in  his  mill,  and  a  few  hours  after  a 
fire  broke  out.     The  policy  was  held  void.] 

4  Dobson  V.  Sotheby,  1  Moo.  &  Mai.  90;  Barrett  v.  Jermy,  3  Wels.,  Hurl.  & 
Gor.  (Exch.)  535  ;  Leggett  v.  iEtna  Ins.  Co.,  10  Rich.  Law  (S,  C),  202  ;  Insur- 
ance Co.  of  N.  A.  V.  McDowell,  50  111.  120. 

6  Dobson  V.  Sotheby,  1  Moo.  &  Mai.  90 ;   s.  c.  22  E.  C.  L.  481. 

«  Shaw  V.  Robberds,  6  Adol.  &  Ell.  75  ;  s.  c.  33  E.  C.  L.  12. 

{n)  As  to  increase  of  risk  by  the  church  to  other  uses,  see  School  District 
unauthorized  change  of  a  schoolhouse  or     v.  German  Ins.  Co.,  7  So.  Dak.  458. 

479 


§  242]  INSURANCE  :    FIEE,    LIFE,   ACCIDENT,   ETC.  [CH.  XI. 

trade  or  business  of  house  building  or  repairing.^  Nor  is 
the  making  a  fire  therein  for  the  purpose  of  extracting  fat 
from  spoiled  meat.^  The  mixing  and  keeping  of  paints  in 
the  barn,  by  the  insured,  for  the  purpose  of  painting  his  house, 
is  an  ordinary  and  permissible  use  of  the  barn,  although 
it  is  described  as  used  for  "hay,  straw,  grain  unthrashed, 
stabling,  and  shelter."^  In  an  insurance  upon  a  house  in 
process  of  building,  a  statement,  in  reply  to  an  inquiry,  that 
there  are  no  stoves  in  it,  means  that  no  stove  is  to  be  habit- 
ually kept  and  used  in  it  as  stoves  are  ordinarily  used  in  a 
dwelling-house.  The  use  of  a  stove  for  a  few  days  subse- 
quent to  the  effecting  of  the  insurance,  and  for  a  purpose 
connected  with  the  finishing  of  it,  is  no  violation  of  the 
warranty,^  or  of  a  condition  against  alteration  in  use.^  The 
casual  use  of  camphene  and  friction-matches  by  workmen 
employed  about  the  premises,  without  the  knowledge  of  the 
insured  and  contrary  to  his  orders,  is  no  violation  of  a  pro^ 
viso  that  they  shall  not  be  kept,  used,  or  sold.  A  use  to 
work  forfeiture  must  be  a  use  known  to,  and  permitted  by, 
the  insured.^  The  occasional  use  of  articles  denominated 
hazardous,  or  the  occupation  of  the  premises  insured  for 
purposes  called  hazardous,  in  the  conditions  annexed  to  a 
policy,  will  not  avoid  the  policy  if  such  use  and  occupation 
appertain  to  the  general  subject-matter  of  the  risk.^ 

§  242.  Storing.  —  "  Storing "  has  been  defined  to  mean 
"keeping  for  safe  custody^  to  be  delivered  out  again  in  the 
same  condition,  substantially,  as  when  receiyed,"  and  to 
apply  only  when  the  storing  or  safe-keeping  is  for  trading 
purposes,  and  is  the  sole  or  principal  object  of  the  deposit, 

1  O'Niel  V.  Buffalo  Fire  Ins.  Co.,  3  Comst.  (N.  Y.)  122  ;  Grant  v.  Howard, 
5  Hill  (N.  Y.),  10. 

2  Gates  V.  Mad'ison  County  Mut.  Ins.  Co.,  5  N.  Y.  469. 

8  Billings  V.  Tolland  County  Mut.  Fire  Ins.  Co.,  20  Conn.  139. 
*  "Williams  v.  New  England  Mut.  Fire  Ins.  Co.,  31  Me.  219;  Barrett  v.  Jermy, 
3  Wels.,  Hurl.  &  Gor.  (Exch.)  535. 

5  Troy  Fire  Ins.  Co.  v.  Carpenter,  4  Wis.  20.     And  see  post,  §  255. 

6  Farmers'  &  Mechanics'  Ins.  Co.  v.  Simmons,  30  Pa.  St.  299 ;  White  v.  Mutual 
Fire  Ins.  Co.,  8  Gray  (Mass.),  566  ;  Sauford  v.  Mech.  Mut.  Fire  Ins.  Co.,  12  Cush. 
(Mass.)  541. 

'  Merch.  &  Manuf.  Ins.  Co.  v.  Washington  Ins.  Co.,  1  Handy  (Ohio),  181. 

480 


CH.  XI.]      SPECIAL    PROVISIONS    OF    THE   CONTRACT,   ETC.        [§  242 

and  not  when  it  is  merely  incidental,  and  the  keeping  is 
only  for  the  purpose  of  consumption;  as  when  kerosene  is 
kept  for  the  purpose  of  illumination,  or  saltpetre  for  the 
purpose  of  curing  meats.  Wine  sent  to  a  warehouse  to  be 
kept  and  returned  when  called  for  is  "  stored ;  "  but  wine 
kept  in  one's  cellar  or  garret,  to  be  sold  or  consumed  as 
occasion  may  require,  is  not.  Thus,  a  grocer,  insured  as 
such,  may  keep  wine  and  oil  for  sale,  although  they  are 
classed  as  hazardous  articles ;  and  by  the  terras  of  the  policy 
hazardous  articles  are  not  to  be  "stored."  ^  (a)  [When  a 
policy  prohibited  the  storing  of  oil,  &c.,  it  was  held  that  a 
keeping  of  the  same  in  a  retail  store   for   the  purpose  of 

1  Langdon  v.  N.  Y.  Equitable  Fire  Ins.  Co.,  1  Hall  (N.  Y.),  226  ;  s.  c.  6  Wend 
(N.  Y.)  623  ;  Phcenix  Ins.  Co.  v.  Taylor,  5  Minn.  492  ;  Mayor,  &c.  v.  Hamilton 
Ins.  Co.,  10  Bosw.  (X.  Y.)  537 ;  Rafferty  v.  N.  B.  Fire  Ins.  Co.,  3  Harr.  (N.  J.), 
480  ;  Williams  v.  Mechanics',  &e.  Ins.  Co.,  54  N.  Y.  577  ;  Williams  o.  Fireman's 
Fund  Ins.  Co.,  id.  569  ;  Bayly  v.  London,  &n.  Ins.  Co.,  C.  Ct.  (La.),  4  Ins.  L.  J. 
503  ;  Buchanan  v.  Exchange  Fire  Ins.  Co.,  61  N,  Y.  26  ;  Com.  Ins.  Co.  v.  Mehl- 
nian,  48  111.  313. 


(o)  Where,  under  a  policy,  with  per- 
mission to  complete,  on  a  block  of  un- 
finished buildings  which  was  built  for 
stores  below  and  dwellings  above,  one 
of  the  stores  was  occupied  after  com- 
pletion by  a  retail  grocer,  who  kept  as 
part  of  his  stock  gasoline  and  coal  oil, 
and  a  violent  explosion  having  demol- 
ished the  building,  and  killed  the  grocer 
and  several  members  of  his  family,  the 
evidence  showed  that  shortly  before  the 
explosion  there  was  a  bright  light  and 
probably  fire  in  the  store,  and  the  de- 
fence was  that  keeping  gasoline  voided 
the  ])olicy  under  the  condition  which 
excluded  the  storing  of  hazardous  and 
extra-hazardous  articles,  it  was  held 
that  "keeping"  is  not  "storing;" 
that  a  contract  of  insurance  upon  a 
building  made  before  its  completion 
authorizes  the  use  of  the  building 
in  any  common  business  to  which  its 
construction  is  adapted,  and  that  when 
the  contract  prohibits  storing  hazardous 
articles,  it  does  not  prohibit  keeping 
them  for  sale  in  such  business.  Een- 
VOL.  I.  —  "1 


shaw  V.  Missouri  State  Mut.  F.  &  M. 
Ins.  Co.,  103  Mo.  595.  So  of  the  keep- 
ing of  dynamite.  Phenix  Ins.  Co.  v. 
AValters  "(Ind.  App.),  56  N.  E.  257. 
Under  a  policy  providing  that  coal  oil  not 
exceeding  five  barrels,  and  gunpowder 
not  exceeding  twentj'-five  pounds,' and 
other  merchandise,  "  not  more  hazard- 
ous," usual  to  general  stacks  of  mer- 
chandise, might  be  kept,  the  keeping  of 
three  and  a  half  boxes  of  squibs  con- 
taining about  a  pound  of  powder  does 
not  render  the  policy  void.  Mechanics' 
&  Traders'  Ins.  Co.'v.  Floyd  (Ky.),  28 
Ins.  L.  J.  335.  Where  the  insured 
having  purchased  and  stored  a  lot  of 
fireworks  in  his  house  for  use  on  the  fol- 
lowing day,  which  was  the  Fourth  of 
July,  they  took  fire  and  caused  the 
damage,  the  policy,  which  provided  that 
it  should  be  void  if  the  hazard  were  in- 
curred with  the  knowledge  of  the  in- 
sured, or  if  fireworks,  among  other 
things,  were  allowed  on  the  premises,  was 
held  to  be  avoided.  Heron  v.  Phienix 
Mut.  F.  Ins.  Co.,  180  Peun.  St.  257. 

481 


§  242]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  XI. 

replenishing  stock,  from  time  to  time,  and  in  quantities  not 
miusiially    large,    did   not   vitiate   the   policy. i]      It   is   the 
appropriation  to  the  business  of  storing  that  is  prohibited 
in  a  policy  that  inhibits  the  use  of  the  insured  premises  for 
the  purpose  of  storing  and  keeping  certain  specified  articles, 
while  insuring  a  stock  of  goods  in  which  those  articles  are 
ordinarily  found.     And  it  seems  that  raw  material  used  in 
a  manufacture,  and  brought  into  and  kept  in  the  room  where 
it  is  to  be  manufactured,  is  not  stored  therein  in  the  sense 
of  the  policy  which  prohibits  the  use  of  any  part  of  the  prt;- 
mises  for  storing  such  articles.^     So,    if  the  material  has 
been  casually  and  temporarily  left  in  a^room,  without  any 
purpose  to  ai)propriatc  that  room  to  the  use  of  keeping  and 
storing  it.^     To  use  for  "keeping  and  storing"  is  to  appro- 
priate the  premises  to  that  use  as  a  principal  use,  and  not 
incidentally  and  for  some  other  purpose  to  which  the  keep- 
ing and  storing  is  necessarily  incidental.     Articles  kept  in 
a  store  are  kept  and  stored  for  sale,  but  the  use  of  the  build- 
ing is  for  selling,  and  not  for  keeping  and  storing.^     Oil, 
turpentine,  and  paint  may  be  kept  and  stored  in  a  building 
in  process  of  erection  on  which  they  are  to  be  used,  but  the 
building  can  in  no  proper  sense  be  said  to  be  used  for  keep- 
ing and  storing  them.°     Gunpowder  being  one  of  the  pro- 
hibited articles,  it  appeared  that  the  insured  had  kept  it  for 
sale  in  his  general  stock.     At  the  time  of  insurance  he  had 
some  still  remaining  on  hand,  but  it  was  not  offered  for  sale 
after  the  policy  issued;  and  it  was  hold  that  this  was  neither 
a  storing  nor  a  keeping  for  sale.^     So  where  a  party  insured 
a  building  which  had  been  used  for  dressing  flax,  but  before 
effecting  insurance  the  machinery  had  been  removed  from 

1  [Lanfidon  v.  N.  Y.  Eq.Ins.  Co.,  1  Hall  (N.  Y.),  226,  236.] 

2  Vo{,'el  V.  People's  Mut.  Fire  Ins.  Co.,  9  Gray  (Mass.),  23. 

8  Hynds  v.  Schenoctady  County  Mut.  Ins.  Co.,  16  Barb.  (N.  Y.)  119;  8.  C. 
affirmod,  11  N.  Y.  .^^54;  "Williams  v.  People's  Ins.  Co.,  57  id.  274.  See  also 
Peofilc's  Ins.  Co.  v.  Kulin,  12  Heisk.  (Tenn.)  515;  .s.  c.  1  Cent.  L.  J.  214  and  note. 

*  Moore  v.  Prot.  Ins.  Co.,  29  Me.  97  ;  Leggett  v.  Mtna.  Ins.  Co.,  10  Rich.  Law 
(S.  C),  202  ;  Phfenix  Ins.  Co.  v.  Taylor,  5  Minn.  492. 

6  O'Niel  V.  Buffalo  Fire  Ins.  Co.,  3  Tomst.  (N.  Y.)  122. 

6  Protection  Ins.  Co.  v.  Harmer,  2  Ohio  St.  (22  Ohio)  452. 

482 


CII.  XI.]      SPECIAL   niOVISIONS   OF   THE   CONTRACT,   ETC.        [§  242 

the  building',  tlion<2:li  some  unbroken  flax  —  a  prohibited 
article  —  ronraincd  in  one  corner  of  a  room  till  the  time  of 
th(!  lire,  it  was  ladd  that  this  did  not  constitute  a  use  of  the 
building  for  the  purpose  of  storing  the  flax,  there  being  no 
intention  of  having  it  regularly  stored  or  kept  there  except 
temj)orarily.i  j,j  Dobson  v.  Sotheby  ^  the  language  of  the 
policy  provides  against  the  use  of  the  buildings  to  "store  or 
warehouse  "  any  hazardous  goods,  and  it  \yas  held  that  the 
introduction  of  a  barrel  of  tar  and  its  use  in  repairing  the 
building  was  no  violation  of  the  conditions  of  the  policy. 
But  the  supreme  court  of  Massachusetts  has  repeatedly  taken 
it  for  granted  that  the  keeping  of  an  article  for  sale  in  a 
general  stock  was  an  appropriation,  application,  and  use  of 
the  premises  for  the  purpose  of  keeping  and  storing  of  the 
particular  article.^  In  neither  case,  however,  was  the  point 
discussed  or  raised,  and  the  cases  are  certainly  counter  to 
the  authorities  where  the  point  has  been  deliberately  made. 
So  the  introduction  of  the  prohibited  article  for  a  special 
purpose,  even  though  that  purpose  be  the  destruction  of  the 
building  insured,  is  not  a  "storing"  within  the  meaning  of 
the  policy;  as  where  gunpowder  is  introduced  into  a  build- 
ing for  the  pur])ose  of  blowing  it  up  in  order  to  stay  the 
progress  of  a  conflagration.'*  But  under  a  provision  that  the 
policy  should  be  void  if  there  should  be  at  any  time  more 
than  twenty-live  pounds  of  i)owder  on  the  premises,  the  plac- 
ing of  more  than  that  upon  the  premises  to  await  shipment, 
expected  to  be  in  a  day  or  two,  with  the  assent  of  the  in- 
sured, was  held  to  be  a  violation  of  the  condition.^  A  gen- 
eral prohibition  of  a  particular  article  is. sometimes  modified 
by  a  permission  to  keep  a  certain  amount  of  it.^  [When  the 
company  knows  that  the  premises  may  be  used  for  storing 

1  Ilymls  V.  Sclieiioctady  County  Mut.  Ins.  Co.,  16  Barb.  (N.  Y.)  119  ;  s.  c. 
affirmed,  11  N.  Y.  554. 

2  1  Moo.  &  Mai.  5)0. 

8  Whitniarsh  v.  Cliarter  Oak  Fire  Ins.  Co.,  2  Allen  (Mass.),  581  ;  ante,  §  238  ; 
Macomber  v.  Howard  Fire  Ins.  Co.,  7  Gray  (Mass.),  257  ;  ante,  §  234  ;  Lee  i- 
Howard  Fire  Ins.  Co.,  3  Gray  (Mass.),  583  ;  ante,  §  237. 

*  City  Fire  Ins.  Co.  v.  Corlies,  21  Wend.  (N.  Y.)  367. 

■>  Faulkner  w.  Central  Fire  Ins.  Co.,  1  Kerr  (N.  B.),  279. 

"  Bowman  r.  Pacilic  Ins.  Co.,  27  Mo.  152. 

483 


§  243]  INSURANCE  :   FIRE,   LIFE,   ACCIDENT,   ETC,  [CH.  XI. 

cotton,  and  the  policy  provides  that  the  rate  may  be  changed 
if  the  building  is  used  as  a  storehouse,  the  storing  of  cotton 
will  not  avoid  the  policy. i] 

§  243.  Keeping ;  Premises.  —  A  very  nice  point  was  made 
and  sustained  by  the  Supreme  Court  of  South  Carolina  in  a 
case  where  the  policy  provided  that  "the  keeping  of  gun- 
powder for  sale  or  on  storage  upon  or  in  the  premises  in- 
sured, should  render  the  policy  void."  The  insurance  was 
upon  "  the  stock  of  goods  and  merchandise  contained  in  the 
applicant's  store,"  a  part  of  which  consisted  of  gunpowder. 
But  it  was  contended,  and  so  held,  that  the  word  "  premises  " 
referred  to  buildings  insured;  and  as  there  was  no  insurance 
upon  the  building,  the  gunpowder  was  not  kept  "upon  or  in 
the  premises  insured,"  within  the  meaning  of  the  stipula- 
tion. 2  And  upon  the  same  principle  a  false  representation 
as  to  occupancy  of  a  building  not  itself  insured  was  held 
immaterial.  3  So  a  statement  that  the  title  of  the  insured 
was  a  "fee-simple,"  was  held  to  have  no  application  to  per- 
sonal property  insured.*  So  where  property  situated  in  a 
certain  building  was  stated  to  be  unincumbered,  the  state- 
ment was  held  to  apply  to  the  property  insured,  and  not  to 
the  building  in  which  it  was  situated.^  So  a  prohibition  of 
"  sale,  conveyance,  or  change  of  title  of  the  property  insured  " 
refers  only  to  the  realty.^  But  "premises"  has  been  very 
properly  held  to  cover  a  ship  insured,  excluding  the  risk  of 
gunpowder.'^ 

1  [Steers  v.  Insurance  Co.,  38  La.  An.  952.] 

2  Le^gett  V.  Mtnalns.  Co.,  10  Rich.  Law  (S.  C),  202  ;  post,  §  367. 

3  Howard  Fire  &  Mar.  Ins.  Co.  v.  Cornick,  24  111.  455.  But  see  Wilson  v. 
Herkimer,  &c.  Ins.  Co.,  6  N.  Y.  53,  doubting  Trench  v.  Chenango,  &c.  Ins.  Co., 
7  Hill  (N.Y.),  122.  In  Phoenix  Ins.  Co.  r.  Slaughter,  12  Wall.  (U.  S.)  404,  where 
the  policy  prohibited  "gunpowder  to  be  kept  on  the  premises,  and  camphene, 
&c.,  to  be  kept  for  sale,  stored,  or  used  on  the  premises  in  quantities  exceeding  one 
barrel,"  it  was  held  that  as  there  was  only  a  comma  after  the  word  "premises," 
where  it  first  occurs,  instead  of  a  semicolon,  the  clause  restricting  quantity 
applied  to  gunpowder  as  well  as  to  camphene. 

*  Butler  V.  Standard  Fire  Ins.  Co.,  4  Out.  App.  R.  391. 
5  Ashford  V.  Victoria  Ins.  Co.,  20  U.  C.  (C  P.)  434. 
^  Commercial  Ins.  Co.  v.  Spankneble,  52  111.  53. 

~  Beacon,  &c.  Ins.  Co.  v.  Gibb,  13  (L.  C.)  Dec.  des  Trib.  81.  See  also  ante, 
§228. 

484 


CH.  XI.]      SPECIAL    PROVISIONS    OF    THE    CONTRACT,   ETC.        [§  244 

§  244.  Change  in  Surrounding  Circumstances.  —  Where  par- 
ties have  entered  into  an  agreement,  nothing  beyond  the 
terms  of  the  agreement  can  be  required  of  either  party  ex- 
cept good  faith.  And  if  a  change  in  the  use  of  the  prem- 
ises actually  insured  will  not  work  a  forfeiture,  a  fortiori  & 
change  in  the  use  of  adjoining  premises  will  not.^  If  there 
be  no  want  of  good  faith  in  bringing  about  or  permitting 
any  change  increasing  the  risk,  it  is  immaterial  whether  the 
change  causes  the  loss.  But  if  there  be  bad  faith,  and  the 
loss  is  chargeable  to  the  act  done  or  permitted,  then  it  be- 
comes a  defence  to  the  action  to  recover  the  loss. 2     Where  a 

1  Western  Farmers'  Mut.  Ins.  Co.  v.  Miller,  1  Handy  (Superior  Ct.,  Cincin- 
nati), 325  ;  ante,  §  225  ;  post,  §  259. 

2  The  grounds  upon  which  this  principle  rests  are  thus  stated  in  Stebbms  v. 
Globe  Ins.  Co.,  2  Hall  (N.  Y.  Superior  Ct),  632'    "The  contract  of  insurance 
has  its  foundation  in  the  mutual  good  faith  of  the  parties.     If  the  assured  violates 
that  good  faith  in  any  circumstance  entering  into  the  creation  of  the  contract,  it 
is  no  doubt  void.     But  if,  subsequently  to  its  formation,  he  acts  with  fraud  or 
gross  negligence,  or  in  bad  faith,  with  respect  to  the  subject-matter  insured,  his 
rights   under  the  contract  are  not  impaired  unless  the  loss  which  he  seeks  to 
recover  is  the  result  of  his  own  misconduct.     It  is  a  general  principle  that  no 
man  can  derive  a  right  of  action  against  another  from  his  own  violation  of  duty, 
or  from  his  own  illegal  acts.     Thus  there  is  no  stipulation  in  this  policy  that  the 
assured  shall  not  set  fire  to  the  buildings  insured.      If  he  had  done  so  he  could 
not  recover  the  loss,  on  the  ground  not  that  he  had  violated  any  stipulation  in 
the  contract,  but  that  he  could  not  profit  by  the  consequences  of  his  own  illegal 
or  fraudulent  acts.     If,  however,  he  had  set  fire  to  an  adjoining  building  with  the 
intent  to  consume  the  one  insured,  but  no  injury  to  that  had  in  fact  ensued,  it 
could  not  have  been  contended  that  the  policy  was  thereby  rendered  void,  not- 
withstanding the  act  would  have  been  in  the  highest  degree  a  violation  of  the 
good  faith  which  was  pledged  to  the  insurers,  that  the  risk  should  not  be  in- 
creased by  any  act  of  the  assured.     An  erection  of  buildings  on  vacant  ground  by 
the  assured  subsequently  to  the  policy  and  contiguous  to  those  insured,  whereby 
the  risk  is  increased,  stands  upon  the  same  principle.     If  buildings  thus  erected 
should  be  removed  before  the  occurrence  of  any  loss,  it  could  not  be  maintained 
that  the  policy  would  be  thereby  annulled.     The  act  not  being  in  violation  of 
any  express  stipulation  in  the  policy,  and  not  resulting  in  any  actual  injury  to 
the  insurers,  the  law  would  regard  it  as  harmless  and  rightful  ;  and  if  this  be  so, 
it  seems  clearly  to  follow  that  the  continuance  of  such  erections  (as  in  the  case 
now  before  us)  until  the  fire  cannot  change  the  legal  consequences  of  the  act  of 
erecting  them,  if  they  have  in  no  way  been  the  cause  of  the  loss.     The  act  of  the 
assured  in  erecting  them  may  have  been  a  breach  of  an  implied  understanding 
between  the  parties  that  the  situation  of  the  insured  premises,  witli  respect  to  the 
contiguous  buildings,  should  not  be  changed  by  the  act  of  the  assured  so  as  to 
increase  the  risk  ;  but  if  such  increase  of  risk  has  in  fact  been  without  injury  to 
the  defendants,  the  policy  is  not  affected  by  it."   See  also  Denkla  v.  Insurance  Co., 
6  Phila.  233  ;  Miller  v.  Western,  &c.  Ins.  Co.,   1  Handy  (Cin.  Supr.  Ct.),  208  ; 
Southern  Ins.  Co.  v.  Lewis,  42  Ga.  587. 

485 


§  245]  INSURANCE :    FIRE;   LIFE,   ACCIDENT,   ETC.  [CII.  XL 

policy  provided  in  one  clause  that  a  "change"  without  con- 
sent should  avoid  the  policy,  and  in  another  that  the  insurers 
might  terminate  the  contract  if  additional  buildings  were 
erected,  it  was  held  that  "change  "  did  not  include  the  erec- 
tion of  additional  buildings,  but  referred  rather  to  police 
regulations  against  fire.^  It  applies  to  change  in  the  ph}si- 
cal  condition  of  the  building,  and  not  to  such  a  change  as 
would  be  involved  in  becoming  vacant.'^ 

S  245.  Prohibited  Use ;  Suspension  of  Policy ;  Smoking ; 
Tavern-keeping  ;  Bawdy-house.  —  Some  policies  in  prohibit- 
ing the  use  of  the  buildings  insured  for  certain  purposes 
provide  that  they  shall  be  void  only  so  long  as  the  prohib- 
ited use  continues.  In  such  cases,  of  course,  although  there 
may  have  been  during  the  currency  of  the  policy  a  prohibited 
use,  yet  if  that  use  is  not  in  fact  made  at  the  time  of  the 
fire,  but  has  before  that  happens  been  discontinued,  there  is 
no  forfeiture. 2  But  und^r  a  policy  insuring  property  de- 
scribed as  a  "back  building  and  stores,"  and  prohibiting 
certain  hazardous  uses,  the  introduction  of  a  prohibited  use 

1  Commercial  Ins.  Co.  v.  Melilman,  43  111.  313.     See  also  ante,  §  221. 

2  Home  Ins.  Co.  v.  Kinnier,  28  Grat.  (Va.)  88. 

s  LonnsbuiT  v.  Prot.  Ins.  Co.,  8  Conn.  459  ;  N.  E.  Fire  &  Mar.  Ins.  Co.  v. 
Wetmore,  32  111.  221  ;  Phoenix  Ins.  Co.  v.  Lawrence,  4  Met.  (Ky.)  9.  [If  a  tug- 
boat goes  out  of  the  limits  prescribed  in  the  policy,  and  after  returning  to  the 
proper  waters  a  loss  occurs,  the  policy  covers  the  loss.  Hennessey  v.  Manhat- 
tan Fire  Ins.  Co.,  28  Hun,  98.  It  was  formerly  held  in  Massachusetts  that  a 
temporary  illegal  use  of  insured  premises,  as  for  a  bowling-alley  and  pool-room, 
after  the  expiration  of  a  license  for  such  use,  will  merely  suspend  the  policy  dur- 
ing such  unlawful  use,  and  it  will  revive  when  such  use  ceases,  unless  it  was  con- 
templated at  the  time  of  insuring  to  thus  unlawfully  continue  said  use,  or  the 
temporary  use  injuriously  affects  the  insurers  '.ifter  it  had  ceased.  Hinckley  v. 
Oermania  Ins.  Co.,  140  Mass.  38.  But  in  a  subsequent  case  the  court  held  that 
an  increase  of  ri.sk  by  the  illegal  sale  of  liquors  avoids  the  policy,  although  it  was 
only  temporary,  and  ceased  before  the  fire.  "  The  contract  of  insurance  depends 
essentially  upon  an  adjustment  of  the  premium  to  the  risk  assumed.  If  the  as- 
sured by  his  voluntary  act  increases  the  risk,  and  the  fact  is  not  known,  the 
result  is  that  he  gets  an  insurance  for  which  he  has  not  paid.  In  its  efiect  on 
the  company  it  is  not  much  different  from  a  misrepresentation  of  the  condition 
of  the  property."  Kyte  v.  Commercial  Union  Ass.  Co.,  149  Mass.  116,  123,  re- 
viewing and  shifting  the  ground  of  Hinckley  v.  Germania  Ins.  Co.,  140  Mass.  38. 
A  change  of  use  by  introducing  the  shaving  of  hoops  for  a  few  days  in  a  dwell- 
ing-house, which  was  found  not  to  materially  increase  the  risk,  and  which  ceased 
three  days  before  the  fire,  was  not  fatal.  Kircher  v.  Milwaukee  il.  M.  Ins.  Co., 
"4  Wis.  470.] 

486 


CH.  XI.]      SPECIAL    PROVISIONS    OF   THE    CONTKACT,   ETC.        [§  245 

or  business  will  avoid  the  policy  whether  continued  to  the 
time  of  the  fire  or  not.^  So  if  in  the  description  itself  one 
use  is  permitted  but  another  forbidden,  as  where  a  building 
is  insured  to  be  occupied  as  a  store,  but  not  as  a  coffee- 
house. ^  So,  also,  if  there  be  a  prohibition  against  the  in- 
troduction of  any  specific  article,  as,  for  instance,  steam  or 
a  steam-engine,  the  introduction  of  the  prohibited  thing, 
whether  permanently  or  temporarily,  —  the  policy  being 
made  void  by  its  terms  by  such  introduction,  —  and  whether 
for  a  longer  or  shorter  time,  is  equally  fatal. ^  [But  it  has 
been  held  that  when  the  assured  in  violation  of  the  policy 
introduced  gasoline  for  lighting,  but  removed  it  before  the 
fire,  the  policy  was  held  good,  although  the  policy  was  to 
be,  "immediately  void"  if  gasoline,  &c.  were  used.*  And 
it  is  immaterial  that  the  assured  may  have  been  in  the  habit 
of  breaking  a  condition  of  a  policy  (as  to  keeping  benzine, 
for  example),  which  only  operated  to  make  the  latter  void 
so  long  as  there  was  a  breakage,  if  at  the  time  of  the  loss  he 
was  complying  with  the  same.^]  An  agreement  that  smok- 
ing shall  be  prohibited,  and  a  statement  that  smoking  is  not 
allowed  upon  the  insured  premises,  mean  simply  that  the 
insured  will  not  himself  smoke  on  the  premises,  and  will 
prohibit,  and  take  reasonable  precautions  to  prevent,  others 
from  smoking  there.  ^  So  a  by-law  merely  prohibiting  in- 
surance of  an  illegal  business,  and  requiring  the  agent  to 
remove  the  danger  incurred,  works  no  forfeiture.'  If  the 
policy  stipulates  against  an  occupation  of  the  premises  for 
purposes  considered  hazardous  at  any  time  when  a  fire  shall 
happen,  but  does  not  define  the  meaning  of  the  word,  nor 

1  Mead  r.  N.  W.  Ins.  Co.,  3  Seld.  (N.  Y.)  530. 

2  Lawless  v.  Teun.  Mar.  &  Fire  Ins.  Co.,  Circuit  Ct.  St.  Louis,  Mo.  1852 
(cited  by  Angell,  Ins.  §  169,  n.) ;  s.  c.  Hunt's  Merch.  Mag.,  Feb.  1853  ;  3  Bennett 
Fire  Ins.  Gas.  499. 

3  Glen  V.  Lewis,  8  Wels.,  HurL  &  Gor.  (Exch.)  607. 

•  *  [Mutual  Fire  Ins.  Co.  v.  Coatesville  Shoe  Factory,  80  Pa.  St.  407,  412.] 
&  [Maryland,  &c.  Ins.  Co.  v.  Whiteford,  31  Md.  219,  228.] 
6  Insurance  Co.  of  North  America  v.  McDowell,  50  111.  120  ;  Aurora  Fire  Ins. 

Co.  V.  Eddy,  55  id.  213. 

^  Behler  v.  German,  &c.  Ins.  Co.  (Ind.),  9  Ins.  L.  J.  778.     See  also  ante,  §  231  ; 

Com.  Ins.  Co.  v.  Mehlman,  48  111.  313. 

487 


§  246]  INSUKANCE:   FIRE,   LIFE,   ACCIDENT,    ETC.  [CH.  XL 

contain  any  class  of  risks  denominated  hazardous,  nor  add 
the  test  of  increase  of  risk,  it  will  of  course  be  for  the  jury 
to  determine  not  only  whether  there  has  been  a  change  of 
use,  but  whether  that  change  is  considered  hazardous;  and 
this  would  depend  upon  the  degree  of  the  increase  of  the 
risk.^  Keeping  a  bar-room  in  a  boarding-house  is  not 
"  tavern-keeping  " ;  ^  nor  is  the  keeping  a  bawdy-house  in  a 
house  insured  and  described  as  a  "dwelling-house"  a  con- 
cealment, though  the  house  was  set  on  fire  and  destroyed  by 
a  mob,  such  a  result  not  being  the  natural  consequence  of 
such  a  use.^  [But  if  the  description  is  of  a  dwelling-house, 
and  the  policy  is  to  be  void  by  change  of  use,  keeping  a 
bawdy-house  on  the  premises  is  fatal. ^  (a)  If  a  policy  re- 
quires notice  of  a  change  of  occupancy,  a  use  of  ordinary 
sleeping  apartments  for  purposes  of  assignation  and  prosti- 
tution, without  notice,  is  fatal. ^  The  description  of  prem- 
ises as  a  "  saw-mill "  does  not  restrict  its  use  to  such 
purpose.^ 

§  246=  Unlawful  Use ;  Illegal  Keeping.  —  That  unlawful  use 
of  the  premises  insured  which  will  avoid  a  policy  stipulating 
against  it,  is  not  a  mere  casual  use,  or  permission  of  use, 
for  an  unlawful  purpose,  or  the  doing  of  a  particular  unlaw- 

1  Robinson  v.  Mercer  County  Mut.  Fire  Ins.  Co.,  3  Dutch.  (N.  J.)  134. 

2  Raflerty  v.  N.  B.  Fire  Ins.  Co.,  3  Harr.  (N.  J.)  480. 

3  Loeliner  v.  Home  Mut.  Ins.  Co.,  17  Mo.  247  ;  s.  c.  19  id.  628. 
*  [Cedar  Rapids  Ins.  Co.  v.  Shimp,  16  Brad.  248,  256.] 

5  [Ind.  Ins.  Co.  v.  Brehm,  88  hid.  578.] 

6  [Frost's  Detroit  Lumber,  &c.  Works  v.  Millers',  &c.  Mut.  Ins.  Co.,  37  Miun. 
300.] 

(a)  See  National  F.  Ins.  Co.  v.  U.  S.  to  increased  risk.     Bonerifant  v.  Ameri- 

Buildiiig&  Loan  Ass'n's  Assignee  (Ky.),  can  F  Ins.  Co.,  76  Mich.  653.   Where  the 

54  S.  W.  714  ;  Phenix  Ins.  Co.  v.  Clay  insured  house  was  described  as  "  occu- 

(101    Ga. ),  65  Am.  St.  Rep.  307,  and  pied  as  a  sporting  house,"  it  was  held 

note.     Insurance  of  a   house    used  for  that  as  the  term  "sporting  house"  has 

prostitution  is  not  invalid,  if  the  policy  an  innocent  as  well  as  guilty  meaning, 

contains    no    stipulation   against   such  it  could  not  be  said,  without  proof  of 

use.     Phenix  Ins.  Co.  v.  Clay,  101  Ga.  the  sense  in  which  it  was  used,  that  the 

331.     But  if  a  house,  being  insured  as  a  policy    showed    conclusively    that    the 

dwelling-house  and   inn,  is  kept  as   a  occupancy  of  the  house  was  for  unlaw- 

house  of  prostitution  and  lewdness,  it  ful   purposes.     White   v.   Weston    Ass. 

reTiders  the  fire  risk  more  hazardous  and  Co.,  52  Miun.  352. 
forfeits  the  conditions  of  the  policy  as 

488 


CH.  XI.]      SPECIAL   PROVISIONS   OF   THE   CONTRACT,   ETC.        \  §  246 

ful  act  therein,  as  the  commission  of  a  misdemeanor  or 
even  a  felony,  —  it  must  be  in  some  substantial  sense  a  use 
for  the  alleged  unlawful  purpose.^  But  where  there  is  a 
constant,  exclusive,  and  habitual  use  of  the  insured  prem- 
ises for  unlawful  purposes,  or  in  contravention  of  a  legal 
restriction,  as  where  the  tenant  of  the  insured  for  three 
months  prior  to  the  fire  unlawfully  stored  and  kept  intoxi- 
cating liquors  for  sale,  and  nothing  else,  this  was  held  to 
be  an  insurance  for  the  protection  of  the  illegal  acts,  and  to 
violate  a  proviso  that  the  policy  should  be  void  if  the  build- 
ing insured  should  be  "occupied  or  used  for  unlawful  pur- 
poses," although  the  owner  and  insured  had  no  knowledge 
in  fact  of  such  unlawful  use.^  So  where  a  hotel  is  kept 
without  a  license,^  or  a  billiard  saloon.'*  On  the  other  hand, 
it  has  been  held  in  Michigan  ^  that,  as  under  a  prohibition 
against  keeping  gunpowder  or  other  articles  "  subject  to  legal 
restriction"  in  "greater  quantities  or  in  a  different  manner 
than  prescribed  by  law,"  only  such  articles  are  included  as 
are  of  an  intrinsically  dangerous  nature,  the  illegal  keeping 
of  liquors  for  sale  will  not  avoid  the  policy,  and  illegally 
kept  liquors  may  be  insured.  The  court  in  that  case  say : 
"It  is  claimed  that  if  these  liquors  can  be  allowed  to  be 
included  in  the  policy,  the  policy  will  be  to  all  intents  and 
purposes  insuring  an  illegal  traffic;  and  several  cases  were 
cited  involving  marine  policies  on  unlawful  voyages,  and 
lottery  insurances,  which  have  been  held  void  on  that 
ground.  These  cases  are  not  at  all  parallel,  because  they 
rest  upon  the  fact  that,  in  each  instance,  it  is  made  a  neces- 
sary condition  of  the  policy  that  the  illegal  act  shall  be 
done.  The  ship  being  insured  for  a  certain  voyage,  that 
voyage  is  the  only  one  upon  which  the  insurance  would 
apply,  and  the  underwriters  thus  become  directly  parties  to 

1  Boardinan  v.  Merrimack,  &c.  Ins.  Co.,  8  Cush.  (Mass.)  583. 

2  Kelly  V.  "Worcester  Mut.  Fire  Ins.  Co.,  97  Mass.  284  ;  Jones  v.  Fireman's 
&c.  Ins.  Co.,  2  Daly  (N.  Y.),  307  ;  Johnson  v.  Union,  &c.  Ins.  Co.,  127  Mass. 
555  ;  Lawrence  v.  National  Fire  Ins.  Co.,  127  Mass.  557. 

3  Campbell  v.  Charter  Oak  Ins.  Co.,  10  Allen  (Mass.),  213. 
*  Johnson  v.  Union,  &c.  Ins.  Co.,  127  Mass.  555. 

s  Niagara  Fire  Ins.  Co.  v.  De  Graff,  12  Mich.  124. 

489 


§  246  A]        INSURANCE  :    FIRE,   LIFE,    ACCIDENT,    ETC.  [CH.  XI. 

an  illegal  act.  So  insuring  a  lottery -ticket  requires  the  lot- 
tery to  be  drawn  in  order  to  attach  the  insurance  to  the  risk. 
If  this  policy  were  in  express  terms  a  policy  insuring  the 
party  selling  liquors  against  loss  by  fire  or  forfeiture,  it 
would  be  quite  analogous.  But  this  insurance  is  only  upon 
property,  and  the  risks  insured  against  are  not  the  conse- 
quences of  illegal  acts,  but  of  accident.  Our  statute  does 
not  in  any  way  destroy  or  affect  the  right  of  property  in 
spirituous  liquors,  or  prevent  title  being  transmitted,  but 
renders  sales  unprofitable  by  preventing  the  vendor  from 
availing  himself  of  the  ordinary  advantages  of  a  sale,  and 
also  affixes  certain  penalties.^  By  insuring  this  property, 
the  insurance  company  have  no  concern  with  the  use  the 
insured  may  make  of  it,  and,  as  it  is  susceptible  of  lawful 
uses,  no  one  can  be  held  to  contract  concerning  it  in  an 
illegal  manner,  unless  the  contract  itself  is  for  a  directly 
illeaal  purpose.  Collateral  contracts,  in  which  no  illegal 
design  enters,  are  not  affected  by  an  illegal  transaction  with 
which  they  may  be  remotely  connected.  "^  The  engagement 
in  an  illegal  voyage  of  the  person  whose  life  is  insured  by 
another,  that  other  not  having  knowledge  of  the  fact,  and 
there  being  no  prohibition  in  the  policy,  is  immaterial.^ 

[§  246  A.  Knowledge  of  Agent  or  Officer ;  *  Parol  Evidence. 
—  If  the  president  of  the  company  who  has  exercised  the 
power  of  making  and  renewing  contracts,  knows  that  the  in- 
sured is  adding  to  his  buildings  under  a  verbal  assent,  the 
company  cannot  avail  itself  of  the  increase  of  risk.^  Where 
buildings  had  been  used  and  insured  for  exhibition  build- 
ings, evidence  of  former  insurance  of  this  kind  is  admissible 
to  prove  that  the  company  knew  for  what  purposes  the  build- 
ings were  to  be  used.^     When  the  "Crystal  Palace"  in  New 

1  Hibbard  v.  People,  4  Mich.  125  ;  Bagg  v.  Jerome,  7  id.  145. 

2  The  court  cites,  in  support  of  their  last  proposition,  Ocean  Ins.  Co.  v.  Pol- 
leys,  13  Pet.  (U.  S.)  157  ;  Armstrong  v.  Toler,  11  Wheat.  (U.  S.)  258,  which  were 
res])ectively  cases  of  evasion  of  registry  and  revenue  laws.     See  also  §  327. 

8  Lord  V.  Ball,  12  Mass.  115. 
4  [See  also  §  249  I,  and  ch.  7,  anal.  5.] 
6  [Martin  v.  Jersey  City  Ins.  Co.,  44  N.  J.  273.] 
6  (Mayor  of  New  York  v.  Exchange  Fire  Ins.  Co.,  9  Bos.  424,  434.] 
490 


CH.  XI.]      SPECIAL    PUOYISIONS   OF   THE    CONTRACT,    ETC.        [§  247 

York  was  insured,  it  being  well  known  to  be  an  exhibition 
building,  the  company  were  held  to  have  known  that  fire  and 
steam  heat,  a  restaurant,  ovens,  <S:c.,  were  a  necessary  part 
of  the  business  to  be  carried  on  therein,  and  to  have  in- 
tended to  include  all  such  uses  and  risks. ^  If  before  loss 
the  agent  of  the  company  knows  of  an  increase  of  risk  and 
the  company  does  not  cancel  the  policy  the  objection  is 
waived.2  It  is  competent  to  show,  at  law,  by  parol  evidence 
that  the  company  agreed  to  permit  the  use  of  kerosene,  but 
by  mere  forgetfulness  omitted  to  indorse  the  permission  on 
the  policy.^  The  knowledge  of  an  increase  of  risk  by  one 
who  acts  as  agent  for  the  mortgagor  and  mortgagee  in  secur- 
ing a  renewal  of  insurance,  binds  the  mortgagee,  and  if  such 
increase  is  not  disclosed  the  new  policy  is  void.*] 

§  247.  Occupancy;  Use.  — If  in  the  application  the  prop- 
erty on  which  insurance  is  sought  is  denominated  a  "dwell- 
ing-house," without  any  stipulation  touching  its  use  or 
occupation,  this  is  mere  description,  and  amounts  neither 
to  a  representation  that  it  is  occupied,  nor  a  warranty  that 
it  shall  be.^  (a)     If  the  property  be  denominated  as  the  house 

1  [Mayor  of  New  York  v.  Hamilton  Ins.  Co.,  10  Bos.  537,  552.] 

2  [North  British,  &c.  Ins.  Co.  v.  Steiger,  124  111.  81.] 

3  [Insurance.  Co.  v.  Melvin,  1  Walker  (Pa.),  364.] 
*  [Cole  V.  Germania  Fire  Ins.  Co.,  99  N.  Y.  36.] 

6  [Woodruff  y.  Imperial  Ins.  Co.  (N.  Y.),  10  Ins.  L.  J.  125  ;  Cumberland  Valley, 
&c.  Ins.  Co.  V.  Douglass,  58  Pa.  St.  419  ;  Rowe  v.  Liverpool,  &c.  Ins.  Co.,  12  Gr. 
Ch.  (U.  C.)  311  ;  Browning  v.  Home  Ins.  Co.,  71  N.  Y.  508.  But  see  Alexander 
V.  Germania  Fire  Ins.  Co.,  66  id.  464.  It  has  been  held  in  New  York  that  the 
description  of  property  as  a  "  dwelling-house  "  is  a  warranty  that  the  building 
is,  and  is  to  be,  used  only  as  a  dwelling-house.  Sarsfield  v.  Metropolitan  Ins. 
Co.,  61  Barb.  (N.  Y.)  479,"  following  Wall  v.  East  River  Ins.  Co.,  7  N.  Y.  370. 

(a)  In  a  fire  policy  covering  a  build-  See  Moody  v.  Amazon  Ins.  Co.  (Ohio), 

ing  "  occupied  by  assured  as  a  dwelhng-  38    N.    E.   1011;    Phenix    Ins.    Co.   v. 

house,"  and  providing  that  "if  the  risk  Martin  (Miss.),   16  So.  417.     Under  a 

shall  be  increased  from  any  cause  what-  policy  insuring  property  as  a  building 

ever,  within  the  knowledge  of  the  as-  while  occupied  by  assured   as  a   store 

sured,  .  .  .  the  company  shall  not  be  and  dwelling-house,  and  providing  that 

liable  therefor,"  the  phrase  "occupied  it  should  be  void    in  case   the   prem- 

by  assured  as  a  dwelling-house,"  is  not  a  ises  became  vacant  or  unoccupied,  ces- 

warranty,  but  a  mere  matter  of  descrip-  sation  of  occupancy  as  a  dwelling,  with 

tion,  and  a  lease  of  part  of  the  building  continued  occupancy  as  a  store,  is  not 

does  not  avoid  the  policy.     Heffron  v.  a   violation.      Burlington   Ins.    Co.    v. 

Kittauning  Ins.  Co.,  132  Penn.  St.  580.  Brockway,    138    111.   644.     Where   the 

491 


§  247]  INSURANCE  :    FIKE,    LIFE,   ACCIDENT,   ETC.  [CH.  XI. 

occupied  by  a  particular  person,  this  is  at  most  a  warranty 
that  it  is,  and  not  that  it  shall  continue  to  be,  so  occupied. ^ 
And  in  neither  case  does  the  fact  that  the  house  is  for  a 
time  unoccupied  —  whether  at  the  time  of  the  insurance  ^  or 
afterwards,^  —  or  is  used  as  a  boarding-house,*  vitiate  the 
policy,  even  though  the  loss  happen  while  the  dwelling-house 
is  vacant  or  so  used. (a)     And  this  is  so,  although  the  appli- 

1  Liverpool,  &c.  lus.  Co.  v.  McGuire,  52  Miss.  227. 

2  Diehl  V.  Adams  County  Mut.  Ins.  Co.,  58  Pa.  St.  443.  Contra,  if  the  policy 
is  to  be  void  if  the  premises  are  described  otherwise  than  as  they  really  are,  and 
they  are  occupied  for  more  hazardous  uses  than  that  for  which  they  are  insured. 
Martin  v.  Franklin  Fire  Ins.  Co.,  42  X.  J.  46.  See  also  Farmelee  v.  Hoffman 
lus.  Co.,  54  N.  y.  193.  So  if  the  policy  state  that  buildings  unoccupied  are  not 
insured.    Ashworth  v.  Builders',  kc.  Ins.  Co.,  112  Mass.  422.     See  also  post,  §  248. 

3  O'Niel  V.  Buffalo  Fire  Ins.  Co.,  3  Comst.  (X.  Y.)  122  ;  Cumberland  Valley, 
&c.  Ins.  Co.  V.  Douglass,  58  Pa.  St.  419. 

*  Planters'  Ins.  Co.  v.  Sorrels,  1  Baxter  (Tenn.),  352. 


policy  was  on  the  "  one-story  frame 
building  and  additions  thereto  with 
shingle  roof,  occupied  by  assured  as  a 
dwelling,  .  .  .  including  .  .  .  gas  and 
water  pipes  and  fixtures  for  heating 
and  lighting  as  a  part  of  the  building," 
and  in  the  rear  of  the  main  building 
were  successively  a  laundry,  a  woodshed, 
and  a  part  used  as  a  carriage-house 
and  stalls,  all  under  the  same  shingle 
roof  and  communicating  by  doors,  and 
above  the  carriage-house  was  the  bed- 
room of  the  hired  man,  who  was  also 
a  house  servant,  which  was  furnished 
like  the  rest  of  the  house,  and  had  gas 
and  speaking-tubes  connected  with  the 
rest  of  the  building,  the  policy  was 
held  to  cover  the  carriage-house.  Han- 
nan  V.  Williamsburgh  City  F.  Ins.  Co., 
81  Mich.  556.  The  building,  viz.,  "her 
frame  stable  and  carriage-house  build- 
ings, belonging  with  said  dwelling  and 
on  the  same  lot,"  was  held  to  be  within 
the  description  of  the  policy,  if  it  was 
in  part  used  by  the  plaintiff  as  a  car- 
riage-house, belonging  with  her  dwell- 
ing-house, and  on  the  same  lot,  although 
it  was  also  used  to  some  extent  by  per- 
sons other  than  the  plaintiff  for  other 
purposes.  Eobinson  v.  Pennsylvania 
F.  Ins.  Co.,  87  Maine,  399. 
492 


(n)  A  hotel  is  not  a  dwelling-house, 
and  cannot  be  iusui-ed  as  such.  Thomas 
V.  Commercial  Union  Ass.  Co.,  162  Mass. 
29  ;  see  State  Ins.  Co.  v.  Taylor,  14  Col. 
499.  But  a  boarding-house  may  prop- 
erly be  described  as  a  dwelling  ;  and,  if 
it  is  not  occupied,  but  is  merely  under 
the  care  of  a  person  living  in  the  same 
inclosure,  it  is  vacant  within  the  mean- 
ing of  the  polic}'-.  Burner  v.  German- 
Am.  Ins.  Co.  (Ky.),  45  S.  W.  109. 
When  a  dwelling  is  insured  with  the 
furniture  therein,  a  day  oversight  of 
both  by  the  insured's  hired  man  is 
not  equivalent  to  customary  occupancy. 
Hanscom  v.  Home  Ins.  Co.,  90  Maine, 
333  ;  Agricultural  Ins.' Co.  v.  Hamilton, 
82  Md.  88 ;  Home  Ins.  Co.  v.  Wood,  47 
Kansas,  521  ;  see  Moody  v.  Ins.  Co.,  52 
Ohio  St.  12.  Where  it  was  claimed  that 
the  building  insured  as  a  dwelling  was 
used  as  a  Keeley  Institute,  which  called 
for  a  different  rate  of  premium,  it  was 
held  that  the  rule  making  parol  evi- 
dence inadmissible  to  vary  a  written 
contract  did  not  prevent  the  insured 
from  showing,  by  way  of  estoppel,  a 
knowledge  of  its  real  use  by  tlie  general 
agent  through  whom  it  was  insured  ; 
and  that,  the  application  having  been 
prepared  by  such  agent,  the  company 


CH.  XL]     SPECIAL    PROVISIONS    OF   THE    CONTRACT,    ETC.        [§  247 


cation  and  conditions  are  made  part  of  the  policy,  and  one 
of  the  conditions  provides  that  the  insurance  shall  be  void 
and  of  no  effect  if  the  risk  shall  be  increased  by  any  means 
whatever  within  the  control  of  the  insured. ^  So,  if  stated 
to  be  used  and  occupied  for  farmer's  use.^  So  if  a  building 
is  stated  to  be  fastened  up,  and  only  occupied  for  a  certain 
purpose,  though  the  statement  be  made  a  warranty  by  the 
terms  of  the  policy,  it  is  only  a  warranty  of  the  situation  at 
the  time  of  effecting  the  insurance,  and  not  that  it  shall  so 
continue  during  the  whole  term  of  the  risk.  3(a)     It  would  be 

1  Joyce  V.  Maine  Ins.  Co.,  45  Me.  168  ;  Gilliat  v.  Pawtucket  Mut.  Fire  Ins. 
Co.,  8  Ricli.  282. 

^  Gamwell  v.  Merchants'  &  Farmers'  Mut.  Fire  Ins.  Co.,  12  Cash.  (Mass.)  167. 

8  [The  insurance  of  a  house  as  occupied,  without  more,  is  not  a  promise  that  it 
.shall  remain  so.     Somerset  County  Mut  Fire  Ins.  Co.  v.  Usaw,  112  Pa.  St.  80.] 


was  estopped  to  rely  on  a  misdescrip- 
tion. Glover  v.  National  F.  Ins.  Co., 
85  Fed.  Eep.   125. 

As  to  builder's  and  other  permits  for 
temporary  non-occupancy,  see  Hill  v. 
Commercial  Union  Ass.  Co.,  164  Mass. 
406;  Burnham  v.  Royal  Ins.  Co.,  75 
Mo.  App.  394  ;  Dupny  v.  Delaware  Ins. 
Co.,  6.3  Fed.  Eep.  680;  German  Ins. 
Co.  V.  Penrod,  35  Neb.  273  ;  Newmar- 
ket Sav.  Bank  v.  Royal  Ins.  Co.,  150 
Mass.  374 ;  Des  Moines  Ice  Co.  v. 
Niagara  F.  Ins.  Co.,  99  Iowa,  193; 
Eanspach  v.  Teutonia  F.  Ins.  Co.,  109 
Mich.  699  ;  England  v.  Westchester 
F.  Ins.  Co.,  81  Wis.  583  ;  Thomson  v. 
Southern  Mut.  Ins.  Co.,  90  Ga.  78  ; 
Robinson  v.  Mtna  Ins.  Co.  (Ky.),  38 
S.  W.  693  ;  Thomas  v.  Hartford  F.  In.s. 
Co.  (Ky.),  53  id.  297. 

As  to  facts  showing  a  waiver  of  the 
permit  required  by  the  policy  in  case  of 
vacancy,  see  Trott  v.  Woolwich  F.  Ins. 
Co.,  83  Maine,  362  ;  Quinsigamond  Lake 
S.  Co.  V.  Phcenix  Ins.  Co.,  172  Mas;. 
367;  Strunk  v.  Firemen'.s  Ins.  Co.,  160 
Penn.  St.  345. 

(a)  Vacancy  of  the  premises  without 
the  insurer's  consent,  before  the  policy 
really  becomes  effective,  does  not  avoid 
'^he  policy.     Wainer  v.  Milford  Mut.  F. 


Ins.  Co.,  153  Mass.  336.  So  if  the  in- 
sured building  is  unoccupied  when  the 
policy  is  issued,  and  this  is  known  to 
the  insurer's  agent  who  issues  it,  the 
policy  is  valid.  Hilton  v.  Phoenix  Ass. 
Co.,  92  Maine,  272 ;  Rochester  Loan 
Co.  V.  Liberty  Ins.  Co.,  44  Neb.  537. 
Such  agent  may  by  parol  waive  a  pro- 
vision of  the  policy  requiring  tlie  build- 
ing to  be  completed  and  occupied  within 
thirty  days.  Queen  Ins.  Co.  v.  Kline 
(Ky.),  32  S.  W.  214.  See  Hotchki.ss  v. 
Phanix  Ins.  Co.,  76  Wis.  269  ;  O'Brien 
V.  Prescott  Ins.  Co.,  134  N.  Y.  28  ; 
Messelback  v.  Norman,  122  N.  Y.  578  ; 
Cross  V.  National  F.  Ins.  Co.,  132  N.  Y. 
133.  In  proving  a  loss,  even  misrepre- 
sentations as  to  occupancj",  when  clearly 
unintentional,  do  not  avoid  the  policy. 
Hilton  V.  Phoenix  Ins.  Co.,  supra.  See 
McNally  v.  Phcenix  Ins.  Co.,  137  N.  Y. 
389.  If  the  insured  insists  upon  a  per- 
mit for  vacancy,  when  he  pays  a  pre- 
mium note,  and  afterwards  asks  to  have 
the  monej'  returned  on  receiving  no  re- 
ply, and  repayment  is  not  made,  the 
insurer  waives  the  condition  as  to  occu- 
pancy. Havens  v.  Home  Ins.  Co.,  Ill 
Ind.  90;  Phenix  Ins.  Co.  v.  Boyer,  1 
Ind.  App.  329.  A  clause  in  the  policy 
that  it  shall  be  inoperative  during  tern- 

493 


§  247]  IXSURAXCE  ,    FIRE,   LIFE,    ACCIDENT,    ETC,  [CH.  XI. 

unreasonable,  if  not  absurd,  to  suppose  that  the  owner  of  a 
building  which  may  be  usefully  and  profitably  occupied  could 
intend  by  such  a  stipulation  to  deprive  himself  of  such  use 
and  profit  during  the  entire  term  covered  by  the  policy,  im- 
Icss  so  explicitly  stated.  That  such  is  not  the  intention  of 
the  insurers  is  to  be  inferred,  especially  if  they  provide  else- 
where in  the  policy  against  an  increase  of  risk.^  Nor  is  it 
material  that  there  is  a  change  in  tenants  ^  from  a  careful 
to  a  negligent  one,^  or  from  a  reputable  to  a  disreputable 
one.*(«)  In  Gatlin  r'.  The  Springfield  Fire  Insurance  Com- 
pany,^ the  property  was  described  as  "at  present  occupied  by 
one  Joel  Rodgers  as  a  dwelling-house,  but  to  be  occupied 
hereafter  as  a  tavern,  and  is  privileged  as  such,"  and  the 
latter  clause  was  held  not  to  be  either  a  warranty  that  the 
house  should  be  occupied  as  a  tavern,  or  even  a  representa- 

1  Blood  V.  Howard  Fire  Ins.  Co.,  12  Cush.   (Mass.)  472;  U.  S.   Fire  &  Mar. 
Ins.  Co.  V.  Kimberly,  34  Md.  224. 

2  Hobson  V.  Wellington  Dist.  Ins.  Co.,  6  U.  C.  (Q.  B.)  536, 

8  Gates  V.  Madison  County  Mut.  Ins.  Co.,  1  Seld,  (N.  Y.)  469. 
4  Lyon  V.  Com.  Ins.  Co.,  2  Rob.  (La.)  266. 
6  1  Sumner  (U.  S.  C.  C),  435. 

porary  vacancy  is  effective  during  the  held  not  to  affect  the  others,  each  being 
periods  of  non-occupancy.  Baldwin  v.  insured  for  a  specific  amount.  l,n  Bur- 
German  Ins.  Co.,  105  Iowa,  379.  The  lington  Ins.  Co.  v.  Brockwa}',  138  111. 
assignee  of  a  policy  is  bound  by  a  stipu-  644,  a  building  represented  as  occupied 
lation  therein  against  vacancy.  Rans-  as  a  store-honse  and  dwelling-house, 
pach  V.  Teutonia  F.  Ins.  Co.,  109  Mich,  with  a  provision  against  vacancy,  was 
699.  held  not  avoided  by  its  occupancy  only 
In  "Worley  r.  State  Ins.  Co.,  91  Iowa,  as  a  store-house,  as  the  warranty  related 
150,  the  premium  paid  was  a  gross  sum,  only  to  use  when  insured,  and  express 
and  the  policy  insuring  in  specific  sums  words  are  necessary  for  a  continuing 
a  house  and  barn,  its  provision  against  warranty. 

the  vacancy  of  both  was  held  not  vio-  Occupancy   for   the'  fraudulent  pnr- 

lated  by  the  vacancy  of  one.     In  Conn,  pose   of    burning    the   building   or   its 

F.  Ins.  Co.  r.  Tilley,  88  Va.  1024,  where  contents   is   not  such  occupancy  as  is 

eight  double  houses,  with  lanes  running  intended    by    the    policy.      Names   v, 

between  them,  were  insured  as  sixteen  Dwelling-House  Ins.  Co.,  95  Iowa,  642. 

different  houses,  the  separate  valuation  Vacancy  in   violation  of  an   insurance 

put  upon  them  by  the  parties  caused  policy  is  matter  of  defence.     Butternut 

them  to  be  treated  as  distinct  matters  Manuf.  Co.  v.  Manufacturers'  M.  F.  Ins. 

of  contract  with  respect  to  the  stipula-  Co.,  78  Wis.  202. 

tion  against  vacancy  of  the  "insured  (a)   See   Bonenfant  v.  American   F. 

premises."      In    Speagle   v.    Dwelling-  Ins.   Co.,    76  Mich.    653,    660;   sirpm, 

House  Ins.  Co.,  97  Ky.  646,  the  vacancy  §  245,  n.  (a). 
of  two  of  several   insured  houses  was 

494 


CII.  XI.]      SPECIAL   PROVISIONS    OF    THE    CONTRACT,    ETC.        [§  247 

tion  of  the  intention  to  occupy  it  as  such.  The  insured  was 
the  mortgagee,  and  if  the  language  could  fairly  be  treated  as 
his,  it  would  import  no  more  than  a  representation.  But 
the  language  cannot  in  strictness  be  treated  as  the  language 
of  the  mortgagee.  He  cannot  be  presumed,  in  the  absence 
of  evidence,  to  intend  to  take  possession  and  control  of  the 
property.  It  is  to  be  privileged  by  the  company  of  course, 
to  be  used  as  a  tavern.  This  is  their  language,  and  imports 
a  license  or  privilege  granted  by  the  insurers  to  use  the 
house  as  a  tavern  if  the  insured  so  desire,  but  by  no  means 
an  undertaking  on  his  part  that  it  shall  be  so  used.  And 
in  Boardman  v.  N.  H.  Mutual  Fire  Insurance  Company  ^  it 
was  held  that  such  descriptive  words  in  an  application  were 
not  warranties,  but  mere  representations,  although  expressly 
made  part  of  the  contract  by  reference ;  on  the  ground  that 
it  could  not  reasonably  be  supposed  that  the  insurers  could 
intend  to  make  the  validity  of  the  policy  dependent  upon  so 
trifling  a  matter  as  a  mere  change  of  tenants,  or  a  change 
from  occupancy  to  vacancy,  unless  they  said  so  expressly. 
Nor  is  a  statement  that  the  insured  buildings  are  "occupied 
as  stores  "  a  warranty  that  they  shall  all  be  occupied. ^  But 
such  a  statement  is  doubtless  a  warranty  of  the  then  existing 
use  or  occupation.^  A  change  from  occupation  to  disuse  is 
a  change  in  the  "use  or  occupation"  of  the  property  within 
the  meaning  of  chapter  34  of  the  Laws  of  Maine,  1861.*  («) 

1  20  N.  H.  551.  See  also  Billings  r-  Tolland  County  Mut.  Fire  Ins.  Co.,  20 
Conn.  139. 

2  Carter  v.  Humboldt  Fire  Ins.  Co.,  17  Iowa,  456. 

3  Farmers'  &  Drovers'  Ins.  Co.  v.  Curr_y,  13  Bu.sh  (Ky. ),  312. 

*  Cannell  v.  Phoenix  Ins.  Co.,  59  Me.  582.  That  statute  is  as  follows:  "No 
insurance  company  shall  avoid  payment  of  a  loss  by  reason  of  incorrect  state- 
ments of  value  or  title,  or  erroneous  description  by  the  insured  in  the  contract  of 
insurance,  if  the  jury  shall  find  that  the  difference  between  the  property  described 
and  as  really  existing  did  not  contribute  to  the  loss,  or  materially  increase  the 
risk  ;  any  change  in  the  property  insured,  its  use  or  occupation,  or  breach  of  any 
of  the  conditions  or  terms  of  the  contract  by  the  insured,  shall  not  affect  the  con- 
tract unless  the  risk  was  thereby  materially  increased."     Laws  of  1861,  c.  34. 

(«)  Now,    under    the    Maine    Rev.  occupancy  materially  increased  the  risk, 

Stats.,  ch.  49,  §  20,  which  places  the  such  burden,  in  a  case  devoid  of  any 

burden  of  proof  on  the  insurance  com-  proof  of   the  attendant  circumstances, 

pany  to  show,  in  case  of  loss,  that  non-  may  be  sufficiently  sustained  in  the  first 

495 


§  248]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  XL 

But  such  a  change  is  not  "a  change  in  the  nature  of  the 
occupancy,"  which  means  occupation  for  a  different  purpose. ^ 
§  248.  Occupancy;  Vacation.  —  A  statement  in  the  appli- 
cation that  the  unoccupied  building  insured  is  to  be  occu- 
pied by  a  tenant,  is  not  a  warranty  that  it  shall  be  so 
occupied,  but  rather  the  representation  of  the  insured's  ex- 
pectation that  it  will  be  so  occupied,  and  not  by  himself, 
and  a  reservation  of  the  right  to  have  it  so  occupied,  to 
avoid  the  inference  that  it  is  to  remain  unoccupied.  Nor 
does  it  exclude  the  insured  from  the  right  to  occupy.  This 
is  inferable  from  the  obvious  difficulty  of  fixing  any  time 
when  it  could  be  alleged  there  was  a  breach  of  the  warranty, 
if  it  were  a  warranty.  ^  (a)     Perhaps  if  the  time  were  fixed 

1  Gould  V.  Brit.  Am.  Ass.  Co.,  27  U.  C.  (Q.  B.)  473. 

2  Hough  V.  City  Fire  Ins.  Co.,  29  Conn.  101  ;  Catlin  v.  Springfield  Fire  Ins. 
Co.,  1  Sumner  (U.  S.),  434  ;  Herrick  v.  Union  Mut.  Fire  Ins.  Co.,  48  Me.  558  ; 
Kelley  v.  Home  Ins.  Co.,  C.  Ct.  (Kans.),  5  Ins.  L.  J.  134. 


instance  by  the  natural  presumption  to 
that  effect  based  upon  the  observation 
and  experience  of  intelligent  men  gen- 
erally. White  V.  Phoenix  Ins.  Co.,  83 
Maine,  279  ;  85  id.  97  ;  Jones  v.  Gran- 
ite State  F.  Ins.  Co.,  90  id.  40. 

(a)  What  is  meant  by  the  clause 
"vacant  and  unoccupied,"  in  a  policy 
of  insurance,  is  a  question  of  law ;  but 
whether  the  building  was  at  the  time  of 
the  loss  vacant  and  unoccupied,  within 
the  meaning  of  the  policy,  is  a  question 
of  fact.  Thus,  where  a  tenant  had  left 
the  house  without  notice,  and  a  new 
one,  who  was  waiting  to  occupy  it,  had 
begun  to  move  in,  it  was  held  to  be  a 
question  of  fact  whether  the  premises 
were  vacant  and  unoccupied.  Home 
Ins.  Co.  V.  Mendenhall,  164  111.  458, 
469 ;  see  Richards  v.  Continental  Ins. 
Co.,  83  Mich.  508  ;  Robinson  v.  Mtna, 
Ins.  Co.  (Ky.),  38  S.  E.  693  ;  Dwelling- 
House  Ins.  Co.  v.  Ohborn,  1  Kans.  App. 
197;  Moody  v.  Ins.  Co.,  52  Ohio  St.  12; 
Roe  V.  Dwelling-House  Ins.  Co.,  149 
Penn.  St.  94  ;  Limburg  v.  German  F. 
Ins.  Co.,  90  Iowa,  709  ;  48  Am.  St.  Pep. 
468,  478,  note  ;  Moore  v.  Phoenix  Ins. 

496 


Co.  (N.  H.),  10  id.  384,  390,  note; 
Worley  v.  State  Ins.  Co.,  91  Iowa,  150  ; 
Clifton  Coal  Co.  v.  Scottish  Union  &  N. 
Ins.  Co.,  102  Iowa,  300;  German- 
American  Ins.  Co.  V.  BuckstafF,  38 
Neb.  135;  Liverpool,  &c.,  Ins.  Co.  v. 
Buckstaff,  id.  146;  Moriarty  v.  Home 
Ins.  Co.,  53  Minn.  549  ;  Burlington  Ins. 
Co.  V.  Lowery,  61  Ark.  108  ;  East  Texas 
F.  Ins.  Co.  V.  Kempner  (Tex.  Civ. 
App.),  25  S.  W.  999;  Eureka  F.  &  M. 
Ins.  Co.  V  Baldwin  (Ohio),  57  N.  E. 
571.  In  such  cases,  the  insurer,  though 
knowing  of  the  vacancy,  owes  no  duty 
to  the  insured  to  prevent  a  forfeiture 
by  notifying  him  thereof.  Home  Ins. 
Co.  V.  Scales,  71  Miss.  975.  Substan- 
tial compliance  with  the  contract  is  all 
that  is  required,  and  a  mere  temporary 
absence,  which  does  not  increase  the 
risk,  is  not  fatal.  Springfield  F.  &  M. 
Ins.  Co.  V.  McLimans,  28  Neb.  846  ; 
Johnson  v,  Norwalk  F.  Ins.  Co.  (175 
Mass.),  29  Ins.  L.  J.  371.  In  all  these 
cases,  the  mere  letter  of  the  contract 
may  be  disregarded  in  aid  of  its  real 
purpose.  Thus,  where  a  canning  estab- 
lishment was,  at  the  Close  or  the  season, 


CH.  XI.]      SPECIAL    PROVISIONS   OF   THE    CONTKACT,   ETC.        [§  248 

within  which  it  should  be  occupied,  or  within  which  notice 
of  vacation  should  be  given, ^  the  rule  would  be  different.^ 
If  in  the  description  the  recital  is  that  the  property  insured 
is  only  to  be  used  or  occupied  in  a  certain  way,  or  not  to  be 
used  or  occupied  at  all,  this  is  an  agreement,  and  must  be 
complied  with;^  and  so  it  is  if  the  policy  provides  that 
unoccupied  buildings  must  be  insured  as  such,  and  in  case 
the  building  becomes  vacant  the  insured  shall  give  notice, 
or  forfeit  his  right  to  recover. ^  Not  unfrequently  it  is  pro- 
vided that  if  the  occupant  personally  vacates  the  premises 
insured,  or  the  building  becomes  vacant,  the  policy  will  be 
void,  unless  immediate  notice^  be  given  to  the  insurers  and 

1  Alston  V.  Old  North  State  Ins.  Co.,  80  N.  C.  326. 

2  Bilbrough  v.  Metropolitan  Ins.  Co.,  5  Duer  (N.  Y.),  587  ;  Devine  v.  Home 
Ins.  Co.,  32  Wis.  471 ;  Cardinal  v.  Dominion  Ins.  Co.,  16  Can.  L.  J.  (Q.  B.)  335. 

3  Stout  V.  City  Fire  Ins.  Co.,  12  Iowa,  371. 

4  Wustum  V.  City  Fire  Ins.  Co.,  15  Wis.  138  ;  Harrison  v.  City  Fire  Ins.  Co., 
9  Allen  (Mass.),  231 ;  Alston  v.  Old  North  State  Ins.  Co.,  80  N.  C.  326  ;  ante, 
§  247. 

^  [And  the  notice  given  must  be  truthful  in  its  material  details.  A  policy 
contained  the  usual  "vacant  or  unoccupied"  clause  with  the  addition  "unless 

insured  as  a  place  of  storage,  and  the  avoided  because  of  vacancy ;  and  Nor- 
policy  provided  that  it  should  be  used  val,  C.  J.,  said,  in  reference  to  the  con- 
for  storage  only,  the  building  of  a  fire  flicting  authorities:  "The  meaning  of 
under  the  boiler  to  blow  the  water  out  the  words  'vacant  and  unoccupied,' 
of  the  pipes  and  flues,  was  held  not  to  when  used  in  a  policy  upon  a  dwelling, 
be  a  use  of  the  premises  for  a  purpose  is  not  the  same  as  when  used  in  a  con- 
other  than  storage.  Krug  v.  German  tract  of  insurance  on  a  store  building, 
F.  Ins.  Co.,  147  Penn.  St.  272.  So  a  livery  stable,  or  a  .school-house.  It  will 
provision  that  a  factory  must  be  oper-  hardly  be  contended  that  a  policy  on  a 
ated  is  not  violated,  upon  the  owner's  school  building  is  not  in  force  during 
insolvency,  by  his  assignee  renewing  the  the  summer  vacation  of  the  school, 
policy  when  the  premises  had  ceased  to  although  there  is  no  person  in  the  build- 
be  used  for  manufacturing,  the  fires  ing  during  that  period.  The  use  to 
being  out,  but  were  occupied  by  the  which  the  building  is  adapted  and 
foreman  for  putting  together  and  sel-  devoted  has  much  to  do  in  determining 
ling  the  machines  already  made.  Bole  whether  it  is  vacant  or  unoccupied. 
V.  New  Hampshire  F.  Ins.  Co.,  159  Each  case  must  be  determined  upon  its 
Penn.  St.  53.  In  German  Ins.  Co.  v.  own  ])eculiar  facts." 
Davis,  40  Neb.  700,  where  tenants  stip-  In  courts  of  eqidty,  where  forfeitures 
ulated  for  in  the  policy,  moved  out  in  are  not  favored,  the  want  of  occupancj', 
the  evening  a  few  hours  before  the  fire,  to  be  fatal  to  the  insured,  must  be 
and  the  owner,  living  in  another  city,  shown  to  have  been  a  contributing 
could  not  be  notified  so  as  to  attend  to  cause  to  the  fire  or  to  its  continuance, 
the    matter,    the   policy  was   held   not  Traders'  Ins.  Co.  v.  Race,  142  111.  338. 

VOL.  I.— 32  497 


§  248]  INSURANCE :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  XL 

an  additional  premium  paid.  In  such  case,  vacation  with- 
out notice  and  payment  of  the  additional  premium  is  of 
course  fatal  to  the  right  of  the  insured  to  recover  for  a  loss, 
and  notice  to  a  special  agent,  among  other  things,  author- 
ized to  receive  cash  for  premiums,  is  not  sufficient,  if  the 
premium  be  not  also  paid.  It  is  indeed  doubtful  if  the  pay- 
ment of  the  premium  would  help  the  matter,  as  it  is  ques- 
tionable whether  an  agent  to  receive  premiums  fixed  by  the 
company  would  have  the  right  to  fix  the  rate  of  additional 
premium.  1  A  mere  absence  of  the  family  on  a  visit,  how- 
ever, with  no  intention  to  remove  and  vacate  the  house,  is 
not  a  violation  of  a  condition  that  it  shall  not  be  left  vacant 
and  unoccupied ;  ^  (a)  nor  is  the  leaving  a  furnished  summer- 
house  in  the  fall,  with  intent  to  return  in  the  spring,  the 
house  being  meanwhile  in  the  charge  of  a  person  who  lived 
near  by.^  And  it  seems  that  the  use  and  occupation  of  a 
school -house  in  the  usual  manner,  with  stated  vacations, 
would  be  permissible;   but  not  the  removal  of  the  school 

notice  of  removal,  with  all  particulars,  be  given  the  company."  The  assured 
gave  notice  that  he  was  to  go  on  a  three  or  four  weeks'  visit,  but  would  leave 
nearly  all  the  household  goods.  On  the  contrary,  practically  all  of  them  were 
taken  away,  and  it  was  held  that  the  policy  was  avoided.  A  house  containing 
goods  is  more  apt  to  be  taken  care  of,  and  the  company  has  a  right  to  avail  itself 
of  this  security,  so  that  the  misstatement  was  material.  Hill  v.  Equitable  Mut. 
Fire  Ins.  Co.,  58  N.  H.  82,  83.] 

1  Harrison  v.  City  Fire  Ins.  Co.,  9  Allen  (Mass.),  231 ;  Wustnni  v.  City  Fire 
Ins.  Co.,  1.5  Wis.  138  ;  Dennison  v.  Phoenix  Ins.  Co.  (Iowa),  9  Ins.  L.  J.  65  ;  Hill 
V.  Equitable  Ins.  Co.  (N.  H.),  6  Ins.  L.  J.  314  ;  Paine  v.  Agricultural  Ins.  Co.,  5 
S.  C.  (N.  Y.)  619  ;  American  Ins.  Co.  v.  Padelfield,  78  111.  167;  Cook  v.  Conti- 
nental Ins.  Co.,  70  Mo,  610  ;  McClure  v.  Watertown  Ins.  Co.  ^Pa.),  9  Ins.  L.  J. 
209. 

2  Stupetzki  V.  Transatlantic  Fire  Ins.  Co.,  43  Mich.  373.  [Where  a  house  was 
left  for  a  brief  visit,  the  family  leaving  at  home  all  but  the  few  garments  needed 
while  away,  and  the  husband  returned  and  stayed  in  the  house  overnight,  occa- 
sionally, and  he  and  another  were  in  it  during  the  night  of  the  fire,  the  house 
was  not  "vacant  and  unoccupied."  Occupancy  only  requires  the  presence  of 
human  beings  as  at  their  customary  abode  ;  not  uninterruptedly  but  as  the  place 
of  usual  return  and  habitual  stoppage.  Johnson  v.  N.  Y.  Bowery  Fire  Ins.  Co., 
39  Hun,  410.  In  this  case  the  house  was  occupied  in  fact  at  the  time  of  the  fire. 
Stupetzki  V.  Transatlantic  Fire  Ins.  Co.,  43  Mich.  373,  374.] 

8  Herrman  v.  Merchants'  Ins.  Co.  (N.  Y.),  9  Ins.  L.  J.  658, 

(a)  Hill  V.  Ohio  Ins.  Co.,  99  Mich.  466  ;  McMurray  v.  Capital  Ins.  Co.,  87 
Iowa,  453. 

498 


CH.  XL]      SPECIAL    PROVISIONS   OF   THE    CONTKACT,   ETC.        [§  248 

furniture,  and  the  suspension  of  the  school. ^  Nor  does  a 
mill  become  unoccupied  by  a  mere  temporary  suspension  of 
its  full  operation,  and  while  it  is  used  for  the  storage  and 
delivery  of  goods,  requiring  daily  visits  from  one  or  two 
persons ;  ^  [nor  by  a  stoppage  for  repairs,  enough  employees 
being  on  hand  to  retain  possession  and  keep  watch. ^  Inter- 
ruptions and  the  necessary  disuse  temporarily  of  a  saw-mill, 
by  reason  of  low  water,  derangement  of  machinery,  &c.,  do 
not  break  the  forfeited-if-vacant-clause  in  a  policy. *]  But 
a  warranty  that  a  family  shall  live  in  the  house  throughout 
the  year  is  not  kept  by  merely  having  two  workmen  occupy 
it  as  a  lodging-place  taking  their  meals  elsewhere.^ 

If  there  is  no  express  stipulation  that  the  premises  shall 
not  be  left  vacant,  the  policy  will  not  be  void,  although  the 
risk  be  increased  by  the  fact  that  they  are  so  left,  unless 
perhaps  when  they  are  purposely  so  left.^  So,  although 
there  be  an  express  oral  promise,  if  the  promise  be  in  good 
faith. '^  And  under  an  agreement  that  a  vessel  shall  be  pro- 
vided with  "master,  officers,  and  crew,"  the  giving  up  the 
vessel  to  workmen  for  repairs  is  no  violation  of  the  con- 
tract.^ So  a  temporary  vacancy  with  intention  to  return  is 
not  a  "removal,"  it  not  being  abandoned  as  a  place  of 
abode.^(a)     There  is  no  implied  obligation  to  keep  a  watch 

1  American  Ins.  Co.  v.  Foster  (111.),  9  Ins.  L.  J.  268. 

2  Albion  Lead  Works  v.  Williamsburg,  &c.  Ins.  Co.,  C.  Ct.  (Mass.),  2  Fed. 
Kep.  479. 

3  [Brighton  Manuf.  Co.  v.  Reading  Fire  Ins.  Co.,  33  Fed.  Eep.  232.  See  also 
234.  American  Fire  Ins.  Co.  v.  Brighton  Cotton  Manuf.  Co.,  24  Brad.  152  ; 
American  Fire  Ins.  Co.  v.  Brighton  Cotton  Manuf.  Co.,  125  111.  131.] 

*  [Whitney  v.  Black  River  Ins.  Co.,  72  N.  Y.  117,  120.] 

5  Poor  V.  Humboldt,  125  Mass.  274.  See  also  Cook  v.  Continental  Ins.  Co., 
70  Mo.   610. 

6  Gamwell  v.  Merchants'  &  Farmers'  Mut.  Fire  Ins.  Co.,  12  Cush.  (Mass.) 
167  ;  Foy  v.  .Etna  Ins.  Co.,  3  Allen  (N.  B.),  29. 

T  Kimball  v.  iEtna  Ins.  Co.,  9  Allen  (Mass.),  540  ;  Stout  v.  City  Fire  Ins.  Co. 
of  New  Haven,  12  Iowa,  371. 

8  St.  Louis  Ins.  Co.  v.  Glasgow,  8  Mo.  713. 

9  Cummins  v.  Agr.  Ins.  Co.,  67  N.  Y.  260  ;  Phoenix  Ins.  Co.  v.  Zucker  (111.), 
9  Ins.  L.  J.  193.     But  .see  Sleeper  v.  New  Hampshire  Fire  Ins.  Co.,  56  N.  H.  401. 

(a)  The  terms  "  absence "  and  "  re-  against  vacancy  "by  removal  "  for  more 
moval  "  differ  widely  when  applied  to  a  than  thirty  days  is  not  violated,  as 
dwelling-house,  and  a  clause  pioviding     matter  of  law,  by  an  absence  for  healthy 

499 


§  249]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  XI. 

in  or  about  a  vacant  house.  ^  But  when  by  express  terms, 
if  the  risk  is  increased  in  any  manner  by  the  permission  of 
the  insured  during  the  currency  of  the  policy,  it  is  to  become 
void,  the  voluntarily  leaving  a  house,  occupied  when  insured, 
unoccupied  for  such  a  length  of  time  and  under  such  circum- 
stances as  to  warrant  an  inference  that  it  was  purposely  so 
left  unoccupied,  will  have  the  effect  to  avoid  it.^ 

§  249.  Change  of  Possession  ;  Occupancy  ;  Vacation.  —  Un- 
der a  provision  that  the  policy  shall  cease  to  protect  the 
property  from  the  time  when  it  shall  be  "  levied  on  or  taken 
into  possession  or  custody  under  an  execution,  or  any  pro- 
ceeding in  law  or  in  equity,"  an  unlawful  levy,  made  upon 
the  property  as  that  of  a  person  Other  than  the  insured,  will 
not  have  the  effect  to  invalidate  the  policy.^  And  although 
the  mere  notice  of  the  levy,  by  the  officer  charged  with  the 
duty,  to  the  defendants,  —  the  insured,  —  without  taking  the 
property  into  possession  or  custody,  may  be  good  as  a  levy, 
it  will  not  be  sufficient  to  defeat  the  policy.  It  is  an  actual, 
not  a  constructive,  change  of  possession  that  is  contem- 
plated.* [Chattel  mortgages  on  growing  crops  do  not  in- 
crease the  risk  until  the  crops  are  harvested.^]  And  the 
ordinary  going  out  of  one  tenant  is  not  a  change  of  tenancy 
till  the  advent  of  a  new  tenant;  nor  does  the  vacancy  dur- 
ing the  intervening  time  constitute  a  change  of  occupancy. 
Thus,  under  a  provision  that  "if  any  change  be  made  as  to 
the  tenants  or  occupancy  of  the  premises,"  without  notice, 
the  policy  shall  be  void,  the  fact  that  the  premises  were 
unoccupied  at  the  time  of  the  fire,  the  tenant  having  vacated 

1  Soye  V.  Merchants'  Ins.  Co.,  6  La.  An.  761. 

2  Luce  V.  Dorchester  Ins.  Co.,  105  Mass.  297. 

3  Phila.  Fire  &  Life  Ins.  Co.  v.  Mills,  44  Pa.  St.  241. 

*  Com.  Ins.  Co.  v.  Berger,  42  Pa.  St.  285.     And  see  post,  §  274. 
5  [Tiefenthal  v.  Citizens'  Mut.  Fire  Ins.  Co.,  53  Mich.  306.] 

intended  to  continue  for  three  months,  "vacant  by  the  removal  of  the  occu- 

when  there  is  no  change  in  the  interior  pant,"  see  Stone  v.  Granite  State  F.  Ins. 

furnishings ;  but  the  question  is  one  of  Co.  (N.  H. ),  45  Atl.  235  ;  Johnson  v. 

fact   for   the   jury.      Stone  v.   Granite  Norwalk  F.  Ins.  Co.  (Mass.),  56   N.  E. 

State  F.  Ins.  Co.  (N.  H.),  45  Atl.  235.  569. 
As   to   the  meaning  of   the    clause 

500 


CH.  XI.]      SPECIAL   PfiOVISIONS   OF   THE   CONTRACT,   ETC.  [§  249  A 

the  premises  but  a  few  days  previous,  and  no  new  tenant 
having  taken  possession,  no  notice  at  all  is  necessary  until 
the  change  takes  place;  that  is,  until  a  new  tenant  is  in 
possession.  A  mere  surrender  of  one  tenant  without  the 
entry  of  another  is  not  such  a  change  as  is  contemplated  by 
the  words  of  the  proviso. ^  Nor  is  the  leaving  a  building 
unoccupied  after  it  has  been  vacated  by  a  tenant  an  altera- 
tion of  the  use  to  which  the  premises  are  applied.  ^  On 
the  other  hand,  it  is  not  sufficient  to  constitute  occupancy, 
within  the  meaning  of  a  stipulation  that  the  property  in- 
sured—  a  trip-hammer  shop  —shall  not  remain  unoccupied 
over  thirty  days,  that  the  tools  remain  in  the  shop,  and  an 
employee  of  the  insured  goes  almost  every  day  through  the 
shop  to  look  around  and  see  if  everything  is  right,  but  no 
practical  use  is  made  of  the  building. ^ 

[§  249  A.  Scope  of  the  Terms  "Vacant"  and  "Unoccu- 
pied." —  Vacant  and  unoccupied  are  not  synonymous,  and 
both  facts  must  concur  to  render  a  policy  void.  Vacant 
means  empty  of  everything  but  air;  wherefore  a  house  full 
of  furniture,  clothing,  &c.,  left  in  charge  of  servants,  is  not 
vacant.  Unoccupied  means  that  no  one  has  the  actual  use 
or  possession.*  The  words  must  be  construed  with  refer- 
ence to  the  kind  of  structure  or  building  insured.  As  to  a 
saw-mill,  total  abandonment  seems  to  be  necessary.^  Oc- 
cupancy means  actual  use  as  a  dwelling-house,  and  leav- 
ing some  one  to  look  after  the  house  is  not  a  sufficient 
substitute  for  the   care    and  supervision  involved  in   occu- 


1  McAnnally  v.  Somerset  County  Mut.  Ins.  Co.,  2  Pittsburgh  Rep.  (Crumrine) 
189  ;  Alston  y.Old  North  State  Ins.  Co.,  80  N.  C.  326  ;  8  Ins.  L.  J.  428.  [A 
stipulation  against  change  of  tenants  or  use  of  premises  does  not  render  the  policy 
void  by  reason  of  a  change  to  no  tenant  and  no  use.  Somerset  County  Mut.  Fire 
Ins.  Co.  V.  Usaw,  112  Pa.  St.  80.]  But  under  such  facts,  a  provision  in  the 
policy  that  its  protection  shall  be  suspended  while  the  house  should  be  unoccu- 
pied, was  held  to  apply  to  a  vacancy  of  six  days  between  the  outgoing  and  in- 
coming tenants,  the  latter  having  waited  for  repairs.  yEtna  Ins.  Co.  v.  Meyers, 
63  Ind.  238  ;  s.  c  and  note,  8  Ins.  L.  J.  249  ;  ante,  §  191. 

2  Hawkes  v.  Dodge  County  Mut.  Ins.  Co.,  11  Wis.  188. 

3  Keith  V.  Quincy  Mut.  Fire  Ins.  Co.,  10  Allen  (Mass.),  228. 

*  [Herrman  v.  Merchants'  Ins.  Co.,  44  N.  Y.  Super.  444,  453.] 
6  [Whitney  v.  Black  River  Ins.  Co.,  9  Hun,  37,  42.] 

501 


§  249  A]        INSUEANCE  :    FIKE,   LIFE,   ACCIDENT,   ETC.  [CH.  XI. 

pancy.^  Leaving  a  dwelling  furnished  and  in  charge  of  his 
fanner  who  occupied  the  farmhouse  near  by,  and  whose  wife 
visited  and  aired  the  dwelling  every  few  days,  will  not  satisfy 
the  condition  of  occupancy.  The  house  must  be  used  by 
human  beings  as  their  customary  place  of  abode. ^  In  case  of 
a  saloon  it  is  enough  if  at  the  time  of  loss  a  clerk  having 
charge  of  the  building  was  occupying  it  with  appropriate 
furniture,  fitting  it  up  for  business 'and  sleeping  in  it.^  A 
purpose  to  move  into  the  house,  though  partly  executed  by 
filling  it  with  furniture,  will  not  aid  the  assured  unless  the 
purpose  is  rendered  complete  by  actual  occupancy.  If  the 
premises  become  unoccupied  and  remain  so  up  to  and  at 
the  time  of  the  fire,  the  condition  is  broken.*  A  condition 
in  a  policy  of  insurance  on  a  hog-house  that  the  policy 
should  be  void  if  the  premises  became  vacant  by  the  removal 
of  the  owner  or  occupant,  refers  to  the  human  occupant  of 
the  whole  premises  to  which  the  hog-house  belongs,  and  not 
to  the  absence  of  hogs,  of  the  four  legged  variety. ^  Where 
the  occupant  moved  out  leaving  only  a  bedstead  and  a  strip 
of  carpet,  and  one  of  his  sons  slept  in  the  house  for  a  month 
after,  but  afterward  the  house  was  entirely  abandoned  for 
six  or  seven  weeks  before  the  fire,  the  court  held  the  prem- 
ises vacant,  and  the  policy  void  not  only  as  to  the  house  but 
also  as  to  all  the  farm  buildings  insured,  since  the  condition 
as  to  occupancy  of  the  premises  applies  to  all  the  subjects 
of  the  contract,  and  has  a  potent  influence  on  the  assump- 
tion of  the  entire  risk.^  If  the  policy  covers  several  build- 
ings, as  a  dwelling  and  outbuildings,  the  fact  that  the 
outbuildings  remain  occupied  will  not  save  the  contract  if 
the  dwelling  becomes  vacant;  the  condition  is  to  be  applied 
distributively.'^] 

1  [Bonenfant  v.  Insurance  Co.,  76  Mich.  654,  659,  citing  55  Mich.  292,  and 
Ashworth  v.  Insurance  Co.,  112  Mass.  422.] 

2  [Herman  v.  Adriatic  Fire  Ins.  Co.,  85  N.  Y.  162.] 

3  [Stensgaard  v.  National  Fire  Ins.  Co.,  36  Minn.  181.] 
*  [Harry  v.  Prescott  Ins.  Co.,  35  Hun,  601,  604-605.] 

5  [Kimball  v.  Monarch  Ins.  Co.,  70  Iowa,  513.] 

6  [Hartshorne  v.  Agricultural  Ins.  Co.,  50  N.  J.  427,  429.] 

7  [Herrman  v.  Adriatic  Fire  Ins.  Co.,  85  N.  Y.  163.] 

502 


CH.  XI.]      SPECIAL   PROVISIONS    OF   THE   CONTEACT.   ETC.    [§  249  B 

[§  249  B.  Vacancy  not  per  se  an  Increase  of  Risk  under 
Ordinary  Circumstances.  —  Ordinarily  vacancy  is  not  such  an 
increase  of  risk  as  will  avoid  a  policy,  without  express  agree- 
ment to  that  effect.^  A  building  occupied  as  a  dwelling- 
house  one  quarter  mile  away  from  any  other  dwelling,  was 
insured  as  a  dwelling-house,  but  for  more  than  a  year  prior 
to  its  destruction  by  fire  was  untenanted.  This  was  held 
not  to  violate  a  condition  in  the  policy,  reading  "Any  mate- 
rial increase  of  the  risk  shall  avoid  the  policy."  ^  No 
inquiry  being  made,  a  failure  to  state  that  the  dwelling 
insured  is  vacant  is  not  breach  of  the  condition  avoiding  the 
policy  for  the  omission  of  anything  material  to  the  risk.^ 
When  the  policy  contains  no  stipulation  or  condition  against 
vacancy  of  the  insured  premises  it  is  incompetent  to  ask  an 
expert  if  the  risk  on  a  dwelling-house  is  increased  by  its 
vacancy.*  And  it  is  error  to  charge  that  if  the  house  was 
vacant  and  if  you  believe  the  risk  was  thereby  increased,  the 
policy  is  void.^  But  where  a  dwelling-house  was  abandoned 
by  the  assured,  and  an  intruder  came  in  and  used  it  for  a 
liquor  saloon  during  which  use  it  was  burned,  the  policy 
was  avoided  by  the  increase  of  risk.^  A  mere  casual  vacancy 
caused  by  the  difficulty  of  procuring  a  tenant  for  the  insured 
house,  ought  not  to  work  a  forfeiture  of  a  policy ''  as  an 
increase  of  risk,  and  it  is  understood  that  in  the  absence 
of  a  warranty  the  companies  expect  to  cover  such  cases  of 
temporary  vacancy.  If  a  house  is  insured  as  a  tenement, 
temporary  vacancies  are  contemplated  by  the  parties  as  a, 
part  of  the  risk.^  In  a  later  case  the  court  held  that 
although  the  house  was  described  as  occupied  by  a  tenant, 
yet  the  leaving  of  the  tenant  at  six  o'clock  in  the  evening 

^  [Becker  v.  Farmers'  Mut.  Fire  Ins.  Co.,  48  Mich.  610  ;  Residence  Fire  Ins. 
Co.  V.  Hannawold,  37  Mich.  103,  107.] 

2  [Gilliat  V.  Fawtucket  Mut.  Fire  Ins.  Co.,  8  R.  I.  282,  293.] 

3  [Browning  v.  Home  Ins.  Co.,  71  N.  Y.  508,  511.] 

*  [Liverpool,  &c.  Ins.  Co.  w.  McGuire,  52  Miss.  227,  232.] 
s  [Insurance  Co.  v.  Long,  51  Tex.  89.] 

6  [Western  Ass.  Co.  v.  McPike,  62  Miss.  740.] 

7  [Schultz  ?;.  Merchants'  Ins.  Co.,  57  Mo.  331,  337.] 

^  [Lockwood  V.  Middlesex  Mut.  Ins.  Co.,  47  Conn.  553.  See  also  Insurance 
Co.  V.  Hannuni,  11  xMonaghan  (Pa.),  369.] 

503 


§  249  Cj  INSUEANCE :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  XI. 

avoided  the  policy  at  once,  and  no  recovery  could  be  had  for 
a  loss  occurring  at  two  o'clock  the  next  morniuo-.i  The 
cases  differ  in  the  fact  that  in  the  former  there  was  no 
specific  provision  that  the  policy  should  be  void  by  vacancy, 
while  in  the  latter  there  was  such  a  provision.  In  the  early 
case  the  vacancy  could  only  avoid  the  policy  as  an  increase 
of  risk  not  contemplated  by  the  parties.  In  a  still  later 
hearing  of  the  Bennett  case  it  was  held  that  the  policy  was 
not  saved  by  the  fact  that  the  fire  had  actually  commenced, 
and  was  smouldering  unobserved  when  the  tenant  moved 
out.  2] 

[§  249  C.    Vacant.  —  A  vessel  hauled  up  on  the  beach  and 
left  alone  is  "unoccupied."  ^     A  house  that  remains  three 
months  vacant  and  is  then  let  to  a  tenant  who  up  to  the  loss 
had  done  nothing  but  put  into  it  implements  for  cleaning, 
is  unoccupied  within  the  meaning  of  the  policy.*     When  a 
policy  provided  that  if  the  insured  house  should  be  "vacant 
or  unoccupied  "  it  should  be  void,  it  was  held  that  a  vaca- 
tion of  five  days  during  the  time  only,  that  was  necessary 
for  the  changing  of   tenants  of   the  assured,   when  the  fire 
occurred  within  that  time,  avoided  the  policy. ^    Leaving  a 
few  articles  in  the  house,  and  non-delivery  of  the  key  by  the 
outgoing  tenant  to  the  owner,   will  not  save  the  vacancy. ^ 
The  mere  presence  of  goods  in  the  house  and  a  supervision 
over  it  is  not  an  "  occupancy. "     That  requires  a  "  living  "  in 
it.^     Where  the  tenant  moved  out  September  26  and  a  fire 
occurred  October  1st,  and  the  owner  who  lived  a  mile  and  a 
half  away  had  spent  a  part  of  each  intervening  day  in  clean- 
ing the  house,  but  did  not  stay  there  at  night,  the  house  was 
held  vacant. 8     Occupation  of  the  land  on  which  the  building 

1  [Bennett  v.  Agr.  Ins.  Co.,  50  Conn.  420.] 

2  [.51  Conn.  504.] 

8  [Reid  V.  Lan.  Fire  Ins.  Co.,  90  N.  Y.  382.] 

♦  [Litch  V.  North  British,  &c.  Ins.  Co.,  1-36  Mass.  491.] 

5  [Ridge  V.  Insurance  Co.,  9  Lea,  507,  515.] 

6  [American  Ins.  Co.  v.  Padfield,  78  111.  167  ;  Corrigan  v.  Conn.  Fire  Ins.  Co., 
122  Mass.  298,  300.] 

^  [Craig  V.  Springfield  Fire  &  Mar.  Ins.  Co.,  34  Mo.  App.  4S1  ;  Moore  v.  lu- 
.surance  Co.,  64  X.  H.  140  ;  Sonneboru  v.  Insurance  Co.,  44  X.  J,  220.] 
8  [Feshe  v.  Council  Bluffs  Ins.  Co.,  74  Iowa,  676  ] 
504 


CH.  XI.]      SPECIAL    PROVISIONS   OF   THE   CONTKACT,   ETC.   [§  249  D 

is  situated  is  not  enough.     The  word   "premises"   in  the 
vacancy  clause  refers  to  the  house. i] 

[§  249  D.    Not  Vacant.  — Temporary  absence  of  the  dweller 
or  tenant  on  the  night  of  the  fire  is  not  a  vacancy,  ^     A  tem- 
porary absence   from   Wednesday  till    Monday  to  attend    a 
funeral  is  not  a  vacating  of  the  premises  that  will  avoid  the 
policy.^      It  is  sufficient  for  occupancy  if   a  single  person 
remains  in  the  house,  though  described  at  the  time  of  insur- 
ance as  a  "family  residence."*     Mere  sleeping  in  an  adjoin- 
ing house,  if  by  day  the  assured  lives  in  the  insured  premises, 
will  not  break  the  "vacant  or  unoccupied"  condition  in  a 
policy.^     When   the   assured   had   taken    possession    of   the 
house  for  the  purpose  of  permanent  occupancy,  had  moved 
in  her  furniture  and  goods,  and  was  cleaning  up  the  house 
preparatory  to  living  in  it,  it  was  held  that  the  house  was 
not  "vacant  or  unoccupied  "  *^  although  she  slept  in  a  build- 
ing a  few  rods  distant,  and  did  not  eat  or  sleep  in  the  house, 
and  after   a  few  days  went   off   on  a  business  trip  during 
which  the  house  was  burned.^     Where  a  tenant  moved  out 
on  Tuesday,  and  the  landlord  on  Wednesday  took  possession 
with   his   servants   and    began    clearing   and   moving  goods 
into  the  building  until  Friday  night,  intending  to  have  the 
family  fully   domiciled    there    on    Saturday,    but  on  Friday 
night  the  house  burned,  it  was  held  that  the  house  was  not 
vacant.^    When  a  "ten  tenement  frame  block"  has  two  of 
its  tenements  occupied,    it   is  not   "  vacant  or  unoccupied  " 
so  as  to  break  that  condition   in  a  polic}'.^     A  grain  ele- 
vator, though  at  times  not  in  use,  is  not  vacant  when  men 
are  in  and  out  all  the  time  and  the  owner  keeps  his  papers 
there.  10] 

^  [Sexton  V.  Hawkeye  Ins.  Co.,  69  Iowa,  99.] 

2  [Laselle  V.  Insurance  Co.,  43  N.  J.  L.  468.] 

8  [Franklin  Fire  Ins.  Co.  v.  Kepler,  95  Pa.  St.  492.] 

*  [Iiiipcrial  Fire  Ins.  Co.  v.  Kiernan,  83  Ky.  468.] 

6  [(iibbs  V.  Continental  Ins.  Co.,  13  Hun,  611,  620.] 

«  [Sliackelton  v.  Sun  Fire  Office,  21  N.  W.  Rep.  343,  345.] 

'  [Shackelton  v.  Sun  Fire  Office,  55  Mich.  288.] 

8  [Eddy  V.  Hawkeye  Ins.  Co.,  70  Iowa,  472.] 

9  [Harrington  v.  Fitohburg  Ins.  Co.,  124  Mass.  126,  129.] 

10  [Williams  v.  North  German  Ins.  Co.,  24  Fed.  Rep.  625  (Iowa),  1885.] 

505 


^  249  F]        INSURANCE  :   FIRE,    LIFE,   ACCIDENT,    ETC.  [CH.  XL 

[S  249  E.  Vacant  and  so  Remain.  —  Under  a  condition 
that  "if  the  assured  shall  allow  the  building  to  become 
vacant  and  unoccupied  and  remain  so,"  the  policy  shall  be 
void,  the  mere  occurrence  of  a  vacancy  does  not  forfeit  the 
policv;  the  building  must  remain  vacant.  If,  however,  it  is 
not  occupied  within  a  reasonable  time,  the  company  may 
declare  the  contract  forfeited.  If  the  company  does  not 
exercise  its  power  during  the  breach  of  condition  and  the 
premises  again  become  occupied,  its  right  to  declare  a  for- 
feiture ceases.  In  relation  to  such  a  clause,  knowledge  of 
the  agent  at  the  time  of  consenting  to  a  transfer,  that  the 
premises  were  vacant,  but  without  proof  of  consent  that  they 
should  remain  so,  could  not  estop  the  company  in  a  case 
where  the  building  was  vacant  twenty  months  and  then 
destroyed  by  fire.^  A  clause  stating  that  if  the  insured 
house  "become  unoccupied  or  vacant  and  so  remain  "  means 
so  remain  until  the  fire.^  And  a  vacancy  cannot  avail  the 
company  if  it  ceased  before  loss.^] 

r§  249  F.  Tenant's  Removal.  Diligence  of  assured  does  not 
enter  the  question  unless  so  expressed,  where  the  policy  is 
to  be  void  if  the  premises  become  vacant.  It  is  error  to 
instruct  that  if  the  insured  used  due  diligence  to  keep  the 
building  occupied  the  policy  was  not  avoided.*  The  perma- 
nent removal  of  a  lessee,  though  during  his  lease  and  with- 
out knowledge  of  the  insured,  will  be  fatal  under  the 
ordinary  provision.^  But  where  the  policy  was  to  be  void 
"  if  the  premises  shall  be  used  or  occupied  so  as  to  increase 

the  risk,  or  be  or  become  vacant  or  unoccupied,  or 

or  or ,  or  by  any  means  within  the  knowledge 

and  control  of  the  assured,"'  it  was  held  that  the  latter 
clause  modified  all  the  preceding,  and  that  the  removal  of 
a  tenant  on  the  day  of  the  fire  without  knowledge  of  the 
insured  did  not  avoid  the  policy.^     When  a  policy  prohibits 

i  [Insurance  Co.  v.  Garland,  108  111.  220.] 
2  [Laselle  v.  Insurance  Co.,  43  X.  J.  L.  468,  469.] 
8  [Laselle  v.  Insurance  Co.,  43  X,  J.  L.  468.] 
*  [Niagara  Fire  Ins.  Co.  v.  Drda,  19  Brad.  70.] 

5  [Insurance  Co.  v.  Wells,  42  Ohio  St.  519,  521.] 

6  [American  Cent.  Ins.  Co.  v.  Clarev,  28  Brad.  198.] 

506 


CH.  XI.]    SPECIAL   PKOYISIOXS    OF   THE   CONTRACT,   ETC.     [§  249  H 

the  vacation  of  the  insured  house  by  the  insured's  consent, 
it  is  incumbent  on  the  assured  to  prove  that  such  a  vacation 
when  established,  was  beyond  his  control,  before  he  can 
recover,  ^j 

[§  249  G.  Answer ;  Reoccupancy  before  Fire  ;  Unreasonable 
Condition  ;  Prior  By-law  ;  Maine  Statute.  —  An  answer  in  the 
application  clearly  false  as  to  the  occupancy  of  the  premises 
will  prevent  recovery.^  A  policy  once  avoided  by  non- 
occupancy  for  ten  days,  will  not  be  revived  by  reoccupation.^ 
A  lot  of  distillery  buildings,  presumably  available  for  no 
other  use,  and  unoccupied  at  the  time  of  the  issurance  of  the 
policy,  were  insured,  the  policy  stating  that  it  should  be 
avoided  by  vacancy  or  disoccupancy,  but  expressly  covering 
a  carpenter's  risk,  and  also  expi'essly  prohibiting  the  dis- 
tillery business.  The  carpenter's  work  was  finished  before 
the  expiration  of  the  policy  and  the  buildings  remained  un- 
occupied, but  it  was  held  that  the  company  would  not  be 
heard  to  say  that  the  policy  was  forfeited.^  Practically  the 
condition  forfeited  the  policy  in  any  event.  If  the  property 
was  used  for  a  distillery  there  was  forfeiture.  It  could  not 
probably  be  used  for  anything  else,  and  yet  if  it  was  not 
forfeiture  also  would  result,  —  a  condition  too  unreasonable 
to  stand.  By-laws  cannot  destroy  express  contracts.  Exist- 
ing regulations  enter  into  the  agreement,  but  although  a 
policy  is  declared  to  be  subject  to  the  charter  and  by-laws, 
a  by-law  to  the  effect  that  policies  shall  cease  on  twenty 
days'  vacancy  of  the  building  insured  does  not  affect  a 
policy  issued  prior  to  its  enactment.^  By  the  Maine  statute, 
vacating  a  building  will  not  affect  the  policy  unless  the  risk 
is  materially  increased  thereby.^] 

[§  249  H.  Express  Waiver.  —  When  the  assured  moved  out 
of  the  insured  premises  more  than  thirty  days  before  the  fire 
occasioning  the  loss,  in  violation  of  the  stipulations  of  the 

1  [N"ortli  American  Fire  Ins.  Co.  v.  Zrenger,  63  111.  464,  466.] 

2  [Mullin  V.  Vt.  Mut.  Fire  Ins.  Co.,  54  Vt.  223.] 

3  [Moore  v.  Insurance  Co.,  62  N.  H.  240.] 

*  [Alkan  v.  New  Hampshire  Ins.  Co.,  53  Wis.  136,  142.] 

5  [Becker  v.  Farmers'  Mut.  Fire  Ins.  Co.,  48  Mich.  610.] 

6  [Tha3'er  v.  Providence,  &c.  Ins.  Co.,  70  Me.  531,  538.] 

507 


§  249  H]       INSURANCE  :   FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  XI. 

policy,  but  at  the  time  went  to  the  secretary  of  the  company 
and  notified  him  of  the  same,  he  replying  "We  waive  all 
that,"  it  was  held  that  the  policy  was  good.i  A  general 
agent  is  presumed  to  have  authority  to  insert  in  the  policy 
permission  that  the  premises  may  he  vacant  for  a  certain 
time.^  And  he  may  do  the  same  orally,  although  the  policy 
requires  indorsement,  or  even  bind  the  company  as  to  future 
vacancies  by  modifying  the  contract. 

A  general  agent  of  an  insurance  company  may  waive  the 
performance  by  the  insured  of  conditions  in  the  policy,  and 
bind  the  company  by  such  waiver.  Hence,  when  the  policy 
declared  that  a  waiver  of  the  "  vacant  or  unoccupied  "  clause 
should  not  avail  unless  indorsed  on  the  policy,  a  general 
agent  by  verbal  agreement  with  the  insured  was  held  to 
have  legally  waived  this  condition.^  In  this  case  the  general 
agent  told  the  insured  distinctly  that  it  was  not  necessary  to 
have  the  matter  indorsed  on  the  policy.  Where  premises 
were  not  to  be  left  unoccupied,  but  on  the  day  a  vacancy 
occurred  a  general  agent  of  the  company,  being  told  of  it, 
wrote  in  the  policy,  "The  dwelling-house  being  unoccupied 
for  a  short  time,  but  being  in  charge  of  a  trusty  person  liv- 
ing near  by,  shall  be  no  prejudice  to  the  policy,"  it  was 
held  that  this  was  a  modification  of  the  contract  that  cov- 
ered other  vacancies  afterward  occurring.*  In  one  case,  a 
farm  tenant  left,  and  the  owner  told  the  agent  that  his  men 
would  work  the  farm  with  other  land,  moving  from  faiiu  to 
farm,  and  while  on  the  farm  in  question  would  live  in  the 
buildings  thereon.  The  agent  then  indorsed  on  the  policy, 
"  It  is  understood  that  the  buildings  insured  hereunder  are 
now  occupied  for  dwelling  and  farming  purposes."  It  was 
held  that  the  premises  were  not  occupied  within  the  mean- 
ing of  the  indorsement.  Taylor  and  Orton,  JJ.,  however 
dissented,  and  with  much  reason.  It  is  absurd  to  allow  an 
agent  to  make  an  indorsement  expressly  to  announce  that  a 

1  [Adams  v.  Greenwich  Ins.  Co.,  9  Hun,  45,  48.] 

2  [Continental  lus.  Co.  v.  Ruckman,  127  111.  364.] 

8  [Walsh  V.  Hartford  Fire  Ins.  Co.,  9  Hun,  421,  423.] 
*  [Steeu  V.  Niagara  Fire  Ins.  Co.,  89  N.  Y.  315.] 

'508 


CH.  XI.]      SPECIAL    PROVISIONS    OF   THE    CONTRACT,   ETC.     [§  249  I 

certain  state  of  facts  shall  be  considered  an  occupancy,  and 
then  hold  that  state  of  facts  7wt  an  occupancy  within  the 
meaning  of  the  agent's  indorsement.^  A  permission  to 
leave  a  house  vacant  during  the  "summer"  will  be  con- 
strued in  its  broadest  sense,  and  as  equivalent  to  "  farming 
season."  ^J 

[§  249  I.  Knowledge  of  Agent.^  —  If  at  the  time  of  loss 
the  occupancy  of  the  premises  is  in  the  same  condition  as 
was  known  to  the  agent  at  the  time  of  insurance,  the  com- 
pany is  estopped  even  though  the  applicant  ignorantly 
signed  an  application  filled  in  by  the  agent  containing  an 
erroneous  statement  on  the  subject.  But  if  the  premises 
once  become  occupied  after  insurance,  the  condition  takes 
effect,  and  if  the  agent  on  knowing  of  a  vacancy  occurring 
after  insurance  tells  the  assured  that  it  will  invalidate  the 
policy,  or  he  is  merely  silent,  the  company  is  not  estopped. 
Nor  will  knowledge  that  a  vacancy  will  be  likely  to  occur, 
as  in  case  of  a  tenement  or  summer-house,  estop  the  insurer. 

If  the  agent  knew  the  house  was  vacant  when  insured,  the 
company  cannot  claim  a  forfeiture  under  the  occupancy 
clause.*  Knowledge  of  the  agent  is  knowledge  of  the  prin- 
cipal, and  if  the  agent  knows  the  house  is  vacant  at  the 
time  of  issuing  the  policy  and  receiving  the  premiums,  the 
condition  of  the  policy  against  vacancy  is  waived.^  Although 
the  house  was  occupied  by  children  only,  a  part  of  each 
week,  and  was  actually  vacant  at  the  time  of  the  fire,  yet  as 
its  occupancy  was  in  the  same  condition  as  it  was  at  the 
time  of  the  insurance,  which  condition  was  then  known  to 
the  agent,  it  was  held  that  the  provision  as  to  vacancy  was 
waived.^  Where  the  applicant  stated  that  the  premises 
were  unoccupied,  but  when  occupied  it  was  by  a  tenant,  and 
the  agent  wrote  in  the  application  that  the  premises  were 

1  [Fitzgerald  v.  Conn.  Fire  Ins.  Co.,  64  Wis.  463.] 

2  [Vanderhoffi'.  Agricultural  Ins.  Co.,  46  Hun,  328.] 

3  [See  also  §  246  A,  and  ch.  7,  anal,  5.] 

*  [Germania  Fire  Ins.  Co.  v.  Klewer,  27  Brad.  590  ;  affd  in  129  111.  599.] 

5  [Sentell  v.  Oswego  County  Farmers'  Ins.  Co.,  16  Hun,  518;  Jordan  v.  State 
Ins.  Co.,  64  Iowa,  216.] 

6  [Vanderhoff  y.  Agricultural  Ins.  Co.,  46  Hun,  328.] 

509 


§  249  I]        INSURANCE  :    FIRE,    LIFE,   ACCIDENT,    ETC.  [CII.  XI. 

occupied  by  a  tenant,  and  the  application  was  signed  by  the 
insured  without  knowledge  of  the  misstatement,  it  was  held 
that  the  policy  was  not  void,  under  the  clause  against 
vacancy  without  assent;  that  the  company  must  be  held  to 
have  known  of  the  non-occupancy;  that  the  policy  really 
was  an  insurance  of  unoccupied  premises;  that  it  was  proper 
to  amend  the  application  so  as  to  make  it  conform  to  the 
insured's  statement  to  the  agent;  and  that  a  subsequent 
vacancy  after  an  intervening  tenancy  would  not  avoid  the 
policy,  as  it  insured  the  building  vacant. ^  It  is  error  not 
to  submit  to  the  jury  the  question  of  the  knowledge  of  the 
agent  that  the  premises  were  vacant  and  unoccupied  at  the 
time  of  issuing  the  policy,  contrary  to  its  provisions,  for 
such  knowledge  may  estop  the  company.  The  law  will  not 
impute  the  fraudulent  intent  involved  in  delivering  and 
receiving  pay  for  an  instrument  known  to  be  invalid. ^  But 
although  a  building  may  be  unoccupied  when  insured,  being 
a  new  house  insured  a  few  days  before  completion  and  de- 
scribed as  a  "dwelling-house,  when  completed  to  be  occu- 
pied as  a  private  dwelling-house,"  yet,  if  it  is  once  occupied, 
and  then  left  vacant  for  fourteen  days  without  consent  of 
the  insurer,  during  which  time  a  fire  occurs,  the  condition 
against  vacancy  is  broken. ^  An  agent  of  a  foreign  company 
may  indorse  consent  of  the  company  to  non-occupancy,  or  he 
may  waive  such  indorsement  by  appropriate  acts,  but  mere 
silence  with  knowledge  of  the  fact  is  not  a  waiver.*  Where, 
on  renewing  a  policy  the  agent  was  told  that  the  premises 
were  unoccupied,  and  he  replied  that  the  policy  would  be  of 
no  effect  unless  the  house  should  be  occupied -when  a  fire 
occurred,  and  a  loss  occurred  one  week  after  while  the  prem- 
ises were  still  vacant,  it  was  held  that  the  plaintiff  could 
not  recover.^    Knowledge  of  the  agent  at  the  time  of  insur- 

1  [Bennett  i;.  Agricultural  Ins.  Co.,  106  N.  Y.  243.] 

2  [Short  V.  Home  Ins.  Co.,  90  N.  Y.  16.     See  also  Haight  v.  Continental  Ins. 
Co.,  92  N.  Y.  51.] 

3  [Lubelsky  v.  Royal  Ins.  Co.,  86  Ala.  530  ;  Royal  Ins.  Co.  v.  Lubelsky,  IS 
Ins.  L.  J.  868  (Ala.),  April  9,  1889.] 

*  [Davey  v.  Glens  Falls  Ins.  Co.,  9  Ins.  L.  J.  494  (Minn.),  1879.] 
6  [Hotciikiss  V.  Home  Ins.  Co.,  58  Wis.  297.] 

510 


CH.  XI.]      SPECIAL    PROVISIONS    OF   THE    CONTRACT,   ETC.         [§250 

ance,  that  the  house  although  then  occupied  was  only  used 
as  a  summer  residence,  will  not  relieve  the  insured  from 
the  effect  of  a  subsequent  vacancy. ^  And  so,  though  it  is 
known  that  the  house  was  leased  to  tenants,  and  might 
become  vacant  by  the  occasional  change  of  occupants. '-^  The 
true  meaning  of  such  clauses  is  that  the  policy  is  to  be  void 
during  the  vacancy.  ] 

[§  249  J.  Condition  that  Agent  shaU  not  waive.  —  A  pro- 
vision that  no  agent  can  waive  conditions  will  not  prevent 
waiver  of  a  vacancy  known  by  the  agent  and  treated  as  not 
avoiding  the  policy.3(a)  But  one  having  only  authority 
to  make  surveys  and  receive  applications  cannot  waive  a 
vacancy  of  the  premises  in  such  a  case.*] 

§  250.  Limitation  of  Risk ;  Care  ;  Watch.  —  The  cases  upon 
the  effect  of  a  statement  as  to  circumstances  material  exist- 
ing at  the  time  of  the  making  of  the  contract  are  perplex- 
ingly  conflicting. 

On  the  one  hand,  they  are  held  to  be  mere  statements  of 
existing  facts,  for  the  truth  of  which  alone  the  applicant  is 
responsible,  and  not  warranties  that  the  existing  status  shall 
continue.  So  it  has  been  held  with  reference  to  a  statement 
that  a  mill  "is  never  left  alone,  there  being  always  a  watch- 
man left  in  the  building  when  it  is  not  running,"^  that  an 
account  of  stock  is  taken  once  in  three  months. ^  On  the 
other  hand,  it  has  been  distinctly  and  repeatedly  held  that 
a  statement  that  a  watchman  is  kept  on  the  premises  at 
night  and  all  other  times  when  the  mill  is  not  in  operation, 
or  when  the  workmen  are  not  present,  is  a  warranty  that  the 
practice  shall  continue.'     The  same  doctrine  was  held  also 

1  [Herrman  v.  Adriatic  Fire  Ins.  Co.,  85  N.  Y.  163.] 

2  [Ridge  V.  Insurance  Co.,  9  Lea  (Tenn.),  507.] 

8  [Lamberton  v.  Conn.  Fire  Ins.  Co.,  39  Minn.  130.] 
*  [Thayer  v.  Agricultural  Ins.  Co.,  5  Hun,  566.] 

5  Worswick  v.  Canada  Fire  Ins.  Co.,  3  App.  Rep,  (Ont.)  487;  s.  c.  15  Can. 
L.  J.  N.  s.  22  (1879). 

6  Wynue  v.  Liverpool,  &c.  Ins.  Co.,  71  N.  C.  121 ;  a7ite,  §§  191,  231  ;  post, 
§§  255,  256. 

7  Whitlaw  V.  Phcenix  Ins.  Co.,  28  U.  C.  (C.  P. )  53 ;  Blumer  v.  Phoenix  Ins. 
Co.,  45  Wis.  622.     In  this  case  there  was  a  dissenting  opinion,  and  the  whole 

(a)  See  Anderson  v.  Manchester  F.  Ass.  Co.,  59  Minn.  182. 

511 


§  250]  INSURANCE :   FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  XI. 

in  another  case  in  Wisconsin, ^  where  the  statement  was  that 
the  machinery  was  "regularly  oiled  with  lard  and  sperm  oil 
by  the  engineer  and  miller."  But  as  the  statements  were  to 
be  true  only  so  far  as  material  to  the  risk,  the  case  was 
allowed  to  go  to  the  jury,  on  the  question  whether  the  use  of 
a  different  oil  by  a  different  person  was  a  violation  of  the 
agreement. 2  In  another  very  late  case,^  the  very  unsatisfac- 
tory condition  of  the  law  upon  this  point  was  thus  stated: 
"It  is  impossible  to  reconcile  the  decisions  upon  this  ques- 
tion of  a  continuing  warranty.  When  an  underwriter  asks 
about  the  particulars  of  a  risk,  he  probably  takes  it  for 
granted  that  things  will  remain  as  they  are ;  but  when  the 
courts  are  asked  to  convert  this  impression  into  a  covenant, 
and  make  words  in-the  present  tense  operate  as  a  stipulation 
for  the  future,  there  is  difficulty,  and  the  authorities  are 
doubtful  and  divided.  The  result,  so  far  as  I  can  gather  it, 
is  that  when  the  fact  appears  to  the  courts  to  be  a  very 
important  one,  such  as  the  employment  of  a  watchman,  a 
majority  of  them  have  said  that  this  ought  to  be  considered 
a  part  of  a  continuing  engagement.  When  the  fact  does  not 
appear  to  be  so  important,  as  that  a  dwelling-house  is  occu- 
pied, or  that  a  clerk  sleeps  in  the  store,  it  is  not  of  that 
character."  It  is  obvious  that  the  test  here  given  —  the 
greater  or  less  importance  of  the  fact  —  is  practically  no  test 
at  all;  and  it  is  to  be  regretted  that  there  has  been  any 
departure  from  the  salutary  rule  that  the  courts  will  not  find 
warranties  where  the  parties  have  not  clearly  made  them.  It 
would  have  been  fortunate  if  they  had  found  more  difficulty  in 
converting  "impressions"  or  expectations  into  covenants.* 

subject  was  very  elaborately  discussed,  especially  in  the  dissenting  opinion,  and 
upon  reargument  tbe  decision  was  affirmed.  9  Ins.  L.  J.  444.  See  also  May  v. 
Buckeye  Ins.  Co.,  25  Wis.  291. 

1  Redman  v.  Hartfo7d  Fire  Ins.  Co.  (Wis.),  9  Ins.  L.  J.  222.  See  also  Gar- 
celon  V.  Insurance  Co.,  50  Me.  580. 

2  See  also  post,  §§  251,  252  ;  Miller  v.  Germania  Fire  Ins.  Co.,  C.  C.  P.  (Pa.), 
6  Ins.  L.  J.  373  ;  Quin  v.  National  Ass.  Co.,  J.  &  C.  (Irish)  316;  s.  c.  1  Bennett 
Fire  Ins.  Cas.  689. 

3  Albion  Lead  Works  v.  Williamsburg  City  Fire  Ins.  Co.,  C.  Ct.  (Mass.), 
Lowell,  J.,  2  Fed.  Rep.  479. 

*  See  ante,  §  191.  National  Bank  v.  Insurance  Co.,  95  U.  S.  673,  678  ;  Ger- 
hauser  v.  North  British,  &c.  Ins.  Co.,  7  Nev.  174. 

512 


CH,  XI.]      SPECIAL    PROVISIONS    OF   THE    CONTRACT,    ETC.         [§  250 

When  it  is  warranted  that  a  watchman  shall  be  kept  on 
the  premises,  this  means  that  a  watchman  is  to  be  kept 
in  the  manner  in  which  men  of  ordinary  care  and  skill  in 
similar  departments  keep  a  watchman;  and  to  show  this, 
evidence  of  the  usage  in  similar  establishments  may  be 
introduced.  A  substantial  compliance,  though  not  a  con- 
stant watch,  uninterrupted  either  by  unknown  accident  or 
negligence,  is  required.^  (a)  And  an  occasional  leaving  of 
the  premises  to  look  after  property  on  the  opposite  side  of 
the  street  is  no  breach  of  the  warranty.^  And  if  the  watch- 
man is  within  the  enclosure  he  is  ''on  the  premises."^ 
What  is  a  "suitable  watch"  depends  upon  the  circum- 
stances.* In  Massachusetts,  the  questions  arose  in  Parker 
V.  Bridgeport  Insurance  Company,^  what  constituted  a  good, 

1  Crocker  v.  People's  Mut.  Fire  Ins.  Co.,  8  Cush.  (Mass.)  79. 

2  Hovey  v.  Am.  Mut.  Ins.  Co.,  2  Duer  (N.  Y.  Superior  Ct.),  554. 
8  Andes  Ins.  Co.  v.  Shipman,  77  111.  189. 

*  Percival  v.  Maine  Mut.  Ins.  Co.,  33  Me.  242. 

5  10  Gray  (Mass.),  302.  The  case  was  thus  stated  by  Shaw,  C.  J.  :  — 
"  In  a  policy  of  insurance  upon  a  saw-mill,  the  assured  covenanted  '  that  the 
representation  given  in  the  application  for  this  insurance  contains  a  just,  full,  and 
true  exposition  of  all  the  facts  and  circumstances  in  regard  to  the  condition,  sit- 
uation, value,  and  risk  of  the  property  insured,  so  far  as  the  same  are  known  to 
the  assured  and  material  to  the  risk  ;  and  that  if  any  material  fact  or  circumstance 
shall  not  have  been  fully  represented,  the  risk  hereupon  shall  cease  and  determine, 
and  the  policy  be  null  and  void.'  The  applicant,  to  the  questions,  '  Is  a  watch 
kept  upon  the  premises  during  the  night  ?  Is  any  other  duty  required  of  the 
watchman  than  watching  for  the  safety  of  the  premises  ? '  answered,  '  A  good 
watch  kept ;  men  usually  at  work.  Watchmen  work  at  the  saws  ;'  and  answered 
in  the  negative  this  question  :  '  Is  the  building  left  alone  at  any  time  after 
the  watchman  goes  off  duty  in  the  morning  till  he  returns  to  his  charge  in  the 
evening  ? '  In  fact,  no  watch  was  ever  kept  on  the  premises  after  twelve  o'clock 
on  Saturday,  or  at  all  on  Sunday,  night,  other  than  the  workmen  sleeping  there, 
who  were  instructed  to,  and  habitually  did  examine  the  mill  with  inference  to 
fires  before  going  to  bed ;  and  the  fire  occurred  on  Sunday  night,  when  no  one  was 

(«)    See  London  &  Lancashire  F.  Ins.  by  the  law  of  that  State.     King  Brick 

Co.   V.  Gerteson  (Ky.),  51  S.  W.  617-  Manuf.   Co.   v.    Phoenix   Ins.    Co.,   164 

The  words  "  constant  watch  "  in  a  policy  Mass.  291.     "  Constant  watch  "  required 

may  amount  to  a  description  of  the  risk,  by  a  fire  policy  may  thus  relate  to  a  per- 

and,  if  so,  under  a  statute  like  that  of  manent  or  habitual  change  in  the  use  or 

the  State  of  Maine,  they  constitute  a  occupation  of  the  property,  and  not  to 

representation  and  not  a  warranty.    Day  the  temporary  absence  of  a  watchman 

V.  Dwelling-House  Ins.  Co.,  81  Maine,  without  the  insured's  knowledge.    King 

244.    And  where  property  so  insured  was  Brick  Manuf.  Co.  v.  Phcenix  Ins.  Co., 

situated  in  Maine,  and  the  policy  was  164  Mass.  291. 
theri'  issued,  it  was  elsewhere  construed 

VOL.  T.— 33  513 


§251]         insurance:  fire,  life,  accident,  etc.         [ch.  xi. 

suitable,  or  proper  watch,  and  whether  such  a  one  was  kept, 
at  tlie  times  required  by  the  terms  of  the  contract;  they  were 
held  to  be  questions  for  the  jury. 

§  251.     Limitation  of  Risk ;   Care  of  Premises  ;  "Watchman.  — 
Several  other  cases  upon  the  meaning  of  a  warranty  to  keep 

on  the  premises.     The  inquiry  is  not  as  to  watchman  or  watchmen  ;    the  more 
generic  term  '  watch  '  embracing  the  various  modes  of  watching  such  a  factory. 
It  was  a  factory  the  machinery  of  which  was  driven  by  water  ;  no  steam  was  used  ; 
it  was  not  a  manufactory  of  metals,  or  one  that  required  the  use  of  fire.     Upon  an 
examination   of  the  bill  of  exceptions,  it  appears  to  us  that  there  were  several 
points  ruled  positively  as  matter  of  law  which  should  have  been  left  to  the  jury  ; 
and  this  on  several  gi'ounds.     In  the  first  place,  if  there  was  not  an  absolute  stipu- 
lation that  a  watch  should  be  kept  during  the  whole  of  every  night  in  the  week' 
such  a  watch  as  would  be  necessary  and  proper  to  the  safety  of  such  an  establish- 
ment against  tire,  then  it  was  a  question  of  fact  whether  the  watch  actually  kept 
was  or  not  a  good  and  suitable  watch.     (Crocker  v.  People's  Mut.  Fire  Ins.  Co., 
8  Cush.  (Mass. )  79.     See  also  Jones  Manufacturing  Co.  v.  Manufacturers',  &c.  Ins. 
Co.,  8  Cush.  (Mass.)  82;  ante,  §  188.)     If  there  is  a  real  difference  between  the 
requirement  of  a  watch  immediately  after  a  working  day,  and  Sunday,  which  is  a 
day  of  rest,  then  a  watch  miglit  be  deemed  good  and  adequate  on  Sunday  night, 
M'hich  might  not  be  after  a  working  day.     The  causes  of  danger  of  fire  in  a  factory, 
we  suppose,  are  lamps  and  stoves,  after  work  is  done  ;  friction,  arising  from  the 
great  velocity  and  irregular  action  of  working  machinery  ;    spontaneous  combus- 
tion ;   incendiaries;    and  lightning.     The  last,  of  course,  no  watch  could  affect; 
the  three  first,  perhap'^  the  greatest,  would  be  likely  to  disclose  themselves  within 
a  few  hours  after  the  close  of  work,  and  therefore  would  seem  to  exist  in  a  less 
degree   on    Sunday    night.     If  there    was  ground   to   except   Saturday    night, 
when  the  workmen,  charged  as  watchmen,  examined  the  premises  after  the  close 
of  business,  having  an  interest  in  the  safety  of  a  building  in  which  they  slept,  or 
if  there  was  ground  to  except  Sunday  night,  after  a  day  in  which  no  work  had 
been   done,  then  it  was  incorrect  to  charge  the  jury  that  it  was  the  duty  of  the 
assured  to  have  a  person  to  keep  a  good  watch  in  the  building  during  the  whole 
of  Saturday  and  Sunday  nights  ;  otherwise  they  could  not  recover.     But  suppose 
the  .sixteenth  question  and  answer,  by  their  proper  construction,  could  be  held  to 
be  a  representation  that  the  plaintiffs  had  been  accustomed  to  keep,  and  would  in 
future  keep,  a  watch  on   the  premises  every  night  during  the  week,  including 
Sunday  and  Saturday,  still  the  stipulation  that  this  was  a  just-and  true  exposition 
is  not  absolute,  but  only  sub  ynodo  ;  the  contract  is,  that  is,  so  far  as  they  are 
known  to  the  assured,  and  are  material  to  the  risk.     The  question  therefore  is,  not 
only  whether  the  assured  was  substantially  to  comjily  with  his  stipulation  that 
the  representation  is  true  and  just,  but  whether  such  compliance  was  material  to 
the  risk.     This  is  a  question  of  fact,  to  be  decided  by  the  evidence.     The  insurer 
may  prescribe  any  conditions  to  his  undertaking  that  he  pleases,  and  if  he  makes 
insurance  on  condition  that  a  constant  watch  shall  be  kept  on  tlie  premises,  other- 
wise the  policy  shall  cease  and  be  void,  then  if  the  assured  fails  to  comply  with 
the  conditions,  his  policy  is  to  cease,  and  no  question  can  be  made  whether  com- 
pliance affected  the  risk  in  any  way.     But  when  such  condition  is  qualified  by  the 
limitation  that  it  is  a  failure  dependent  on  the  question  whether  it  is  material  to 
the  risk,  it  opens  that  question  in  each  particular  case." 

514 


CH.  XI.]       SPECIAL    PROVISIONS   OF   THE    CONTRACT,    ETC.         [§  252 

a  watchman  nights  have  been  before  the  courts.  In  Con- 
necticut it  has  been  held  that  an  answer  to  the  question, 
"  Is  there  a  watchman  in  the  mill  during  the  night?  "  that 
"There  is  a  w-atchman  nights,"  carries  with  it  an  obligation 
to  keep  a  watchman  in  the  mill  every  night  in  the  week. 
So  that  if  it  is  left  without  a  watchman  on  Sunday  morning, 
it  is  a  breach  of  the  contract  which  avoids  the  policy. ^  And 
substantially  the  same  doctrine  has  been  laid  down  in  New 
York,  where  it  has  been  held  that  a  statement  in  answer  to 
a  specific  question,  that  there  is  a  watchman  nights,  though 
followed  by  a  statement  that  the  mill  is  left  alone  after  the 
watchman  goes  off  duty  in  the  morning,  at  meal  times,  and 
on  the  Sabbath,  and  other  days  when  the  mill  does  not  run, 
requires  that  there  should  be  a  watchman  on  the  premises  as 
late  after  shutting  down  on  Saturday  night  as  three  or  four 
o'clock  the  next  morning,  and  that  loss  by  fire  occurring  at 
that  hour  in  the  morning,  in  the  absence  of  a  watchman,  is 
not  covered  by  the  policy. ^  Whether  a  warranty  that  a 
watchman  is  to  be  on  duty  at  all  times  is  violated  by  the 
watchman  going  to  his  meals,  there  being  no  exception  of 
such  absence,  has  been  held  to  be  a  question  for  the  jury.^ 
But  where  the  mill  was  said  to  be  constantly  worked,  and 
in  answer  to  a  question  whether  a  watch  was  kept,  it  was 
said  that  there  was  "  none,  except  people  working  in  the 
mill  during  the  night,"  it  was  held  that  this  did  not  amount 
to  a  stipulation  that  the  mill  should  be  run  every  night,  or 
on  the  Sabbath.* 

§  252.  Limitation  of  Risk  I  Watchman;  Excuse  for  Absence. 
—  In  First  National  Bank  of  Ballston  v.  Insurance  Company 
of  North  America,  it  appeared  that  the  following  interroga- 
tory was  propounded  to  the  insured  :  "  Watchman,  —  Is  one 
kept  in  the  mill  or  on  the  premises  during  the  night,  and  at 
all  times  when  the  mill  is  not  in  operation,  or  when  the 

1  Sheldon  v.  Hartford  Fire  Ins.  Co.,  22  Conn.  235  ;  Glendale  Maniif.  Co.  v 
Prot.  Ins.  Co.,  21  id.  19.  See  also  ante,  §  188.  But  see  Kipley  v.  Astor  Ins.  Co., 
17Ho\v.  Pr.  (N.  Y.)444. 

2  Ripley  V.  iEtna  Ins.  Co.,  30  N.  Y.  136,  reversing  s.  c.  29  Barb.  (N.  Y.)  550. 
8  Gibson  r.  Farmers',  &c.  Ins.  Co.,  1  Cin.  Slip.  Ct.  410. 

*  Prieger  v.  Exchange  Ins.  Co.,  6  Wis.  89. 

515 


§  252]         INSURANCE ;  fire,  life,  accident,  etc.        [ch.  XL 

workmen  are  not  present?"  Answer:  "Yes."  And  this 
was  held  to  be  a  warranty ;  and  that  the  fact  that  the  day 
before  the  fire  the  sheriff  levied  execution  on  the  personal 
property  in  the  mill,  excluding  and  locking  the  doors 
against  the  employees,  was  no  excuse  for  a  breach;  nor 
could  the  deputy  sheriff  in  custody,  or  a  trustee  of  the 
insured,  both  of  whom  were  together  in  the  office  of  the 
mill,  some  two  rods  from  it,  but  who  did  not  in  fact  keep 
watch,  be  considered  a  watch  within  the  meaning  of  the 
policy.  1  [Having  a  man  sleep  on  the  premises  is  not  a  com- 
pliance with  a  warranty  to  keep  a  watchman. ^  A  man  who 
works  in  the  mill  by  day  and  sleeps  at  night  too  far  away 
from  the  mill  to  see  it,  does  not  fulfil  the  conditions  of  a 
policy  requiring  a  watchman  to  guard  the  premises  when 
idle.^  A  warranty  to  keep  a  watchman  on  the  premises 
insured  is  fulfilled  if,  at  the  time  of  the  loss,  a  watchman 
is  on  the  premises  connected  with  the  mill,  and  in  a  better 
position  to  watch  the  mill  than  if  he  were  in  it.^(a)] 

1  50  K  Y.  45. 

2  [Brooks  V.  Standard  Fire  Ins.  Co.,  11  Mo.  App.  349.] 

3  [Wenzel  v.  Com.  Ins.  Co.,  67  Cal.  438.] 

*  [Sierra  Milling,  &c.  Co.  v.  Hartford  Fire  Ins.  Co.,  76  Cal.  235.] 

(a)  This    case    was  decided    under  and  watchmen  are  employed  against  all 

§  2629  of  the  Cal.    Civil  Code,  which  dangers,  and   not  merely  against  fire, 

provides  that  "  an  insurer  is  not  liable  the  word  is  to  receive  a  reasonable  con- 

for  a  loss  caused  by  the  wilful  act  of  the  struction,    and    the    court    cannot    in 

insured  ;  but  he  is  not  exonerated  by  every  case  pass  upon  the  word  or  his 

the  negligence  of  the  insured,  or  of  his  care,    as    matter  of  law,    without  add- 

agents  or  others."    A  late  decision  holds  ing  to  the  contract.     Power  r.  City  F. 

that  this  statute,  and  a  clause  in  the  Ins.  Co.,  8  Phila.  566  ;  Parrish  v.  Vir- 

policy   providing    that   "  one   or  more  ginia   F.  &  M.  Ins.  Co.   (N.  C),  20  Ins. 

watchmen  shall  be  on  duty  constantly,  L.  J.  95  ;    Plyer  v.   German-Am.   Ins. 

day   and    night,    in   and    immediately  Co.,  121  N.  Y.  689  ;  31  N.  Y.  St.  Eep. 

about  the  said  buildings  or  works,"  are  836.      A   foreman   who   with   his   men 

not   complied   with    by   having   a   day  kept  watch  of  a  vacant  mill,  which  was 

employe  sleep  in  a  house  three  hundred  close  to  the  adjacent  yard  where  they 

and  fifty  yards  from  the  insured  saw-mill  worked,  was  held  to  be  a  "  watchman," 

and  visit  it  twice  at  night,  it  not  being  though   he  could,   when    at   work,   see 

fully  visible  from  the  house.     McKenzie  only  one  side  of  the  mill,  and  not  into 

V.  Scottish  Union  &  N.   Ins.  Co.,  112  it.     Spies   v.    Greenwich    Ins.    Co.,   97 

Cal.  548,  559  ;  Rankin  v.  Amazon  Ins.  Mich.  310  (Grant,  J.,  dissenting)  ;  Au 

Co.,   89   Cal.    203.     But   as   the  word  Sable  Lumber  Co.  v.  Detroit  M.  M.  F. 

"watchman"  is  indefinite  in  meaning,  Ins.  Co.,  89  id.  407. 

516 


GH.  XL]      SPECIAL   PROVISIONS   OF   THE   CONTRACT,   ETC.         [§  253 

§  253.  Limitation  of  Risk ;  Working  of  Mills.  —  An  answer 
to  the  question,  "During  what  hours  is  the  factory  worked? '" 
stating  that  it  is  "usually"  worked  certain  hours  in  the 
summer,  and  certain  other  hours  in  the  winter,  and  adding, 
"Short  time  now,"  is,  it  seems,  no  warranty  that  the  mill 
shall  not  run  at  other  hours.  ^  [If  the  policy  and  applica- 
tion are  silent  as  to  the  number  of  hours  the  mill  is  to  run, 
the  policy  will  not  be  affected  by  running  it  over  hours. 2] 
"Constantly  worked"  means  worked  during  the  usual  and 
customary  working  hours  and  days  in  the  particular  busi- 
ness with  reference  to  which  the  language  is  used.^  In 
Mayall  v.  Mitford,*  it  was  said  that  where  certain  mills 
were  warranted  to  be  worked  by  steam,  and  by  day  only,  it 
was  not  enough  to  invalidate  the  policy  to  show  that  the 
engine  was  kept  running  by  night,  but  it  must  also  appear 
that  the  mills  were  kept  going.  The  words  "  worked  by  day 
only  "  refer  to  the  mills,  not  the  engine,  and  it  is  no  breach 
of  the  warranty  that  the  engine  is  kept  going  all  the  t\me.^(a) 

1  North  Berwick  Co.  v.  N.  E.  Fire  &  Mar.  Ins.  Co.,  52  Me.  336. 

2  [German-American  Insurance  Co,  v.  Steiger,  109  Illinois,  254.  See  last 
case  in  §  251.] 

8  PriegeriJ.  Exchange  Mut.  Ins.  Co.,  6  Wis.  89. 

*  6  Adol.  &  Ell.  670. 

6  [Whitehead  v.  Price,  2  Cr.  M.  &  R.  447,  454.  The  words  "worked  by 
day  only,"  in  a  policy,  mean,  working  in  its  popular  sense,  not  a  mere  turning  of 
shafts  without  any  practical  results.     Whitehead  v.  Price,  5  Tyrw.  825,  832.] 

(«)  The  insurer  has  the  right  to  stipu-  7  Lea  (Tenn.),   704.     So  if  the  policy 

late  against  tlie  cessation  of  the  running  expressly  provides  that  the   mill  shall 

of  a  mill  without  its  consent,  and  for  not  be  run  after  10  P.M.,  and  it  is   run 

the    care    and    supervision    of    skilled  later,    there   is  a  forfeiture,    especially 

workmen  necessarily  employed  in  run-  when  a  larger  premium  is  charged  for 

ning  it  during  the  customary  working  running  it  at  night.     Alspaugh  v,  P.rit- 

season  ;  in  such  case,  if  watchmen  are  ish-American  Ins    Co.,  121  N.  C.  290. 

substituted  for  workmen,  the  policy  is  A  condition   avoiding  a  policy  upon  a 

voidable  at  the  insurer's  option.      See  manufactory  if  it  ceases  to  be  operated 

Dover  Glass-Works  Co.  v.  American  F.  for  more  than  ten  consecutive  days,  does 

Ins.  Co.,    1  Marvel     (Del.),   32;    City  not  apply  to  a  temporary  stoppage  of 

Planing   &   Shingle   Mill   Co.   v.    Mer-  machinery  from  such  causes  as  sickness, 

chants*    Mut.    F.    Ins.    Co.,    72    Mich,  breakage,  or  low  water,  or  the  freezing 

654  ;  Stone  r.   Howard   Ins.    Co.,    153  of  the  mill-race.     Ladd  v.  JEtna.  Ins. 

Mass.  475;  Cronin  v.  Phila.  Fire  Ass'n  Co.,  147  N.  Y.   478;   Bellevue  Roller- 

(Mich.),    82   N.   W.    45  ;  American   F.  Mill    Co.   v.   London  &  L.  F.  Ins.  Co. 

Ins.  Co.  V.  Brighton  Cotton  Manuf.  Co.,  (Idaho),  39  Pac.  196. 
125  in.  131  ;  Poss  v  Western  Ass.  Co., 

517 


§  253  B]      INSURANCE :   fiee,  life,  accident,  etc.         [CH.  XI. 

[S  253  A.  Mills  ;  Provisions  against  Stoppage.  —  The  Condi- 
tion against  coasing  to  operate  a  factory  is  not  broken  by  a 
temporary  suspension  caused  by  an  epidemic,  ^  or  for  repairs 
which  were  permitted  by  the  policy ;  nor  by  a  temporary 
suspension  of  parts  of  tlie  business,  the  rest  continuing;  nor 
by  such  a  stoppage  of  all  work  as  may  result  from  want  of 
materials.^  But  when  the  policy  declares  its  suspension  by 
stoppage  of  the  mill  insured  for  more  than  twenty  days  from 
any  cause  whatever,  without  notice  to  the  company,  a  stop- 
ping for  necessary  repairs  is  within  the  provisiou.'^] 

[§  253  B.  Mills ;  Agent's  B^o-wledge  before  Issue  of  the 
Policy.  —  If  at  the  time  of  the  fire  a  factory  is  operated  in 
the  same  manner  as  it  is  known  to  be  at  the  time  of  insur- 
ance, the  policy  will  not  be  void  under  the  clause  against 
ceasing  operations,  although  the  operation  at  both  times 
named  was  only  a  very  slight  one.*  Knowledge  of  the  agent 
at  the  time  of  issuing  the  policy,  no  matter  how  obtained, 
is  knowledge  of  the  company.  If  the  agent  knows  that  a 
factory  insured  is  to  run  at  night  and  be  lighted  by  kero- 
sene, the  policy  will  not  be  void  by  keeping  kerosene  for 
that  purpose,  contrary  to  its  provisions.^  The  knowledge 
of  the  general  agent  who  countersigned  and  delivered  the 
policy  on  a  distillery,  that  it  had  always  been  run  at  night, 
is  a  waiver  of  the  condition  against  night  running.^  But 
notice  at  the  time  of  issuing  the  policy  of  an  intention  to  do 
an  act  in  the  future  does  not  ripen  into  knowledge  of  the 
existing  fact,  even  when  the  specified  period  h^s  passed,  nor 
will  verbal  consent  of  the  company  before  issue  of  the  policy, 
that  such  an  act  may  be  done  in  the  future,  estop  it."  And 
in  Massachusetts,  in  harmony  with  the  decisions  of  that 
State,  spoken  of  in  §  145  et  seq.,  it  is  held  that  if  a  factory 

1  [Poss  V.  "Western  Assurance  Co.,  7  Lea  (Tenn.),  704,  707.] 

2  [American  Fire  Ins.  Co.  v.  Brighton  Cotton  Manuf.  Co.,  125  111.  131.] 
8  [Day  V.  Mill  Owners'  Mnt.  Fire  Ins.  Co.,  70  Iowa,  710.] 

*  [Lebanon  Mut.  In.s.  Co.  v.  Erh.  112  Pa.  St.  149.] 

^  [Coucli  V.  Piochester  German  Fire  Ins.  Co.,  25  Hun,  469  ;  "Woodward  v.  Re- 
public Fire  Ins.  Co.,  32  Hun,  365.] 

«  [American  Cent.  Ins.  Co.  v.  McCrea,  Maury,  &  Co.,  8  Lea  (Tenn.),  513.] 
7  [McNiemey  v  Agricultural  Ins.  Co.,  48  Hun,  239.] 

518 


CH.  XI.]      SrECIAL   PROVISIONS    OF   THE    CONTRACT,   ETC.        [§  254 

is  run  at  night  in  violation  of  a  provision  in  the  policy  the 
latter  is  avoided,  and  oral  evidence  that  similar  establish- 
ments were  usually  so  run  and  could  not  be  successfully 
carried  on  otherwise,  and  that  the  company's  agent  knew 
these  facts  when  he  fixed  the  premium,  is  not  admissible,  i] 
'  §  254.  Limitation  of  Risk ;  Examination  after  "Work.  —  In 
Houghton  V.  Manufacturers'  Mutual  Fire  Insurance  Com- 
pany, nhe  court  elaborately  discussed  the  meaning  and  effect 
of  a  statement  that  the  premises  insured  were  examined 
after  work,  both  as  to  what  constitutes  an  examination  and 
when  it  should  take  place,  that  is,  what  point  of  time  is 
designated  by  the  words  "  after  work."  Such  statement  was 
held  to  be  an  executory  representation,  amounting  to  a 
stipulation  that  the  examination  should  continue  during  the 
term  of  the  insurance.  ^ 

1  [Reardon  v.  Faiieuil  Hall  Ins.  Co.,  135  Mass.  121.] 

2  8  Met.  (Mass.)  114. 

3  The  opinion  of  Shaw,  C.  J.,  upon  this  point  was  as  follows  :  "One  other 
point  was  taken,  respecting  which  an  opinion  was  asked  for  and  given  at  the  trial. 
It  related  to  the  representation  and  the  practice  in  respect  to  the  examination  of 
the  factory.  The  re[ireseutation  was  contained  in  the  answer  to  the  fourteenth 
question,  as  follows:  '  Is  a  watch  kept  constantly  in  the  buihling  ?  If  no  watch 
is  constantly  kept,  state  what  is  the  arrangement  respecting  it.'  Answer  :  'No 
watch  is  kept  in  or  about  the  building ;  but  the  mill  is  examined  thirty  minutes 
after  work.'  This  question  referred  to  the  requirements  of  the  office  on  the  last  of 
the  representations,  amongst  which  is  this,  viz.,  that  an  examination  will  be  had, 
say  thirty  minutes  after  work.  Question  21  was  this :  '  During  what  hours  is  the 
factory  worked  ? '  The  answer  was  :  '  From  5  o'clock  A.  M.  to  8j  o'clock  P.  M. 
Sometimes  extra  work  will  be  done  in  the  night.'  Two  questions  were  made  at 
the  trial.  First,  whether  the  representation  of  the  usual  practice  amounted  to  a 
condition  or  stipulation  that  it  should  be  continued.  It  was  ruled  at  the  trial, 
and  the  whole  court  are  now  of  opinion,  that  as  this  examination  was  manifestly 
intended  as  a  substitute  for  a  constant  watch  ;  as  it  was  one  which  the  assured 
had  it  in  their  own  power  to  make  or  cause  to  be  made  ;  as  it  was  one  of  the  pre- 
cautions tending  to  secure  the  property  against  danger  of  fire  and  tending  to  its 
safctv,  —  it  was  one  which,  as  a  general  practice,  the  assured  were  bound  to  fol- 
low, although  an  occasional  omission,  owing  to  accident,  or  to  the  negligence  of 
subordinate  persons,  servants,  or  workmen,  not  sanctioned  nor  permitted  by  the 
assured,  or  by  their  superintendent,  manager,  or  agent,  might  not  be  a  breach  or 
non-compliance.  The  second  question  under  this  clause  regarded  the  time  at 
which  the  examination  was  to  be  made.  The  question,  as  understood  at  the  trial, 
was  this  :  Whether,  if  the  factory  work  was  continued  during  extra  hoars  in  the 
niglit,  that  is,  after  half-past  eight  p.  M.,  the  examination  should  be  made  at  half 
an  hour  after  the  cessation  of  actual  work,  or  half  an  hour  after  the  time  fixed  in 
the  twenty-first  answer,  as  the  usual  hour  of  the  cessation  of  work  ?     On  this 

519 


§  255]  INSUKANCE  :    FIKE,   LIFE,   ACCIDENT,   ETC.  [cil.  XI. 

§  255.    Limitation  of  Risk  ;  "Wanning ;  Care  of  Stoves  ;  Ashes  ; 
Shutters.  —  111  Aurora  Fire  Insurance  Company  v.  Eddy,ione 

question,  considering  the  purpose  of  the  examination,  and  considering  that  the 
object  of  the  examiner  would  be,  by  the  sense  of  sight  or  smell  to  detect  any 
latent  fire,  or  fire  beginning  to  kindle,  arising  from  sparks  from  the  extinguished 
lamps,  spontaneous  combustion,  friction  of  machinery,  or  otherwise  ;  as  this  could 
be  best  accomplished  after  the  mills  we)'e  stopped,  and  the  operations  of  the  fac- 
tory for  the  night  had  ceased,  and  the  persons  employed  in  it  had  left,  I  was  of 
opinion  that  the  examination  must  be  made  at  thirty  minutes  after  the  cessation 
of  the  actual  work  of  the  factory,  and  that  an  examination  at  tliirty  minutes  after 
the  time  fixed  by  the  twenty-first  answer,  as  the  usual  time  for  closing  work,  if 
the  factory  did  continue  in  opeiation,  was  not  a  substantial  compliance  with  this 
stipulation.  And  the  court  aie  of  opinion  that  this  direction,  in  the  case  sup- 
posed, was  right,  and  that  such  is  the  correct  construction  of  the  contract.  The 
answer  had  represented  that  the  usual  hour  of  the  cessation  of  work  was  half-past 
eight,  yet,  having  represented  that  the  factory  would  sometimes  be  worked  during 
extra  hours  in  the  night,  they  had  a  right  so  to  work  without  impairing  the  con- 
tract. But  if  they  thought  tit,  for  any  cause,  to  change  the  hour  of  work,  so  that 
it  should  continue  to  a  later  hour  of  the  night,  they  must  see  that  the  examina- 
tion be  made  at  tliirty  minutes  after  the  actual  cessation  of  work.  But  another 
question  is  now  presented,  which  was  not  distinctly  raised  at  the  trial,  and  in 
regard  to  which  the  evidence  was  not  fully  reported  ;  and  it  is  this :  What  is  the 
cessation  or  termination  of  work  ?  or,  in  other  words.  What  is  the  meaning  of 
thirty  minutes  after  work,  within  tlie  meaning  of  the  answer  to  the  fourteenth 
question  ?  As  there  is  to  be  a  new  trial  on  other  grounds,  we  think  it  proper  to 
state  the  opinion  of  the  court  upou  this  point ;  although,  through  misapprehen- 
sion of  the  counsel,  or  of  the  court,  or  otherwise,  it  was  not  raised  at  the  trial, 
or  presented  on  the  report.  Tlie  question  as  to  what  is  a  termination  of  work, 
within  the  meaning  of  this  contract,  is  partly  a  question  of  law  and  partly  a 
question  of  fact.  The  intentions  of  the  parties,  if  they  can  be  ascertained,  are  to 
govern  ;  and  these  are  to  be  learned  from  tlie  language  used  construed  in  connec- 
tion with  every  part  and  clause  in  tlie  contract,  the  suliject- matter  respecting 
which  they  are  used,  and  the  obvious  puii)oses  of  each  stipulation.  That  the  as- 
sured were  bound  to  make  an  examination  at  thirty  minutes  after  work  is  the 
construction  of  law  on  the  contract.  Wliat  is  the  cessation  of  woj-k  is  a  question 
of  fact  for  the  jury,  depending  upon  the  circumstances,  and  having  in  view  the 
object  and  purpose  of  the  stipulation,  which  was  to  have  an  examination  at  such 
time  as  will  conduce  to  the  safety  of  the  building.  As  some  of  the  sources  of 
danger  are  the  continuance  of  fires  and  lights,  and  the  friction  of  machinery,  so 
long  as  the  general  work  of  the  factory  and  operation  of  the  machinery  continue, 
a  jury  must  find  that  the  work  had  not  then  ceased,  and  could  not  be  warranted 
in  finding  otherwise.  If,  on  the  contrary,  the  gates  were  shut,  the  machinery  all 
stopped,  the  fires  and  lights  extinguished,  and  the  operatives  generally  retired,  it 
could  hardly  be  said  that  the  work  had  not  ceased,  although  one  or  two  persons 
should  remain  to  do  something  which  shouM  create  no  danger  of  fire.  The  fact 
to  be  looked  to  is  not  that  the  persons  employed  have  all  left,  or  that  the  lights 
are  all  extinguished,  or  that  the  machinery  has  wholly  stopped,  but  the  termina- 
tion of  the  time  during  which  the  factory  is  worked  ;  and  this  is  an  inference  of 


1  55  111.  213.     See  also  Schmidt  v.  Peoria  Mar.  &  Fire  Ins.  Co.,  41  111.  295. 

520 


CH.  XI.]      SPECIAL   PROVISIONS   OF   THE    CONTRACT,   ETC.         [§  255 

of  the  questions  in  the  application  was,  "How  warmed, — 
are  any  stoves  used?  "  to  which  the  answer  was,  "No  stoves 
used ;  "  and  it  was  held  that  this  was  a  representation  that 
stoves  were  not  used  at  the  time  when  the  representation 
was  made,  and  not  a  warranty  that  they  should  not  be  used 
at  all.  And  a  warranty  that  stoves  and  pipes  are  well 
secured,  and  shall  be  kept  so,  is  not  to  be  so  strictly  con- 
strued as  to  be  considered  violated  by  an  accidental  occur- 
rence, as  by  the  fact  that  the  wife  of  the  insured,  a  few  days 
after  the  pipe  had  been  partly  removed  in  preparation  for 
removing  both  stove  and  pipe  during  summer,  as  was  usual, 
in  a  moment  of  forgetfulness  carelessly  kindled  a  fire  in  the 
stove. ^  And  an  answer,  "None,"  to  the  question  whether 
stoves  were  properly  secured,  referred  to  stoves  for  heating 
purposes,  and  not  to  a  stove  used  on  board  a  steamboat  for 
refitting  purposes.  ^  And  a  warranty  that  ashes  are  kept  in 
brick  is  complied  with  if  they  are  kept  in  some  other  equally 
safe  way.^  [When  the  insured  stated  that  the  ashes  on  the 
premises  were  put  into  brick  vaults  and  the  policy  stated 
that  the  company  would  not  be  liable  if  they  were  left  on 
wood,  the  policy  was  held  avoided  by  putting  the  ashes  in 
a  wooden  barrel  in  the  woodhouse  continuously  for  several 

fact,  which  may  be  influenced  more  or  less  by  all  these  considerations.  Now  be- 
tween the  full  operation  of  the  factory  and  the  entire  cessation  of  work,  extremes 
may  be  supposed  on  either  hand,  respecting  which  there  could  be  no  doubt. 
There  may  be  various  intermediate  stages  in  which  it  would  be  the  duty  of  the 
jury  to  determine,  upon  the  particular  combination  of  circumstances,  whether 
they  constituted  a  cessation  of  working  of  the  factory  or  not.  If  the  general  work 
of  the  factory  has  ceased,  although  a  single  machine  may  remain  in  operation  for 
a  special  purpose,  we  think  a  jury  should  be  instructed,  that  if  such  machine 
should  cause  no  danger  of  fire,  the  examination  should  be  made  at  thirty  minutes 
after  the  cessation  of  the  general  work,  and  not  after  the  stopping  of  the  particu- 
lar machine,  and  this  the  rather  because  the  contract  stipulates  but  for  one  ex- 
amination after  the  cessation  of  the  general  work,  which,  being  apparently  most 
for  the  interest  of  both  parties,  may  be  presumed  to  be  most  conformable  to  their 
intentions.  .  And  so  in  the  various  cases  it  vvill  be  for  the  jury  to  say,  under  the 
direction  of  the  court,  taking  into  view  the  pur[)ose  of  the  examination,  and  the 
nature  of  the  work  done,  and  the  risk  attending  it,  whether,  within  the  meaning 
of  this  contract,  the  work  of  the  factory,  in  the  particular  case,  had  terminated." 

1  Mickey  v.  Burlington  Ins.  Co.,  35  Iowa,  174.     And  see  aiite,  §  241. 

2  Lyon  V.  Stadacona  Ins.  Co.,  44  U.  C.  (Q.  B.)  472,  474.     See  also  Madsden 
V.  Phnenix  Ins.  Co.,  1  S.  C.  N.  s.  24. 

■^  Underbill  v.  Agawam  Mut.  Ins.  Co.,  6  Cush.  (Mass.)  440. 

521 


§  256]  INSURANCE :    FIKE,   LIFE,   ACCIDENT,    ETC.  [CH.  XI. 

weeks  up  to  the  time  of  the  fire,  though  done  by  a  boy  with- 
out orders,  it  appearing  that  there  were  no  brick  vaults  as 
stated.^]  A  statement  in  the  description  of  the  building 
insured  that  it  has  "iron  doors  and  shutters,"  is  no  war- 
ranty tliat  they  shall  be  kept  closed  at  any  particular  time.^ 

§  256.  Description ;  Representation.  —  Matter  of  descrip- 
tion, unless  by  the  terms  of  the  policy  made  to  have  greater 
force,  stands  upon  the  footing  of  representations,  and  if  facts 
material  to  the  risk  are  omitted  it  is  a  concealment.*^  (a) 
And  mere  matter  of  immaterial  description,  so  immaterial 
as  not  presumably  to  have  been  regarded  by  either  party  as 
of  importance,  contained  in  the  application,  will  not  by 
reference  be  converted  into  a  warranty.  This  was  the  doc- 
trine declared  in  a  case  where  a  detailed  description  was 
given  as  to  the  occupancy  of  the  several  rooms  of  a  building 
on  which  insurance  was  obtained,  which  was  not  in  all 
respects  true,  even  at  the  time  when  the  insurance  was 
effected.*  And  to  the  same  effect  is  Frisbie  v.  Fayette 
Mutual  Insurance  Company,^  where,  amongst  other  state- 
ments in  the  application,  which  was  made  part  of  the  policy, 
it  was  said  that  a  clerk  slept  in  the  store.  But  this  was 
held  to  be  mere  description  of  the  mode  of  occupancy  at  the 

1  [Worcester  v.  Worcester  Mut.  Fire  Ins.  Co. ,  9  Gray,  27,  29.] 

2  Scott  V.  Quebec  Ins.  Co.,  1  Stuart  (Lower  Canada),  147. 

3  Casey  v.  Goldsmid,  4  L.  C.  (Q.  B.),  107,  reversing  s.  c.  2  id.  200  ;  Perry  Ins. 
Co.  V.  Stewart  19  Pa.  St.  4.5  ;  Baxendale  v.  Harvey,  4  H.  &  N.  (Exch.)  445.  A 
statement  that  a  threshing  machine  is  "  stored  in  the  barn  "  is  mere  matter  of  de- 
scrijition.  Material  misdescription  is  such  as  is  not  substantially  correct,  and 
such  as  leads  to  a  lower  rate  of  premium  than  if  the  description  had  been  correct. 
In  re  Universal,  &c.  Ins.  Co.,  L.  R.  19  Eq.  485  ;  s.  c.  5  Benn.  Fire  Ins.  Cas. 
688  ;  Everett  ;;.  Continental  Ins.  Co.,  21  Minn.  76. 

*  Boardman  v.  N.  H.  Mut.  Fire  Ins.  Co.,  20  N.  H.  551. 
5  27  Pa.  St.  325. 

(a)  When  there  is  no  written  appli-  that  a  certain  contract  was  secured  by  a 

cation  and  the  insured  had  correctly  de-  conditional  mortgage  on  the  property, 

scribed   the   property   to   the  agent,  a  which    was  incorrect  as  describing  the 

mi.sdescription  in   the  policy   will  not  fact    that  the  title  itself  was  pledged, 

defeat  the  contract,  though  the  descrip-  and  the  insurer  knew  the  material  facts, 

tion  was  made  part  of  the  contract  and  the  policy  was  held  not  to  be  defeated 

a   warranty.       Dowling  v.    Merchants'  by  the  erroneous  description.     Davis  v. 

Ins.  Co.,  168  Penn.  St.  234  ;  supra,  §  181,  Pioneer  Furniture  Co.,  102  Wis.  394. 
n.  (a).      Where  the  application  stated 

522 


CH.  XI.]      SPECIAL    PROVISIONS    OF   THE    CONTRACT,    ETC.         [§  257 

time,  and  not  a  warranty  that  the  clerk  should  sleep  there 
every  night. 

A  call  for  a  true  description  of  the  house,  building,  or 
place  where  the  insured  goods  are  kept,  refers  to  the  char- 
acteristics of  the  house,  not  the  interest  of  the  insured  in  it. 
And  therefore  a  lodger  in  a  room  furnished  by  himself  may 
well  say  that  the  property  insured  —  his  furniture  —  is  in 
his  dwelling-house.^  And  when  the  particular  interest  is 
the  subject-matter  of  the  insurance,  a  misdescription  of  the 
ownership  or  of  the  property  to  which  the  interest  attaches, 
in  the  absence  of  express  stipulation  to  that  effect,  will  not 
avoid  the  policy.^  The  description  of  a  dwelling-house  in 
the  application  will  not  be  held  to  be  a  warranty,  unless  the 
policy  shows  it  was  so  intended.^ 

§  257.  Description  ;  Warranty  ;  Place.  —  It  has  been  held 
in  some  cases,  however,  that  mere  matter  of  description  may 
amount  to  a  warranty.  Thus  it  is  said  in  Fowler  v.  ^Etna 
Fire  Insurance  Company^  that  mere  description  of  the  sub- 
ject-matter of  insurance,  as,  for  instance,  that  a  house  is 
"filled  in  with  brick,"  is  a  warranty,  after  the  analogy  of 
marine  insurance,  as  the  estimate  of  the  risk  must  generally 
depend  upon  the  description.  But  the  case  cited  in  support 
of  the  opinion  does  not  support  it.^  The  question  in  that 
case  was  one  of  the  materiality  of  an  alteration  of  the  build- 
ing insured.  And  the  same  was  said  in  Sillem  v.  Thorn- 
ton,^ where  the  house  was  described  as  a  two-story  house, 
when  in  fact  it  was  at  the  time  of  insurance  being  converted 
into  a  three-story  house,  —  a  change  which  was  commenced 
some   months  after  the  application  was   made.'^     And   this 

1  Friedlaiider  v.  London  Ass.  Co.,  1  M.  &  Rob.  171. 

2  Fox  V.  Phoenix  Fire  Ins.  Co.,  52  Me.  333  ;  Longhurst  v.  Conway  Fire  Ins. 
Co.,  U.  S.  Dist.  Ct.  Iowa,  1861  ;  Dig.  Ins.  Cas.  3d  ed..  h\'  Bates. 

3  Farmers'  Ins.  &  Loan  Co.  v.  Snyder,  16  Wend.  (N.  Y. )  481,  affirming  s.  c. 
13  id.  92.      But  see  ante,  §  247,  note. 

«  6  Cowen  (N.  Y.),  673  ;  s.  c.  7  Wend.  (N.  Y.)  270. 

5  Stetson  V.  Mass.  Mut.  Fire  Ins.  Co.,  4  Mass.  330,  337.     And  see  post,  §  262. 

6  3  E.  &  B.  868. 

i'  See  also,  to  the  same  effect,  Wood  v.  Hartford  Fire  Ins.  Co.,  13  Conn.  533, 
where,  however,  the  point  decided  was  that  there  had  been  no  change  from  a 
permitted  to  a  prohibited  use. 

523 


§  257]  INSURANCE :   FIRE,   LIFE,  ACCIDENT,  ETC.  [CH.  XL 

case  states  the  doctrine  with  the  limitation  that  only  such 
descriptive  matter  as  relates  to  the  risk  amounts  to  a  war- 
ranty. Probahly  that  is  all  that  was  intended  in  either 
case,  as  that  was  all  that  was  required  by  the  facts.  In 
Sillem  V.  Thornton,^  the  policy  was  not  issued  till  some 
months  after  the  application  was  made,  and  there  had  been 
a  change  in  the  mean  time  in  the  status  of  the  property,  a 
two-story  house  having  been  converted  into  a  three-story 
house ;  and  the  description  of  the  house  was  held  to  be  a 
warranty.  2     So  it  has  been  held  that  if  the  property  is  de- 

1  Ubi  snpra. 

2  In  Stokes  v.  Cox,  1  H.  &  N.  (Exch. )  533,  the  court  seemed  to  regard  this 
case  as  one  not  to  be  followed  except  upon  identical  facts.  As  Sillem  v.  Thorn- 
ton goes  to  the  extreme  limits  of  strictness,  and  is  ably  stated,  we  give  here  liberal 
extracts  from  the  opinion  of  Lord  Canijibell,  C.  J. :  "  But  we  are  further  of 
opinion  that  the  description  in  the  policy  amounts  to  a  warranty  that  the  assured 
would  not,  during  the  time  specified  in  the  policy,  voluntarily  do  anything  to 
make  the  condition  of  the  building  vary  from  this  description,  so  as  thereby  to 
increase  the  risk  or  liability  of  the  underwriter.  In  this  case,  the  description  is 
evidently  the  basis  of  the  contract,  and  is  furnished  to  the  underwriter  to  enable 
him  to  determine  whether  he  will  agree  to  take  the  risk  at  all,  and  if  he  does  take 
it,  what  premium  shall  he  demand.  The  assured,  no  doubt,  wished  him  to  under- 
stand that  not  only  such  was  the  condition  of  the  premises  when  the  policy  was 
to  be  effected,  but,  as  far  as  depended  upon  them,  it  should  not  be  altered  so  as 
to  increase  the  risk  during  the  j'ear  for  which  he  was  to  be  liable  if  a  loss  should 
accrue.  Without  such  an  assurance  and  belief  the  statement  introduced  into  the 
policy  of  the  existing  condition  of  the  premises  would  be  a  mere  delusion.  Iden- 
tity might  continue,  and  yet  the  quality,  condition,  and  incidents  of  the  subject- 
matter  insured  might  be  so  changed  as  to  increase  tenfold  the  chances  of  loss, 
which,  upon  a  just  calculation,  might  reasonably  be  expected  to  fall  upon  the 
underwriter.  Can  it  be  successfully  contended  that,  having  done  so,  the  assured 
retain  a  right  to  the  indemnity  for  which  they  had  stipulated  upon  a  totally  dif- 
ferent basis  ?  With  respect  to  marine  policies,  we  conceive  that  if  there  be  a 
warranty  of  neutrality,  or  of  any  other  matter  which  continues  of  importance  till 
the  risk  determines,  whether  the  policy  be  for  a  voyage  or  for  a  certain  time,  such 
a  warranty  is  continuous  ;  and  if  it  be  broken  by  a  default  of  the  assured,  the 
underwriter  is  discharged.  The  implied  warranty  of  seaworthiness  ajiplies  only  to 
the  commencement  of  the  voyage  ;  but  even  here,  if  the  assured,  during  the  voy- 
age, were  voluntarily  to  do  any  act  whereby  the  ship  was  rendered  unseaworthy, 
and  thereby  a  loss  were  to  accrue,  we  conceive  that  they  would  have  no  remedy 
on  the  policy.  A  distinction,  however,  is  taken  in  this  respect  between  a  marine 
policy  and  insurances  of  houses  against  fire.  It  would  probably  be  allowed  that 
if  during  war  there  was  a  policy  on  a  merchant  ship  described  as  carrying  ten 
guns,  and  emjiloyed  in  the  coal-trade,  and  after  the  policy  was  eflected  the  owner 
should  reduce  the  armament  to  five  guns,  or  load  her  with  oil  of  vitriol,  the  under- 
writer would  not  be  liable  for  a  subsequent  loss.  But  it  is  strenuously  asserted 
that  if  there  be  an  insurance  against  fire  upon  a  house,  which  is  described  in  the 

524 


CH.  XI.]      SPECIAL    PEOVISIONS    OF   THE   CONTRACT,   ETC.        [§  257 


scribed  as  situated  at  a  particular  place,  or  in  a  particular 
building,  this  is  a  warranty  as  to  the  locality. ^  (a) 

policy  as  being  of  a  particular  specified  description,  and  in  which  it  is  stated  that 
the  occupier  carries  on  a  certain  specified  trade,  —  this  being  true  at  the  date  of 
the  policy,  the  assured,  preserving  the  identity  of  the  house,  may  alter  its  construc- 
tion, so  as  to  render  it  more  exposed  to  fire,  and  may  carry  on  in  it  a  different  and 
more  dangerous  trade,  without  prejudice  to  the  right  to  recover  for  a  subsequent 
loss  by  fire,  the  warranty  extending  only  to  the  state  and  use  of  tlie  premises  at 
the  moment  when  the  policy  was  signed.  This  seems  quite  contrary  to  the  principles 
on  which  contracts  are  regulated.  The  construction  and  use  of  the  premises  in- 
sured, as  described  in  the  policy,  constitute  the  basis  of  insurance,  and  determine 
the  amount  of  the  premium.  But  this  calculation  can  only  be  made  upon  the 
supposition  that  the  description  in  the  policy  shall  remain  substantially  true 
while  tlie  risk  is  running,  and  that  no  alteration  shall  subsequently  be  made  by 
the  assured  to  enhance  the  liability  of  the  insurer.     It  seems  strange,  then,  that 


1  Bryce  v.  Lorillard  Ins.  Co.,  .55  N.  Y.  240.  It  would  be  perhaps  more  cor- 
rect to  hold  tliat  a  policy  on  property  situated  in  one  place  never  attached  to 
property  situated  at  a  different  place,  than  to  hold  there  was  a  breach  of  warranty. 
See  post,  §  400  a. 


(a)  Where,  the  property  being  de- 
scribed in  the  complaint  as  "  lots  27 
and  28,  block  8,  in  Harlington  addition 
to  Mt.  Tabor,"  it  appeared  that  there 
was  no  such  place,  but  that  they  were 
as  numbered  in  Harlem  addition  to 
East  Portland,  the  variance  was  held 
not  fatal.  Baker  v.  State  Ins.  Co.,  31 
Oregon,  41.  So,  where  the  insured 
building  was  described  as  situated  on 
lot  2,  block  3,  and  there  was  evidence 
of  an  incumbrance  on  the  west  seventy- 
seven  feet  of  the  east  ninety  feet  of 
block  2,  and  all  buildings  thereon,  this 
was  held  not  evidence  of  the  incum- 
brance of  the  insured  building.  Green- 
lee V.  Iowa  State  Ins.  Co.,  102  Iowa, 
260. 

Where  a  dwelling-house  or  personal 
property  is  insured,  and  the  policy  by 
mistake  misdescribes  the  land  on  which 
it  is  situated,  this  will  not  of  itself 
affect  the  risk  or  render  the  policy  void, 
and  it  is  not  necessary  to  reform  the 
policy,  in  case  of  a  loss,  to  recover 
thereon.  Kansas  Farmers'  F.  Ins.  Co. 
V.  Saindon,  52  Kansas,  486  ;  Omaha  F. 
Ins.  Co.  V.  Dufek,  44  Neb.  241 ;  Martin 
V.  Farmers'  Ins.   Co.,    84   Iowa,    516. 


But  where  a  policy  of  insurance  insured 
buildings  situated  on  section  31,  it  was 
held,  that,  even  if  section  31  were  in- 
serted by  mistake,  the  parties,  intending 
the  insurance  to  be  on  buildings  upon 
section  32,  no  recovery  can  be  had  for  a 
loss  to  buildings  on  the  latter  section 
without  a  reformation  of  the  policy. 
Collins  V.  St.  Paul  F.  &  M.  Ins.  Co., 
44  Minn.  440. 

Where,  under  a  policy  insuring 
tobacco  and  cigars  "contained  in  brick 
block  situated  82-90  Worthington  St.," 
a  firm  occupied  the  fifth  story  over 
stores  numbered  84  to  90  and  also  the 
fifth  story  over  a  store  numbered  80, 
the  only  entrance  to  all  being  a  door- 
way numbered  82  ;  and  the  building 
had  been,  from  time  to  time,  extended 
and  remodeled  and  was  owned  by  one 
person,  and  a  doorway  and  a  hallway 
connected  80  with  82,  it  was  held  that 
the  policy  covered  the  contents  of  No, 
80  ;  and  that  where  a  policy  describes 
the  building  by  its  official  number,  the 
unauthorized  change  to  another  number 
by  the  owner  does  not  affect  the  policy. 
Westfield  Cigar  Co.  v.  Ins.  Co.  of  No. 
America,  165  Mass.  541. 

525 


§  258]  INSURANCE :    FIKE,    LIFE,   ACCIDENT,   ETC.  [CH.  XI. 

§  258.  Limitation  of  Risk  ;  Description  ;  Surroundings  ;  Dis- 
tance ;  Contiguity.  —  With  regard  to  the  situation  of  the 
property  insured,  its  surroundings,  its  relation  to  other 
buildings,  and  its  exposure  to  risk  from  external  sources,  if 
the  insured  warrant  that  he  has  made  a  full  and  true  state- 
ment, on  penalty  of  forfeiture,  he  must  take  the  consequences 
of  any  real  omission.  If  he  will  undertake  to  state  all  the 
buildings  exposed  within  a  given  distance,  the  penalty  of 
failure  will  be  the  loss  of  his  right  to  recover. ^  We  say  real 
omission,  because  if  the  omission  be  of  some  insignificant 
out-house,  it  will  be  of  no  importance. ^     It  is  a  question  of 

if  a  Louse  be  described  in  the  policy  as  occupied  by  the  owner,  carrying  on  the 
trade  of  a  butcher,  so  that  the  premium  is  on  the  lowest  scale,  he  may  immediately 
afterwards,  merely  taking  care  that  the  walls  and  floors  and  roof  remain,  so  that 
it  is  still  the  same  identical  house,  convert  it  into  a  manufactory  for  hreworks,  a 
trade  trebly  hazardous,  for  which  the  highest  scale  of  premium  would  be  no  more 
than  a  reasonable  consideration  for  the  stipulated  indemnity.  .  .  .  Now,  assum- 
ing the  law  to  be  that  upon  an  insurance  against  fire  there  is  an  implied  engage- 
ment that  the  assured  will  not  afterwards  alter  the  premises  so  that  they  shall  not 
agree  with  the  description  of  them  in  the  policy,  and  so  that  thereby  the  risk  and 
liability  of  the  insurer  shall  be  increased,  we  have  only  to  consider  whether,  in 
this  instance,  the  assured  have  not  done  so  by  converting  the  house  insured  from 
'  a  house  composed  of  two  stories  '  into  a  house  composed  of  three  stories  ;  and 
this  really  admits  of  no  reasonable  doubt.  Mr.  Bramwell  very  candidly  admitted 
that  if  the  policy  remained  in  force  after  the  alteration,  it  covered  the  third  story 
as  well  as  the  other  two.  This  being  so,  the  increase  of  the  area  of  the  building 
by  a  third  story  must  be  considered  by  the  court  to  have  necessarily  increased  the 
hazard  or  probability  of  fire  about  as  much  as  if  the  addition  to  the  house  had 
been  lateral  instead  of  vertical. 

"  But  there  is  another  consideration,  which  is  quite  decisive  to  show  that  by 
the  alteration  the  liability  of  the  insurer  is  increased,  and  that  his  premium,  if 
previously  fair,  has  now  become  inadequate.  Upon  an  insurance  of  a  house 
against  fire,  the  insurer  must  make  good  the  whole  of  any  partial  loss,  the  owner 
not  being  considered  to  stand  his  own  insurer  for  the  excess  of  the  value  of  the 
house  beyond  the  sum  for  which  the  insurance  is  effected.  The  value  of  the  ad- 
ditional property  here  sought  to  be  covered  by  the  insurance  must  be  taken  to  be 
£1,000,  and  for  the  whole  of  this,  or  any  part  of  it,  the  defendant  is  now  liable  to 
the  full  amount  of  the  sum  for  which  he  has  subscribed  the  policy  till  he  has  paid 
£1,600,  pZ«s  his  liability  to  this  amount  for  the  destruction  of  any  part  of  the 
original  house,  valued  at  £4,000.  We  are  of  opinion  that  this  additional  liability 
could  not  be  thrown  upon  him,  without  any  consideration  and  against  his  consent, 
by  the  act  of  the  assured  in  altering  the  house  so  as  to  make  it  no  longer  corre- 
syiond  with  the  description  of  the  house  in  the  policy.  If  the  liability  cannot  be 
carried  to  this  extent,  it  is  entirely  gone  ;  and,  therefore,  we  pronounce  judgment 
for  the  defendant." 

J  Cliafi'ee  v.  Cattaraugus  County  Mut.  Fire  Ins.  Co.,  18  N.  Y.  376. 

-  White  V.  Mut.  Fire  Ass.  Co.,  8  Gray  (Mass.),  567. 

526 


CH.  XI.]      SPECIAL    PROVISIONS    OF   THE    CONTRACT,   ETC.        [§  258 

the  substantial  truth  of  the  warranty.  The  more  guarded 
warranty,  qualified  by  the  limitation,  "so  far  as  is  known  to 
the  assured,"  will  throw  upon  the  insurers  the  burden  of 
proving  the  knowledge  of  the  insured,  without  which  proof 
their  responsibility  cannot  be  avoided.  ^  iSo  where  the  ques- 
tion calls  for  the  relative  situation  of  other  buildings  and 
the  distance  of  the  building  insured  from  each  other  build- 
ing within  a  given  distance,  it  must  be  answered  with 
substantial  accuracy. ^  And  the  same  is  true  whether  the 
answer  be  in  detail,  or  generally,  as  by  saying  "see  dia- 
gram," or  "see  plan,"  the  diagram  or  plan  being  annexed  to 
the  application,  which  is  made  part  of  the  policy  by  its 
terms. 3  If  the  diagram,  however,  be  not  annexed  to  the 
application,  although  referred  to  therein,  it  will  not  neces- 
sai-ily  be  regarded  as  a  warranty;  certainly  not  except  as  to 
such  matters  contained  therein  as  are  responsive  to  the  par- 
ticular interrogatories  in  the  application.*  And  it  may  be 
said  generally  with  regard  to  such  statements  as  are  im- 
ported into  the  contract  by  reference,  and  thus  made  war- 
ranties, that,  while  the  courts  will  not  readily  yield  to  the 
claim  that  a  merely  literal  and  technical  breach  will  avoid 
the  policy,  they  will  be  disposed  to  hold  that  a  technical 
compliance  will  be  sufficient  to  prevent  a  forfeiture.  Thus, 
where,  in  answer  to  the  question  as  to  the  relative  situation 
of  other  buildings,  it  was  said  that  there  were  two  within 
fifty  feet,  this  was  held  to  be  a  literally  truthful  answer,  and 
sufficient  to  prevent  a  forfeiture,   although  in  point  of  fact 

1  Hall  V.  People's  Mat.  Ins.  Co.,  6  Gray  (Mass.),  185. 

2  Frost  V.  Saratoga  County  Mat.  Fire  Ins.  Co.,  5  Denio  (N.  Y.),  154  ;  Susque- 
hanna Ins.  Co.  V.  Perrine,  7  Watts  &  Serg.  (Pa.)  348;  Jennings  v.  Chenango 
County  Mut.  Ins.  Co.,  2  Denio  (N.  Y. ),  75  ;  Burritt  v.  Saratoga  County  Mut. 
Ins.  Co.,  5  Hill  (N,  Y.),  188  ;  Trench  v.  Chenango  County  Mut.  Ins.  Co.,  7  id. 
122  ;  Hardy  v.  Union  Mut.  Fire  Ins.  Co.,  4  Allen  (]\Iass.),  217.  The  decision  in 
Trench's  case,  that  the  rule  does  not  apply  in  cases  of  insurance  on  personal 
property,  is  substantially  overraled  in  Wilson  i;.  Herkimer,  &c.  Ins.  Co.,  6  N.  Y. 
5.3.  See  also  Kennedy  v.  St.  Lawrence,  &c.  Ins.  Co.,  10  Barb.  (N.  Y.)  285  ; 
Associated,  &c.  Ins.  Co.  v.  Assum,  5  Md.  165.  In  the  last  case  "  premises  "  is 
held  to  apply  to  "goods."     Ante,  §§  228,  24.3. 

3  Tebbetts  v.  Hamilton  Mut.  Ins.  Co.,  1  Allen  (Mass.),  305  ;  Abbott  v.  Shaw- 
mut  Mut.  Fire  Ins.  Co.,  3  Allen  (Mass.),  213. 

*  Sayles  v.  North  Western  Ins.  Co.,  2  Curtis  (U.  S.  C.  Ct.),  610. 

527 


§  259]  INSURANCE :   FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  XI, 

one  of  the  buildings  was  within  two  feet  of  the  insured 
premises.  1  A  building  fifty  feet  away  from  another  is  not 
"contiguous"  to  it.^     [Nor  one  twenty-five  feet  away.^] 

§  259.  Surroundings ;  How  Bounded ;  Situation.  —  But  a 
slight  variation  in  the  language  of  the  application  may  make 
a  very  material  difference.  Thus,  where  the  question,  in- 
stead of  calling  for  the  relative  distance  from  other  build- 
ings and  distance  from  each,  is,  "How  bounded?  and  the 
distance  from  other  buildings  if  less  than  ten  rods  ?  "  it  has 
been  held  that  a  statement  of  the  nearest  contiguous  build- 
ings, without  stating  all  within  ten  rods,  was  all  tliat  was 
required.  To  say  the  least,  such  a  form  of  inquiry  left  it 
fairly  open  to  the  insured  to  infer  that  all  he  was  called 
upon  to  mention  was  such  buildings  as  were  contiguous  to, 
and  bounded,  the  insured  premises.'^  The  less  specific  in- 
quiry, as  to  "the  relative  situation  of  other  buildings,"  with- 
out any  limitation  as  to  distance,  leaves  the  matter  open  to 
the  judgment  of  the  assured;  and  it  would  seem  to  be  all 
that  can  reasonably  be  Required  that  he,  having  regard  to 
the  object  of  the  inquiry  and  to  the  circumstances  of  the 
case,  should,  in  good  faith,  designate  such  buildings  as  he 
believes,  or  has  reason  to  believe,  will  fairly  answer  this 
question.  5  Upon  this  point  a  very  interesting  case  was 
early  tried  before  Shepley,  C.  J.,  in  Maine,  where  the  pol- 
icy was  to  be  void  "if  any  circumstances  material  to  the 
risk  be  suppressed,"  and  where  to  the  questions,  "What  are 
the  buildings  occupied  for  that  stand  within  four  rods  ?  how 
many  buildings  are  there  to  the  fires  of  which  this  may  be  in 
any  case  exposed  ?  "  there  was  no  answer ;  and  to  the  further 
question,  "What  distances  from  other  buildings?"  the  an- 
swer was,   "East  side  of  the  block  small  one-story  sheds, 

1  Allen  V.  Charlestown  JIut.  Ins.  Co.,  5  Gray  Mass.),  384.  See  also  Sayles 
V.  North  Western  Ins.  Co.,  2  Curtis  (U.  S.  C.  Ct.),  610. 

2  Ark  ell  v.  Commf-rce  Ins.  Co.,  69  N.  Y.  191. 

3  [Olson  V.  St.  Paul  Fire  &  Mar.  Ins.  Co.,  35  Minn.  432  (ambiguities  go 
against  the  company).] 

*  Gates  V.  Madison  County  Mut.  Ins.  Co.,  2  Comst.  (X.  Y.)  43  ;  s.  c.  1  Seld. 
(N.  Y.)  469,  reversing  s.  c.  3  Barb.  (N.  Y.)  73  ;  Masters  v.  Madison  County  Mut. 
Ins.  Co.,  11  id.  624. 

6  Hall  V.  People's  Mut.  Ins.  Co.,  6  Gray  (Mass.),  185. 

528 


CH.  XI.]      SPECIAL    PROVISIONS    OF    THE    CONTRACT,   ETC.         [§  260 

and  would  not  endanger  the  building  if  they  should  burn." 
The  fact  was  that  the  fire  broke  out  in  a  building  across  the 
street,  within  less  than  fifty  feet  of  the  insured  premises, 
extended  to  the  sheds,  through  which  it  was  communicated 
to  the  property  of  the  insured.  It  was  claimed  that  there 
was  concealment  in  not  stating  the  existence  of  the  building 
in  which  the  fire  originated,  and  misrepresentation  in  stat- 
ing that  the  sheds  were  such  that  if  burned  they  would  not 
be  a  source  of  danger.  But  the  court  ruled  that  if  the  an- 
swers were  in  good  faith,  and  according  to  the  best  judg- 
ment of  the  insured,  and  if  the  opinion  which  he  gave — the 
questions  being  such  as  to  involve  in  the  answer,  to  a  con- 
siderable extent,  matter  of  opinion  —  was  honestly  enter- 
tained, however  erroneous  they  might  be  viewed  in  the  light 
of  subsequent  events,  he  was  entitled  to  recover.  The  plain- 
tiff had  a  verdict,  and,  upon  exceptions,  the  ruling  was 
sustained.^ 

§  260.  Description.  —  In  the  description  of  buildings  on 
which  insurance  is  sought  care  should  be  taken  to  give  not 
only  a  description  of  the  main  building,  but  also  of  the  sub- 
ordinate structures  attached,  such  as  kitchens,  sheds,  store- 
houses, and  the  like,  as  these  latter,  save  in  exceptional 
cases,  are  part  and  parcel  of  the  structure,  and  are  there- 
fore material. 2  Yet  if  the  insurers  have  such  a  description 
of  the  premises  as,  though  leaving  the  matter  open  and 
doubtful,  puts  them  on  inquiry,  and  they  do  not  choose  to 
make  further  inquiry,  but  accept  the  application  as  it  is, 
and  issue  a  policy  thereon,  they  cannot  afterwards  set  up 
misrepresentation  in  defence,  although  the  description  be 
inaccurate.^  So  if  the  answer  be  imperfect  upon  its  face, 
and  does  not  convey,  or  pretend  to  convey,  the  information 
required  by  the  question,  the  company  issuing  a  policy  upon 

^  We  have  given  the  opinion  in  another  connection  Dennison  v.  Thomas- 
ton  Mut.  Ins.  Co.,  20  Me.  125  ;  ante,  §  211.  See  also  Casey  v.  Gohlsmid,  4  L. 
C.  (Q.  B.)  107  ;  reversing  s  c.  2  L.  C.  200  ;  s.  c.  3  Bennett,  Fire  Ins.  Cas. 
67.5. 

2  Chase  v.  Hamilton  Ins.  Co.,  20  N.  Y.  52  ;  Day  v.  Conway  Ins.  Co.,  52 
Me.  60. 

8  Woods  V.  Atlantic  Mut.  Ins.  Co.,  50  Mo.  112. 

VOL.  I.  —  34  529 


§  261]         insukance:  fiee,  life,  accident,  etc.         [ch.  xi. 

such  obviously  imperfect  answer  will  not  be  allowed  to  set 
up  the  imperfection  in  defence. ^ 

§  261.  Description ;  Evidence.  —  A  technically  untrue  de- 
scription may  be  shown  to  be  true  by  proof  of  a  usage,  as  by 
showing  that  a  house  filled  in  with  hrick  in  front  and  rear, 
and  supported  by  brick  buildings  on  the  sides,  is  regarded 
among  insurers  as  a  house  "filled  in  with  brick. "2  And  so 
a  builder  may  be  permitted  to  testify  that  buildings,  built, 
the  first  two  stories  of  brick,  and  above  that  by  being  filled 
in  with  brick,  would  be  regarded  as  "  brick  buildings. "  ^  It 
is  a  "brick  building"  within  the  meaning  of  the  policy,  if  it 
is  so  termed  in  common  parlance,  even  though  it  may  have 
one  wall  which  is  partly  or  wholly  constructed  of  wood.^ 
Indeed,  a  false  description  is  in  many  policies  only  made  a 
ground  of  defence  when  it  has  the  effect  to  obtain  insurance 
at  a  lower  rate  than  if  a  true  description  had  been  given. 
And  this  would  seem  to  be  a  sensible  as  well  as  practical 
standard;  for  if  the  insurers  would  have  taken  the  risk  at 
the  same  rate  had  they  known  the  truth,  they  ought  not  to 
complain.^  If  there  is  room  to  doubt,  such  matter  of  de- 
scription will  be  regarded  as  inserted  rather  for  the  purpose 
of  identification  than  as  a  warranty.*^  (a) 

1  Peoria  Mar.  &  Fire  Ins.  Co.  v.  Perkins,  16  Mich.  381. 

2  Fowler  v.  ^Etna  Fire  Ins.  Co.,  7  Wend.  (N.  Y.)  270. 

3  Mead  v.  Northwestern  Ins.  Co.,  3  Seld.  (N.  Y.)  530. 

*  Gerhanser  v.  North  Brit.  &  Mer.  Ins.  Co.,  7  Nev.  174. 

s  Columbian  Ins.  Co.  v.  Lawrence,  2  Pet.  (U.    S. )    25  ;  Dobson  v,   Sotheby, 
1  Moo.  &  Malk.  90  ;  Moliere  v.  Pa.  Fire  Ins.  Co.,  5  Rawle  (Pa.),  342. 
6  Gerhauser  v.  North  Brit.  &  Mer.  Ins.  Co.,  7  Nev.  174.      ^ 

(a)  Thus,  a  mistake  in  a  proof  of  thereon,  his  act  does  not  bind  the  ten- 
loss  in  regard  to  the  number  of  the  ant,  in  an  action  by  him  upon  a  fire 
building  does  not  affect  the  right  of  the  policy  on  property  contained  in  the 
assured  to  recover  if  the  description  of  building  described  by  its  changed  num- 
the  building  corresponds  in  other  re-  ber.  Westfield  Cigar  Co.  v.  Ins.  Co.  of 
spects  with  that  contained  in  the  North  America,  165  Mass.  541. 
policy,  and  the  insurer  is  not  shown  to  If  the  defence  to  an  action  upon  a 
have  been  misled  or  prejudiced  by  the  policy  against  loss  by  fire  is  that  the 
error.  Faulkner  v.  Manchester  Fire  property  in  a  certain  room  was  not 
Ass.  Co.,  171  Mass.  349.  If  the  owner  covered  by  the  words  in  the  policy 
of  land,  without  any  authority,  substi-  "contained  in  brick  block,"  the  plain- 
tutes  another  number  for  the  official  tiff,  to  show  that  his  rooms  were  part 
number  of  the  entrance  to  the  building  of  a  single  brick   block,  may  show  its 

530 


CH.  XI.]      SPECIAL    PROVISIONS    OF   THE   CONTRACT,   ETC.   [§  263  A 

§  2G2.  Description ;  Estoppel.  —  But  knowledge  of  the  com- 
pany or  its  agents  of  the  untruthfuhiess  of  the  statements  as 
to  the  distance  of  neighboring  buildings,  or  of  inaccuracy 
or  incompleteness  in  the  description  of  the  property,  at  the 
time  when  the  insurance  is  effected,  by  the  general  concur- 
rence of  the  more  recent  decisions,  will  estop  the  insurers 
from  setting  up  such  untruthfulness  in  defence.^ 

§  263.  Description  of  Person.  —  A  statement  of  relation- 
ship in  the  description  of  the  person  whose  life  is  insured  is 
usually  a  matter  of  warranty,  as  where  the  applicant  states 
that  the  person  for  whose  benefit  the  insurance  is  made  is 
his  wife.  If  it  be  not  expressly  made  a  warranty,  there  can 
be  no  doubt  of  its  materiality.  The  interest  of  a  mistress  in 
the  preservation  of  the  life  might  be  much  less  than  that  of 
a  wife.  Whether  therefore  such  a  statement  be  a  warranty 
or  a  misrepresentation  it  would  be  fatal  to  the  policy. ^ 

[§  263  A.  Covenants  to  keep  Books  in  Safe,  keep  Stock  up, 
not  to  Question  after  Death  ;  Fall  of  Building,  etc.  —  A  mer- 
chant's covenant  to  keep  his  books  "in  a  safe  at  night," 
does  not  mean  from  sunset  to  sunrise,  but  from  the  time  the 
business  of  the  day  is  over,  which  may  be  9  or  10  p.m.  or 
later.2(a)     The  company's  agent  for  adjustment  may  waive 

1  Ante,  §  143  ;  post  497  ct  seq.  ;  Clark  §.  Union  Mut.  Fire  Ins.  Co.,  40  N.  H. 
333  ;  Longhurst  v.  Conway  Fire  Ins.  Co.,  U.  S.  Dist.  Ct.  Iowa,  1861  ;  Clark's 
Dig.  Fire  Ins.  Gas.  (3d  ed.)  p.  96  ;  Plumb  v.  Cattaraugus  County  Mut.  Ins.  Co., 
18  N.  Y.  392  ;  James  River  Ins.  Co.  v.  Merritt,  47  Ala.  387. 

2  Stanard  v.  Am.  Pop.  Life  Ass.  Co.,  Superior  Ct.,  city  of  Buffalo,  cited  by 
Bliss,   Ins.   164. 

3  [Jones  V.  Southern  Ins.   Co.,  38  Fed.  Rep.  19,  21  (Ark.),  1889.] 

construction,     ownership,     appearance.  Pottery    building    is    covered    by    the 

and  use,  and  that  it  bore  one   name,  policy,  if  there  is  nothing  in  the  policy 

and  was  commonly  designated  by  that  to  indicate  that  any  other  structure  was 

name.     Westtield  Cigar  Co.  v.  Ins.  Co.  intended  to  be  covered  than   the   one 

of  North  America,  169  Mass.  382  ;   165  building  designated.     Forbes  v.  Ameri- 

Mass.  541.     But,  at  the  trial  of  an  ac-  can  Ins.  Co.,  164  Mass.  402. 
tion  on  a  policy,  in  which  the  property  (a)  Upon   the  iron-safe   clause,    see 

insured  is  described  as  a  "three-story  Parsons  v.    Knoxville  F.   Ins.  Co.,  132 

brick    building    occupied    as    pottery.  Mo.  583  ;  Brown  v.    I'iilatine  Ins.  Co., 

situate   in    E.,    known   as  the   Pottery  89  Texas,  590  ;  Liverpool,  &c.  Ins.  Co. 

building,"  the  plaintiff  cannot  success-  v.  Sheffy,  71  Miss.  919  ;  Western  Ass. 

fully   contend    that    another    building  Co.      McGlathery,  115  Ala.  213.     This 

subsequently  built  on  the  end   of  the  clause  is  not  a  warranty,  and  substantial 

531 


§  263  A]      INSURANCE  :  fire,  life,  accident,  etc.        [ch.  XI. 


the  condition  of  the  policy  as  to  keeping  the  books  and  in- 
voices in  a  fireproof  safe,  by  demanding  duplicates  of  the 
burned  invoices,  and  inducing  the  insured  to  incur  trouble 
and  expense  in  obtaining  them.^  A  plea  that  the  insured 
promised  to  keep  up  his  stock  to  !|2,000,  and  that  he  failed 

1  [Brown  v.  State  Ins.  Co.,  74  Iowa,  428.] 


compliance  only  is  required.  Liverpool, 
&c.  Ins.  Co.  V.  Kearney  (Ind.  Ter.),  27 
Ins.  L.  J.  873  ;  Murphy  v.  Royal  Ins. 
Co.  (La.),  29  id.  210.  See  Goldman  v. 
North  British  &  Merc.  Ins.  Co. ,  48  La. 
An.  223  ;  Goddard  v.  East  Texas  F. 
Ins.  Co.,  67  Texas,  69.  When  requir- 
ing a  fire-proof  safe,  it  is  not  a  warranty 
that  the  safe  will  preserve  the  books. 
Knoxville  F.  Ins.  Co.  v.  Hird  (Tex.  Civ. 
App.),  2.3  Ins.  L.  J.  16. 

The  covenant  by  the  insured  in  the 
policy  to  keep  books  and  to  keep  them 
at  night  in  a  fire-proof  safe,  or  other 
safe  place,  has  been  held  not  to  aff'ect 
the  risk  and  to  be  without  considera- 
tion, so  that  its  violation  does  not  work 
a  forfeiture.  Phcenix  Ins.  Co.  v.  Angel 
(Ky.),  26  Ins.  L.  J.  722;  Mechanics*  & 
Traders'  Ins.  Co.  v.  Floyd  (Ky.),  28  id. 
335  ;  Citizens'  Ins.  Co.  v.  Crist  (Ky.), 
56  S.  W.  658 ;  Kemendo  v.  Western 
Ass.  Co.  (Tex.  Civ.  App.),  57  S.  W. 
293.  Contra,  cases  supra ;  Lozano  v. 
Palatine  Ins.  Co.,  78  Fed.  Rep.  278  ; 
Niagara  F.  Ins.  Co.  v.  Forehand,  27 
Ins.  L.  J.  73;  58  lU.  App.  161.  Where 
the  policy  recited  a  single  gross  pre- 
mium for  indemnity  of  $ "on  the 

following  described  property  "  :  a  cer- 
tain amount  on  building,  another  on 
stock,  and  another  on  fixtures,  a  viola- 
tion of  the  iron-safe  clause  was  held  not 
to  prevent  recovery  on  the  building 
and  fixtures.  Hanover  F.  Ins.  Co.  v. 
Crawford  (120  Ala.),  28  Ins.  L.  J.  945. 
Where  the  clause  is  valid,  the  books 
are  required  to  be  kept  so  as  to  be  in- 
telligible and  accurate.  Pelican  Ins.  Co. 
V.  Wilkerson,  53  Ark.  353.  See  Home 
Ins.  Co.  V.  Delta  Bank,  71  Miss.  608. 

The  clause  is  complied  with,  when 
during  a  fire,  the  books  are  removed  un- 

532 


der  a  reasonable  fear  of  the  security  of  the 
safe,  some  being  dropped  and  burned,  if 
due  care  is  used  in  the  removal.  East 
Texas  F.  Ins.  Co.  v.  Harris  (Tex.  Civ. 
App.),  23  Ins,  L.  J.  552.  See  Liverpool, 
&c.  Ins.  Co.  V.  Kearney,  supra.  Where 
the  insured  store  was  kept  open  after 
dark  for  business,  as  was  the  custom  ; 
but  the  door  was  kept  locked,  and  cus- 
tomers knocked  for  admission,  and  the 
bookkeeper  having  left  for  a  few  min- 
utes, intending  to  return,  the  fire  oc- 
curred during  his  absence,  it  was  held 
that  the  store  was  open  for  business 
within  the  meaning  of  the  policy  clause, 
which  required  the  books  to  be  locked 
in  an  iron  safe  at  night,  and  at  all  times 
when  the  store  was  not  open  for  busi- 
ness. Sun  Ins.  Co.  v.  Jones,  54  Ark. 
376.  See  Southern  Ins.  Co.  v.  Parker, 
61  Ark.  207.  The  iron-safe  clause  may 
by  waived.  Georgia  Home  Ins.  Co.  v. 
Allen  (119  Ala.),  28  Ins.  L.  J.  119. 

An  intentional  failure  to  keep  books 
of  account  showing  correct  purchases 
and  sales,  and  to  keep  the  books  in 
some  place  secure  from  fire,  is  a  proper 
2)lea,  and  establishes  a  defence  when 
such  failure  is  made  a  ground  of  for- 
feiture by  the  policy.  A  refusal  to 
submit  such  books-  and  invoices  for 
examination  after  the  loss,  when  re- 
quired by  the  policy,  is  a  bar  to  recov- 
ery, and  it  is  not  sufficient  to  say  they 
were  not  kept.  Niagara  Fire  Ins.  Co.  v. 
Forehand,  27  Ins.  L.  J.  73.  See  Ameri- 
can Central  Ins.  Co.  v.  Ware,  id.  785  ; 
Rissler  r.  American  Cent.  Ins.  Co.,  28  id. 
615 ;  Sun  Mut.  Ins.  Co.  v.  Dudley,  id. 
44 ;  Levine  v.  Lancashire  Ins.  Co., 
26  id.  36  ;  Liverpool,  &c.  Ins.  Co.  v.  El- 
lington, id.  492. 


CH.  XL]      SPECIAL   PROVISIONS    OF   THE    CONTRACT,    ETC.    [§  263  B 

to  do  SO,  is  insufficient  to  defeat  the  plaintiff's  suit.  The 
failure  to  perform  a  stipulation  cannot  be  transformed  into 
a  fraud  in  procuring  the  contract  so  as  to  avoid  it.  And  as 
in  this  case  it  seems  that  the  insured  allowed  his  stock  to 
fall  far  below  the  amount  of  the  insurance,  the  company  was 
benefited  and  its  risk  reduced  by  the  breach  of  agreement.^ 
A  stipulation  on  the  back  of  a  policy  that  no  question  as  to 
the  validity  of  the  application  or  certificate  shall  be  raised 
after  the  death  of  the  member  binds  the  company,  and  evi- 
dence of  fraud  and  misrepresentation  in  the  application  will 
be  excluded. 2  A  policy  conditioned  for  forfeiture  if  the 
building  falls,  is  not  avoided  by  the  fall  of  part  of  the  struc- 
ture.^ Otherwise  if  the  condition  specifies  "the  fall  of  the 
building  or  any  part  of  it.  "^] 

[§  263  B.  Substantial  Compliance  enough ;  Failure  by  Fault 
of  Company;  Ill-Worded  Condition.  —  When  a  policy  prohib- 
ited the  "  keeping  "  of  benzine  in  a  store,  but  also  gave  per- 
mission to  keep  one  barrel  of  benzine  or  turpentine  in  tin 
cans,  and  when  it  was  brought  to  the  store  in  a  wooden  bar- 
rel and  there  transferred  to  the  tin  cans,  during  one  of 
which  transfers  an  explosion  and  fire  and  loss  occurred,  it 
was  held  that  there  was  a  substantial  compliance  with  the 
conditions,  and  therefore  a  recovery  could  be  had.^  Sub- 
stantial fulfilment  of  an  agreement  to  keep  buckets  full  of 
water  in  certain  places  is  sufficient.  Literal  compliance  is 
not  enforced.  6  Where  the  application  states  that  no  stove 
pipes  pass  through  floors  or  roofs,  but  all  enter  brick  chim- 
neys, there  is  no  obligation  to  refrain  from  so  passing  a 
pipe,  if  it  is  so  secured  as  to  be  as  safe  as  if  it  entered  a 
brick  chimney.  The  risk  must  not  be  substantially  in- 
creased, that  is  all.''     A  plaintiff  is  discharged  where  per- 

1  [Travis  v.  Peabody  Ins.  Co.,    28  W.  Va.  583,  597.] 

2  [Wright  V.  Mut.  Benefit  Ass.,  43  Hun,  61.] 
8  [Security  Ins.  Co.  v.  Mette,  27  Brad.  324.] 
*  [111.  Mut.  Ins.  Co.  V.  Mette,  id.  330.] 

'"  [Maryland  Fire  Ins.  Co.  v.  Wliiteford,  31  Md.  219,  226.  See  §  218,  sub- 
stantial fulfilment  sufficient.] 

6  [Cady  V.  Imperial  Ins.  Co.,  4  Cliff.  203,  211.] 
^  [Bankhead  v.  Des  Moines  Ins.  Co.,  70  la.  387.] 

533 


§  263  D]  INSURANCE  :   FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  XI. 

formance  of  a  condition  is  prevented  by  the  defendant.^ 
Failure  of  the  insured  to  fulfil  an  agreement  he  made  to  in- 
sure all  goods  consigned  to  or  shipped  by  him  in  the  same 
company,  will  not  avoid  his  policy,  unless  it  is  expressly  so 
conditioned  in  the  policy. ^  When  the  insurance  was  upon 
goods,  and  a  condition  in  the  policy  made  it  void  for  "light- 
ing the  premises  insured  by  camphene,  &c.,"  the  condition 
was  held  operative,  although  inapt  in  expression, ^  the  insur- 
ance being  on  goods,  not  premise s.'\ 

[§  263  C.  Evidence ;  Burden  of  Proof.  —  Expert  evidence 
is  not  admissible  to  show  that  the  erection  of  adjacent  build- 
ings increases  the  risk.  No  one  can  be  deemed  an  expert  as 
to  a  matter  of  common  experience.^  Evidence  of  the  cus- 
tomary method  of  drying  will  not  be  received  in  determin- 
ing the  question  whether  the  substitution  of  a  fire-dryer  for 
a  steam-dryer  in  a  hominy  mill  was  an  increase  of  risk.^ 
When  the  charter  of  a  company,  which  was  made  a  part  of 
the  policy,  provided  that  it  should  be  void  if  any  other  build- 
ings were  "erected,  alterations  made,  &c.,"  the  burden  of 
proving  a  breach  of  this  was  held  to  be  on  the  company.^] 

[§  263  D.  Canada  Statutes.  —  In  Canada  the  conditions  of 
an  insurance  policy  are  prescribed  by  law,  and  although  they 
may  be  varied  by  agreement  of  the  parties,  the  courts  are 
watchful  to  exclude  unreasonable  changes.  An  insurance 
company  that  has  not  complied  with  the  law  of  Canada  in 
regard  to  the  printing  of  conditions,  cannot  set  up  against 
the  insured  either  his  own  or  the  statutory  conditions.^ 
Conditions  in  an  Ontario  policy  varying  the  statutory  con- 
ditions must  be  stated  as  variations,  or  the  policy  will  be 
subject  to  the  statute  only.^  Where  the  statiite  prohibits 
more  than  twenty-five  pounds  of  powder,  and  the  applicant 

1  [Bowes  V.  Nat.  Ins.  Co.,  20  N.  B.  R.  438.] 

2  [Ark.  Ins.  Co.  v.  Bostick,  27  Ark.  539.] 

3  [Stettiner  v.  Granite  Ins.  Co.,  5  Duer,  594,  596.] 

*  [Franklin  Fire  Ins.  Co.  v.  Gruver,  100  Pa.  St.  266.] 

5  [German-American  Ins.  Co.  v.  Steiger,  109  111.  254.] 

6  [Ritter  V.  Sun  Mut.  Ins.  Co.,  40  Mo.  40,  41.] 

"^  [Citizens',  &c.  Ins.  Co.  v.  Parsons,  4  Can.  Supr.  Ct.  R.  215.] 
8  [Hartney  v.  North  British  Fire  Ins.  Co.,  13  0nt.  R.  581,  583] 

534 


CIT.  XL]      SPECIAL    PROVISIONS    OF   THE    CONTRACT,   ETC.    [§  263  E 

said  he  did  not  keep  more  than  ten  pounds,  whereupon  the 
policy  was  drawn  so  as  to  prohibit  more  than  ten  pounds, 
and  a  fire  occurred  when  the  plaintiff  had  more  than  ten  and 
less  than  twenty-five  pounds,  it  was  held  that  the  statute  did 
not  prevent  the  company  from  stipulating  for  a  less  quantity 
of  gunpowder,  and  the  policy  was  void.^] 

§  263  E.  Massachusetts  Standard  Policy,  (a)  —  "A  company 
may  write  upon  the  margin  or  across  the  face  of  a  policy,  or 
write,  or  print  in  type  not  smaller  than  long  primer,  upon 
separate  slips  or  riders  to  be  attached  thereto,  provisions 
adding  to  or  modifying  those  contained  in  the  standard 
form ;  and  all  such  slips,  riders,  and  provisions  must  be 
signed  by  the  officers  or  agent  of  the  company  so  using 
them. 

"The  said  standard  form  of  policy  shall  be  plainly  printed, 
and  no  portion  thereof  shall  be  in  type  smaller  than  long 
primer,   and  shall  be  as  follows,  to  wit:  — 


1  [Parsons  v.  Queen's  Ins.  Co.,  2  Ont.  R.  45  ;  Armour,  J.,  dissenting  on  the 
ground  that  the  condition  being  more  onerous  than  the  statute,  was  unjust  and 
unreasonable.] 


(a)  The  legislature  of  a  State  cannot 
by  statute  delegate  to  its  insurance  com- 
missioner legislative  power  to  prepare 
and  adopt  the  standard  form  of  policy 
of  such  State.  Anderson  v.  Manchester 
r.  Ass.  Co.,  59  Minn.  182  ;  Dowling  v. 
Lancashire  Ins.  Co.,  92  Wis.  63.  In 
New  York  a  general  statement  by  an 
insurance  agent  to  an  applicant  that  he 
is  "  insured  "  amounts  to  a  valid  parol 
insurance  according  to  the  standard  fire 
policy  of  that  State.  Hicks  v.  British 
America  Ass.  Co.,  162  N.  Y.  284.  The 
insurer's  agent  cannot  waive  the  stipu- 
lations of  a  standard  policy.  See  Hicks  v. 
British  America  Ass.  Co. ,  162  N.  Y.  284; 
Moore  v.  Hanover  F.  Ins.  Co.,  141  N.Y. 
219;  Bourgeois  V.  Northwestern  Nat.  Ins. 
Co.,  86  Wis.  606  ;  supra,  §  100,  n.  (a). 
In  Massachusetts  an  agent  of  an  insur- 
ance company  to  whom  the  company  has 
intrusted  blank  policies  of  the  Massa- 


chusetts standard  form  signed  by  the 
proper  officers,  with  authority  to  coun- 
tersign and  issue  such  policies,  and  also 
to  grant  permits  for  vacancies  and  for 
repairs  by  attaching  written  or  printed 
permits  to  policies  and  sending  copies 
thereof  to  the  company,  has  no  authority 
to  bind  the  company  by  an  oral  agree- 
ment to  grant  such  a  permit.  Hill  v. 
Commercial  Union  Ass.  Co.,  164  Mass. 
406.  The  insurer,  after  premiums  have 
been  long  paid,  will  not  be  allowed  to 
defend  on  the  ground  that  its  policy  is 
not  according  to  the  standard  form. 
Armstrong  v.  Western  Manufacturers' 
Mut.  Ins.  Co.,  95  Mich,  137.  And  the 
requirement  that  policies  are  to  be  in 
the  standard  form  does  not  prevent  an 
oral  agreement  to  insure  during  removal 
until  the  policy  can  be  changed.  Good- 
hue V.  Hartford  F.  Ins.  Co.,  175  Mass. 
187. 

535 


§  263  E]      INSURANCE :  fire,  life,  accident,  etc.        [ch.  XL 

«'No.  $ 

"  [Corporate  name  of  the  company  or  association  :  its  principal 
place  or  places  of  business.] 

"  This  company  shall  not  be  liable  beyond  the  actual  value  of 
the  insured  property  at  the  time  any  loss  or  damage  happens. 

"  In  consideration  of  dollars  to  them  paid  by  the  insured, 

hereinafter  named,  the  receipt  whereof  is  hereby  acknowledged,  do 
insure  against  loss   or   damage  by    fire,    to   the    amount    of 

dollars. 

''  (Description  of  property  insured.) 

''Bills  of  exchange,  notes,  accounts,  evidences  and  securities  of 
property  of  every  kind,  books,  wearing  apparel,  plate,  money, 
jewels,  medals,  patterns,  models,  scientific  cabinets  and  collections, 
paintings,  sculpture,  and  curiosities  are  not  included  in  said  in- 
sured property,  unless  specially  mentioned. 

"  Said  property  is  insured  for  the  term  of  ,  beginning  on 

the  day  of  ,   in   the   year   eighteen  hundred    and 

,  at  noon,  and  continuing  until  the  dav  of  , 

in  the  year  eighteen  hundred  and  ,  at  noon,  against  all  loss 

or  damage  by  fire  originating  from  any  cause  except  invasion, 
foreign  enemies,  civil  commotions,  riots,  or  any  military  or 
usurped  power  whatever;  the  amount  of  said  loss  or  damage  to 
be  estimated  according  to  the  actual  value  of  the  insured  property 
at  the  time  when  such  loss  or  damage  happens,  but  not  to  include 
loss  or  damage  caused  by  explosions  of  any  kind  unless  fire  ensues, 
and  then  to  include  that  caused  by  fire  only. 

"This  policy  shall  be  void  if  any  material  fact  or  circumstance 
stated  in  writing  has  not  been  fairly  represented  by  the  in- 
sured, —  or  if  the  insured  now  has  or  shall  hereafter  make  any 
other  insurance  on  the  said  property  without  the  assent  in  w^riting 
or  in  print  of  the  company,  —  or  if,  without  such  assent,  the  said 
property  shall  be  removed,  except  tlmt,  if  such  removal  shall  be 
necessary  for  the  preservation  of  the  property  from  fire,  this  policy 
shall  be  valid  without  such  assent  for  five  days  thereafter,  —  or  if, 
without  such  assent,  the  situation  or  circumstances  affecting  the 
risk  shall,  by  or  with  the  knowledge,  advice,  agency,  or  consent  of 
the  insured,  be  so  altered  as  to  cause  an  increase  of  such  risks,  or 
if,  without  such  assent,  the  said  property  shall  be  sold,  or  this 
policy  assigned,  or  if  the  premises  hereby  insured  shall  become 
vacant  by  the  removal  of  the  owner  or  occupant,  and  so  remain 
536 


CH,  XI.]      SPECIAL   PEOVISIONS    OF   THE    CONTRACT,   ETC.    [§  263  E 

vacant  for  more  than  thirty  days  without  such  assent,  or  if  it  be  a 
manufacturing  establishment  running  in  whole  or  part  extra  time, 
except  that  such  establishments  may  run  in  whole  or  in  part  extra 
hours  not  later  than  nine  o'clock  p.  M.,  or  if  such  establishments 
shall  cease  operation  for  more  than  thirty  days  without  permission 
in  writing  indorsed  hereon,  or  if  the  insured  shall  make  any  at- 
tempt to  defraud  the  company,  either  before  or  after  the  loss,  —  or 
if  gunpowder  or  other  articles  subject  to  legal  restriction  shall  be 
kept  in  quantities  or  manner  different  from  those  allowed  or  pre- 
scribed by  law,  —  or  if  camphene,  benzine,  naphtha,  or  other 
chemical  oils  or  burning  fluids  shall  be  kept  or  used  by  the  insured 
on  the  premises  insured,  except  that  what  is  known  as  refined 
petroleum,  kerosene,  or  coal-oil  may  be  used  for  lighting. 

' '  If  the  insured  property  shall  be  exposed  to  loss  or  damage  by 
fire,  the  insured  shall  make  all  reasonable  exertions  to  save  and 
protect  the  same. 

"In  case  of  any  loss  or  damage  under  this  policy,  a  statement 
in  writing,  signed  and  sworn  to  by  the  insured,  shall  be  forthwith 
rendered  to  the  company,  setting  forth  the  value  of  the  property 
insured,  the  interest  of  the  insured  therein,  all  other  insurance 
thereon,  in  detail,  the  purposes  for  which  and  the  persons  by  whom 
the  building  insured,  or  containing  the  property  insured,  was  used, 
and  the  time  at  which  and  manner  in  which  the  fire  originated,  so 
far  as  known  to  the  insured.  The  company  may  also  examine  the 
books  of  account  and  vouchers  of  the  insured,  and  make  extracts 
from  the  same. 

*'In  case  of  any  loss  or  damage,  the  company,  within  sixty  days 
after  the  insured  shall  have  submitted  a  statement,  as  provided  in 
the  preceding  clause,  shall  either  pay  the  amount  for  which  it  shall 
be  liable,  or  replace  the  property  with  other  of  the  same  kind  and 
goodness,  —  or  it  may,  within  fifteen  days  after  such  statement  is 
submitted,  notify  the  insured  of  its  intention  to  rebuild  or  repair 
the  premises,  or  any  portion  thereof  separately  insured  by  this 
policy,  and  shall  thereupon  enter  upon  said  premises  and  proceed 
to  rebuild  or  repair  the  same  with  reasonable  expedition.  It  is 
moreover  understood  that  there  can  be  no  abandonment  of  the 
property  insured  to  the  company,  and  that  the  company  shall  not 
in  any  case  be  liable  for  more  than  the  sum  insured,  with  interest 
thereon  from  the  time  when  the  loss  shall  become  payable,  as  above 
provided. 

537 


§  263  E]        INSURANCE  :    FIRE,  LIFE,  ACCIDENT,  ETC.  [CH.  XI. 

"  If  there  shall  be  any  other  insurance  on  the  property  in- 
sured, whether  prior  or  subsequent,  the  insured  shall  recover  on 
this  policy  no  greater  proportion  of  the  loss  sustained  than  the 
sum  hereby  insured  bears  to  the  whole  amount  insured  thereon. 
And  whenever  the  company  shall  pay  any  loss,  the  insured  shall 
assign  to  it,  to  the  extent  of  the  amount  so  paid,  all  rights  to 
recover  satisfaction  for  the  loss  or  damage  from  any  person,  town, 
or  other  corporation,  excepting  other  insurers;  or  the  insured,  if 
requested,  shall  prosecute  therefor  at  the  charge  and  for  the  account 
of  the  company. 

"If  this  policy  shall  be  made  payable  to  a  mortgagee  of  the  in- 
sured real  estate,  no  act  or  default  of  any  person  other  than  such 
mortgagee  or  his  agents,  or  those  claiming  under  him,  shall  affect 
such  mortgagee's  right  to  recover  in  case  of  loss  on  such  real 
estate  (a)  /provided,  that  the  mortgagee  shall,  on  demand,  pay  ac- 
cording to  the  established  scale  of  rates  for  any  increase  of  risks 
xiot  paid  for  by  the  insured;  and  whenever  this  company  shall  be 
liable  to  a  mortgagee  for  any  sum  for  loss  under  this  policy,  for 
which  no  liability  exists  as  to  the  mortgagor,  or  owner,  and  this 
company  shall  elect  by  itself,  or  with  others,  to  pay  the  mortgagee 
the  full  amount  secured  by  such  mortgage,  then  the  mortgagee 
shall  assign  and  transfer  to  the  companies  interested,  upon  such 
payment,  the  said  mortgage,  together  with  the  note  and  debt 
thereby  secured, 

"  This  policy  may  be  cancelled  at  any  time  at  the  request  of 
the  insured,  who  shall  thereupon  be  entitled  to  a  return  of  the  por- 
tion of  the  above  premium  remaining,  after  deducting  the  cus- 
tomary monthly  short  rates  for  the  time  this  policy  shall  have  been 
in  force.  The  company  also  reserves  the  right,  after  giving  writ- 
ten notice  to  the  insured,  and  to  any  mortgagee  to  whom  this 
policy  is  made  payable,  and  tendering  to  the  insured  a  ratable  pro- 
portion of  the  premium,  to  cancel  this  policy  as  to  all  risks  subse- 
quent to  the  expiration  of  ten  days  from  such  notice,  and  no 
mortgagee  shall  then  have  the  right  to  recover  as  to  such  risks, 

"In  case  any  difference  of  opinion  shall  arise  as  to  the  amount 
of  loss  under  this  policy,  it  is  mutually  agreed  that  the  said  loss 

(a)  Under  this  clause,  a  fire  policy  by  the  mortgagor  witliout  the  insurer's 

continues  in  force   for  the  mortgagee's  consent.     Palmer  Sav.  Bank  v.  Ins.  Co, 

benefit,   so  far  as  his  interest  ap])ears,  of  North  America,  166  Mass,  189, 
although  the  insured  estate  is  conveyed 

538 


CH.  XI.]      SPECIAL   PROVISIONS   OF  THE   CONTRACT,  ETC.  [§  263  E 

shall  be  referred  to  three  disinterested  men,  the  company  and  the 
insured  each  choosing  one  out  of  three  persons  to  be  named  by  the 
other,  and  the  third  being  selected  by  the  two  so  chosen,  provided 
that  neither  party  shall  be  required  to  choose  or  accept  any  person 
who  has  served  as  a  referee  in  any  like  case  within  four  months  : 
and  the  decision  of  a  majority  of  said  referees  in  writing  shall  be 
final  and  binding  on  the  parties. 

'  *  Ko  suit  or  action  against  this  company  for  the  recovery  of  any 
claim  by  virtue  of  this  policy  shall  be  sustained  in  any  court  of 
law  or  equity  in  this  commonwealth  unless  commenced  within  two 
years  from  the  time  the  loss  occurred. 

"  In   witness  whereof  the   said  company  has    caused   this 

policy  to  be  signed  by  its  president  and  attested  by  its  secretary 
[or  by  such  proper  oflficers  as  may  be  designated],  at  their  office 
in  [date]  "  ^ 

1  The  whole  of  section  263  E  has  been  extracted  from  the  Public  Statutes, 
pp.  713-715. 

539 


insurance:   fire,  life,   accident,   etc.  [CH.  XII. 


CHAPTER   XII. 


ALIENATION.  ^ 

Analysis. 

1. 

Change  of  title  by  sale,  gift,  marriage  settlement,  devise,  any  way  but 
by  descent,  §  266, 
is  an  alienation,  and  avoids  the  policy  unless  the  insurers  consent  to  it 
expressly,  or  by  implication  from  usage  and  the  nature  of  the  case, 
as  with  a  stock  of  goods  ;  see  §§  265,  278. 
absolute  alienation  suspends  policy,  and  destroys  it  if  title  is  out  of 
the  insured  at  time  of  loss,  whether  there  is  an  express  stipulatiou 
to  that  effect  or  not,  §  264.  . 
a  provision  that  the  policy  shall  be  "  void  "  for  alienation  means  void- 
able, §  264. 
even  descent  is  fatal  if  the  policy  is  to  be  void  for  change  of  title  "  by 
operation  of  law,"  §  266. 
If  the  alienation  is  only  executory,  or  is  without  authority,   or  in  any 
way  incomplete  or  a  failure,  the  policy  is  not  affected,  §  267  ;  see 
§§  268-269  a. 
So  long  as  a  scintilla  of  interest  remains  in  the  assured  the  policy  is 
good,  §  268. 
unless  the  legal  estate  is  retained  on  purpose  to  defeat  the  conditions, 

§  267. 
unconditional  delivery  of  personal  property  is  an  alienation,  §  268. 
The  object  of  provision  against  transfer  is  to  prevent  diminution  of  the 
interest  which  tends  to  prevent  the  insured  from   carelessness  or 
fraud.     Any  change  that  substantially  increases  the  motive  to  burn 
the  property  is  a  violation  of  the  provision,  §  273. 
a  change  that  increases  the  assured's  motive  for  vigilance  does  not 
avoid  the  policy  though  contrary  to  its  letter,  §  275. 
An  alienation  by  a  mortgagor  after  assignment  of  the  policy  with  consent 
of  the  insurers  is  the  act  of  a  stranger  and  does  not  avoid  the  con- 
tract, §  276. 

2.   Mortgage  axd  Foreclosttre. 
A  mortgage  before  complete  and  valid  foreclosure,  whether  on  real  (§  269), 
or  personal  (§  270)  estate,  is  not  an  alienation,  §§  269,  n.,  269  a  end, 
and  276  C.     Ccmtra,  Indiana  and  Michigan,  §  -69. 
mere  entry  or  commencement  of  foreclosure  proceeding    not   fatal, 
§§  276  C,  269  a. 
unless  expressly  so  asrreed,  §§  269  a,  276  C. 

and   even  then  knowledge  of  the  agent  may  estop  the  company, 
§  282  B. 

^  See  Appendix  to  this  chapter. 

540 


CH.  XII.]  ALIENATION. 

and  entry  of  foreclosure  between  the  application  and  the  issues  of  the 
policy  may  not  be  covered  by  its  terms,  §  276  0. 
foreclosure  sale  under  valid  mortgage  is  an  alienation,  §  273. 

not  so  under  an  invalid  mortgage,  §  269  a. 
if  the  period  of  redemption  expires,  consent  of  the  mortgagee  next  day 

to  extend  it  cannot  save  the  policy,  §  276  C. 
fire   before    foreclosure   sale,    though  on  same  day,   company  liable, 

§  276  C. 
pending  foreclosure,    insurance   in  favor  of  mortgagee   and  assigns, 

company  bound,  §  276  C.  ^      o  o~^  n 

foreclosure  sale  without  deed  or  report  of  sale,  not  a  transfer,  §2/6  0. 
"judgment  in  foreclosure"  to  avoid  must  be  one  that  of  itself  effects 
a  transfer,  §  276  C.  .... 

Mortgage  held  an    "  alteration  of  ownership  "  and  an   '  alienation  m 

part,"  §  271.  .  ,     ,   ^        ^     -r  • 

Conditional  sale  no  alienation,  nor,  in  equity,  is  an  absolute  sale  if  in- 
tended only  as  security  for  debt;  but  at  law  parol  will  not  be  ad- 
mitted to  show  that  a  deed  absolute  on  its  face  is  really  only  a 
mortgage,  §  272  ;  and  see  §  264. 
and  it  is  not  necessary  to  have  a  defeasance  dehors  the  deed  recorded, 

§272. 
unless  it  is  required  by  statute,  §  272. 
conveyance  and  reconveyance  on  trust  for  asssured,  not  an  alienation, 
neither  is  a  lease,  §  272.  ,„„.,„  ,       c  o-o 

Transfer  from  husband  to  wife  through  B.  not  fatal,  §  273  ;  contra,  §  2/o. 
Partners.     Sale  or  mortgage  or  other  transactions  between  partuei-s  or 
joint  owners  not  an  alienation,  according  to  the  best  view,  §§  2r9- 

281;  contra,  §  280.  ,    o    -r, 

no  new  interest  or  element  of  carelessness  is  introduced,  §  2/9. 
but  when  this  is  done,  as  by  taking  in  a  new  partner,  the  policy  is 
avoided.     A  renewal  after  the  change  is  good,  however,  although 
the  company  did  not  know  of  it,  §  279. 
in  such  cases  there  is  apt  to  be  trouble  about  the  proper  parties  to  the 
action,  and  it  is  best  on  change  of  partnership  property  to  assign 
the  policy  with  assent  of  the  insurers,  §  281. 
transfer  between  co-tenants  not  fatal,  §  280  ;  contra,  §  280. 
levy  of  execution,  §  274.  ^    ec  o«7   ^^A 

alienation  must  be  by  the  one  having  the  insured  interest,  §§  267,  end, 

and  276. 
transfer  of  one  of  several  distinct  parcels,  §  278. 
"  change  of  possession." 

change  of  tenants  not,  §  273  A. 
nor  possession  under  a  revocable  license,  §  273  A. 
refers  to  "right  of  possession,"  §  273  A. 
a  contract  to  sell,  though  with  delivery  and  part  payment,  no  alien- 

ation,  §§  267,  n.,  276  B,  and  contra,  §  267,  n. 
Sale,  see  next  two  heads. 

Fatal  Cases: 

transfer  in  bankruptcy  on  insolvency,  §§  264,  2/6  A. 
sale  on  credit,  §  276  A.  _ 

sale  and  mortgage  back,  though  vendor  keeps  possession,  §  276  A. 

541 


§  264]        insurance;  fike,  life,  accident,  etc.        [ch.  xii. 

deed  absolute  and  return  deed  giving  life-right  of  occupancy  to  ven- 
dor, §  276  A. 

sale  to  mortgagee,  §  276  A. 
Cases  not  fatal : 

trust-deed,  §  276  B,  or  deed  with  trust  back,  §  272. 

a  lease,  §§  272,  276  B. 

selling  off  a  stock  of  goods,  §§  265,  278. 

sale  by  trustee  to  himself  or  for  his  benefit,  §  276  B. 

sale  after  cause  of  loss  though  before  actual  loss,  §  276  B. 

sale  of  part  interest,  §  276  B. 

sale  of  land  under  insured  buildings,  §  276  B. 

ultra  vires  sale  by  school  committee,  §  276  B. 

sham  sale  to  cheat  creditors,  §  276  B. 

foreclosure  ;  see  §  276  C,  and  above  under  "  Mortgage." 
Entire  Contract.     Where  the  premium  is  entire,  alienation  or  other  breach 
of  condition  in  respect  to  a  part  of  the  property  vitiates  the  contract 
as  to  all,  §  277. 

other  cases  hold  however  that  a  misrepresentation,  sale,  or  other  breach 
of  condition  affecting  only  a  part  of  the  property  merely  avoids  the 
policy  pro  tanto,  §  278. 

true  test,  see  §  277,  first  note? 

if  each  has  its  specific  premium  the  policy  really  includes  several  con- 
ti-acts,  and  the  avoidance  of  one  may  not  affect  the  otliers,  §  277. 

and  the  same  rule  should  apply  where  the  premium  is  apportionable 
on  a  clear  and  just  principle,  §  277,  n. 

if  the  assured  has  acted  in  good  faith  he  should  not  lose  his  whole  in- 
surance by  a  breach  as  to  part,  unless  such  is  the  clear  intent  of  the 
agreement,  or  a  just  division  of  the  contract  is  impossible. 
Waiver,  §§  282-282  B. 

assent  to  conveyance  cures  all  preceding  (§  282),  but  not  subsequent 
transfers,  §  282  A. 

in  general,  assent  of  agent  sufficient,  §  282  A. 

not  if  policy  requires  indorsement,  §  282  A  ;  contra,  §  282  A. 

payment  of  dividend  to  partner  after  transfer  to  him  is  a,  §  282  A. 

consent  to  corresponding  assignment  of  policy  is  a,  §  252  A. 
but  indorsement  "  payable  to  "  not,  §  282  A. 
unless  with  knowledge  of  the  facts,  §  282  A. 
levy  waived,  §  282  A. 

and  sale  of  land  under  house,  §  282  A. 

knowledge  of  the  agent  and  his  omission  of  proper  endorsement  estops 
company  in  case  of  ignorant  applicant,  §  282  B. 

parol  evidence  that  policy  was  to  be  drawn  to  cover  intended  transfer 
not  admissible  ;  suit  should  be  for  reformation,  §  282  B,  New  York. 

§  264.  Limitation  of  Risk ;  Alienation.  —  It  follows  from 
the  general  principle  that  the  insured  cannot  recover  save 
in  exceptional  cases  for  a  loss,  unless  it  appear  that  he  had 
an  interest  in  the  subject-matter  of  insurance,  as  well  at  the 
time  of  the  loss  as  at  the  time  when  the  insurance  was 
effected,  that  if  he  parts  with  his  interest  subsequent  to  the 
542 


CII.  XII.]  ALIENATION.  [§  264 

insurance,  and  at  the  time  of  the  loss  has  no  longer  an  in- 
surable interest,  he  will  have  no  claim  upon  the  company. 
This  parting  with  his  interest  is  termed  in  the  law  of  insur- 
ance an  alienation.  The  term  is  derived  from  the  law  of  real 
property,  and  is  there  defined  to  be  "any  method  of  acquir- 
ing title  wherein  estates  are  voluntarily  resigned  by  one  man 
and  accepted  by  another,  whether  that  be  effected  by  sale, 
gift,  marriage  settlement,  devise,  or  other  transmission  of 
property  by  the  mutual  consent  of  the  parties."  It  is  title 
by  purchase  in  contradistinction  to  title  by  descent. ^  And 
this  alienation,  if  absolute,  works  a  forfeiture  whether  so 
stipulated  in  the  policy  or  not,  if  the  property  remains  out 
of  the  insured  at  the  time  of  the  loss.^  So  does  a  donation 
inter  vivos,  without  restriction  except  that  the  donor  shall 
not  alienate,  or  dispose  of,  except  by  will.^  And  an  abso- 
lute deed,  whether  warranty  or  quitclaim,  with  a  mortgage 
back,  or  an  unsealed  agreement  to  reconvey  on  the  payment 
of  a  stipulated  sum,*  is  an  alienation.^  So  is  a  conveyance 
by  a  husband  to  a  trustee  for  his  wife,  though  the  trust  be 
immediately  executed.  ^  (<?)  So  an  absolute  conveyance  by  a 
mortgagor  of  his  equity  to  the  mortgagee,  taking  but  not 
recording  a  bond  for  reconveyance  on  payment  of  a  certain 
sum,  is,  in  Massachusetts,  an  alienation,  the  statute  of  that 
State  providing  that  an  absolute  conveyance  shall  not  be  de- 
feated by  an  unrecorded   defeasance.'^      So  is  a  transfer  to 

1  2  Blackstone,  Comm.  287 ;  Burbank  v.  Rockingham  Mut.  Fire  Ins.  Co.,  4 
Fost.  (N.  H.)  550. 

2  Wilson  V.  Hill,  3  Met.  (Mass.)  66  ;  ^tna  Ins.  Co.  v.  Tyler,  16  Wend.  (N.  Y.) 
385. 

8  Macarty  v.  Com.  Ins.  Co.,  17  La.  365. 
*  Adams  v.  Rockingham  Mut.  Fire  Ins.  Co.,  29  Me.  292. 
6  Ibid.  ;  Home  Mut.  Fire  Ins.  Co.  t;.  Hauslein,  60  111.  521  ;  Abbott  v.  Hamp- 
den Ins.  Co.,  30  Me.  414.     See  also  post,  §  269. 

6  Oakes  v.  Manufacturing  Ins.  Co.,  Mass.,  April,  1881. 
-'  Foote  V.  Hartford  Fire  Ins.  Co.,  119  Mass.  259. 

(a)  Where,  as  in  Nebraska,  the  stat-  use  and  benefit,  and  subject  to  his  con- 

ute  of  uses  is  not  in  force,  a  conveyance  trol,  cannot  be  treated  as  an  executed 

by  a  husband  to  a  third  person,  who  use,  making  the  husband  still  the  owner, 

conveys  the  property  to  his  wife  under  Farmi-rs'  &  M.  Ins.  Co.  v.  Jensen  (Neb.), 

atrreement  that  she  will  hold  it  for  his  78  N.  W.  1054  ;  76  id.  577. 

543 


§  264]  INSURANCE  :    FIRE,  LIFE,   ACCIDENT,   ETC.         [CH.  XII. 

the  assignee,  by  decree  of  the  court,  of  a  bankrupt's  estate, 
under  the  bankrupt  laws  of  the  United  States,  upon  the 
bankrupt's  petition.  He  is  thereby  divested  of  all  his  prop- 
erty, and  it  becomes  vested  in  the  assignee.  That  the  pro- 
ceedings may  be  stayed,  and  thus  the  property  become 
revested  in  him,  is  a  contingency  too  remote  to  be  consid- 
ered the  foundation  of  a  remaining  insurable  interest  in  the 
bankrupt.  He  has  no  power  to  reclaim  the  property,  and 
has  no  right  to  it  in  law  or  equity  by  any  contract  executed 
or  executory.  One  may  be  interested  in  the  avails  of  prop- 
erty alienated,  and  yet  have  no  right  to  the  property  itself. ^ 
And  of  course  a  voluntary  assignment  for  the  benefit  of  cred- 
itors is  equally  a  transfer, ^  unless  possession  be  retained  by 
the  assignor. 3  Even  an  assignment,  fraudulent  and  void  as 
against  creditors,  by  virtue  bf  the  insolvent  laws,  has  been 
held  an  alienation.  As  the  case  stood  before  the  court  the 
assignment  was  as  if  it  were  valid,  since  the  court  held  the 
assignor  estopped  from  setting  up  his  own  fraud  for  the  pur- 
pose of  getting  back  to  his  original  title.*  And  so,  perhaps, 
is  a  sale  by  a  master  in  chancery  of  a  mortgagor's  interest 
under  a  decree  of  foreclosure,  with  part  payment  of  the  pur- 
chase-money and  execution  by  the  vendee  of  the  articles  of 
sale,  although  the  decree  is  not  enrolled,  and  no  deed  is  de- 

1  Young  V.  Eagle  Fire  Ins.  Co.,  14  Gray  (Mass.),  150  ;  Adams  v.  Eoekingham 
Mut.  Fire  Ins.  Co.,  29  Me.  (16  Sliep. )  292  ;  Perry  v.  Lorillard  Ins.  Co.,  6  Lans. 
(N.  Y.)  201.  Where  the  policy  was  npon  personal  property,  and  payable  to  the 
mortgagee  in  case  of  loss,  and  the  mortgage  amounted  to  mQ,re  than  the  value 
of  the  property,  it  was  held  that  an  as,signment  in  bankruptcy  did  not  work  a 
change  in  the  title.  Appleton  Iron  Co.  v.  Brit.  Am.  Ass.  Co.,  46  Wis.  23.  The 
case  is  distinguished  from  those  cases  where  the  insurance  is  upon  real  estate,  as 
a  mortgage  of  personal  property  conveys  the  title  to  the  mortgagor,  while  one  on 
real  estate  does  not.  In  Starkweather  v.  Cleveland  Ins.  Co.,  C.  Ct.,  19  Am.  Law 
Eeg.  333,  2  Abb.  U.  S.  67,  5  Bennett's  Fire  Ins.  Cas.  328,  it  was  held  that  an 
assignment  in  bankruptcy  in  pursuance  of  involuntary  proceedings  was  no  viola- 
tion of  a  provision  against  a  change  or  transfer  of  title. 

2  Dey  V.  Poughkeepsie  Mut.  Ins.  Co.,  23  Barb.  (N.  Y.)  623;  Hazard  v.  Frank- 
lin Mut'  Fire  Ins.  Co.,  7  R.  1.  429  ;  McQueen  v.  Phoenix  Ins.  Co.,  U.  C.  (Ct.  of 
App.)  15  Can.  L.  J.  190,  overruling  s.  c.  in  Q.  B.  ;  Little  v.  Eureka  Ins.  Co.,  Cin. 
Sup.  Ct.,  5  Ins.  L.  J.  154. 

8  Phoenix  Ins.  Co.  v.  Lawrence,  4  Met.  (Ky.)  9. 

*  Dadmun  Manufacturing  Co.  v.  Worcester  Mut.  Fire  Ins.  Co.,  11  Met,  (Mass.) 
429 ;  Birdsey  v.  City  Fire  Ins.  Co.,  26  Conn.  165  ;  post,  §  273. 

544 


CH.  XII.  ■  ALIENATION.  [§  266 

livered.  The  deed,  when  delivered,  relates  to  the  time  of 
the  sale.  1  We  say  "perhaps,"  because  the  rule  is  admitted 
to  be  different  in  England,  and  the  decision  seems  to  rest 
upon  the  practice  in  New  York.  The  weight  of  authority 
undoubtedly  is,  that  the  "transfer  and  change  of  title,"  to 
use  the  language  of  the  policy  in  this  case,  does  not  take 
place  till  the  deed  is  delivered,  or  there  is  a  confirmation 
by  the  court  of  the  proceedings  had  under  its  order. ^  [The 
clause  declaring  that  if  the  property  "  is  alienated,  the  pol- 
icy shall  be  void,"  is  construed  to  mean  that  alienation 
makes  the  policy  voidable  at  the  election  of  the  company.  ^J 

§  265.  Temporary  Alienation  ;  Parol  Lease ;  Sale  of  Part  of 
Property  insured.  — ■  Where,  however,  a  policy  prohibiting 
alienation,  on  penalty  of  avoiding  the  policy,  was  issued 
upon  a  store  and  stock  of  goods,  the  oral  lease  of  the  store 
and  a  sale  of  the  stock  of  goods  to  the  lessee,  who  before  the 
expiration  of  the  policy  retransfers  both  the  store  and  the 
remaining  goods  to  the  insured,  have  been  held  not  to  be  a 
violation  of  the  prohibition.  Nor  would  a  sale  from  time  to 
time  of  a  retail  stock  of  goods,  though  during  the  currency 
of  the  policy  the  whole  stock  might  be  changed,  be  a  viola- 
tion of  such  a  condition.* 

§  266.  Change  of  Title  by  Descent  does  not  Avoid  the  Policy 
unless  so  expressed.  —  A  transfer  of  title  by  descent  is  there- 
fore, according  to  the  definition  given,^  no  alienation.  By 
the  death  of  the  ancestor  the  property  descends  to  the  heir, 
it  is  true ;  but  his  title  is  not  by  what  is  technically  under- 
stood to  be  a  conveyance,  purchase,  or  alienation.^     [But  if 

1  McLaren  v.  Hartford  Fire  Ins.  Co.,  1  Seld.  (N.  Y.)  151. 

2  Farmers'  Mut.  Ins.  Co.  v.  Graybill,  7i  Pa.  St.  17  ;  jManhattan  Ins.  Co.  v. 
Stein,  5  Bush  (Ky.),  652. 

3  [Grant  v.  Eliot,  &c.  Mut.  Fire  Ins.  Co.,  75  Me.  196.] 

4  Lane  v.  Maine  Mut.  Fire  Ins.  Co.,  3  Fairf.  (Me.)  44  ;  Power  v.  Ocean  Ins 
Co.,  19  La.  28  ;  West  Branch  Ins.  Co.  v.  Helfenstein,  40  Pa.  St.  289  ;  ante,  §  101 ; 
post,  §  268. 

6  Ante,  §  264.  See  also  Georgia  Home  Ins.  Co.  v.  Kinnier,  28  Grat.  (Va.)  88. 
[The  death  of  the  insured  by  which  his  property  descends  to  heirs  or  devisees  is 
not  an  alienation.     Grant  v.  Eliot,  &c.  Mut.  Fire  Ins.  Co.,  75  Me.  196,  201.] 

6  Burhank  v.  Rockingham  Mut.  Fire  Ins.  Co.,  4  Fost.  (N.  H.)  550.  The  lien 
of  the  company  (a  mutual  one)  does  not  hind  the  heirs.  I"ii(liana  Mut.  Lis.  Co. 
V.  Chamberlain,  8  Blackf.  (Ind.)  150;  and  a  descent  into  the  possession  of  the 
VOL.  I.  —  35  545 


§  267]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  XII. 

a  policy  is  to  be  void  by  any  transfer,  whether  voluntary  or 
by  operation  of  law,  the  death  of  the  insured  avoids  it  un- 
less the  consent  of  the  company  to  the  descent  of  the  prop- 
erty is  obtained.^] 

§  267.  If  Title  not  conveyed,  no  Alienation ;  Executory 
Agreement,  —  In  discussing  its  meaning  as  bearing  upon  the 
subject  of  insurance,  it  has  been  said  to  import  a  conveyance 
of  the  title,  and  that  nothing  short  of  this  would  amount  to 
an  alienation.- («)  [In  general  a  condition  restraining  the 
right  of  selling  or  assigning  leasehold  property  is  not  broken 
by  any  act  of  the  lessee,  which  falls  short  of  divesting  his 
legal  estate,  but  if  the  legal  estate  is  continued  in  him  on 
purpose  to  evade  the  condition,  the  rule  is  otherwise.^] 
"Transfer  of  the  title  in  the  property  insured,"  means  the 
title  and  ownership  of  the'  property  insured,  and  not  the  in- 
terest of  the  insured  therein.*  And  whether  applied  to  real 
or  personal  estate,  it  is  a  disposition  by  the  owner  of  the 
property,  by  which  he  parts  with  all  his  interest,  and  it 
passes  to  another.     An  agreement,  therefore,  to  sell  though 

heirs  vitiates  the  policy  under  a  condition  that  it  shall  be  void  if  the  property 
comes  into  the  possession  of  any  other  than  the  insured.  Lappin  v.  Charter  Oak 
Ins.  Co.,  58  Barb.  (N.  Y.)  325.  Under  a  charter  which  gives  a  lien  for  premiums 
and  other  dues  during  the  continuance  of  the  J'olicy,  and  provides  that  the  pol- 
icy shall  be  avoided  by  alienation,  the  lien  is  not  good  as  against  the  alienee. 
MeCuUoch  v.  Indiana  Mut.  Fire  Ins.  Co.,  8  Blackf.  (Ind. )  50.  It  might  be  other- 
wise if  the  statute  did  not  make  the  policy  void.  Russ  r.  Mutual  Ins.  Co.,  29 
U.  C.  (Q.  B.)  73. 

1  [Hine  V.  Homestead  Fire  Ins.  Co.,  29  Hun,  84,  93  N.  Y.  75  ;  Sherwood  v. 
Agricultural  Ins.  Co.,  73  N.  Y.  447,  451.] 

2  Masters  v.  Madison  County  Mut.  Ins  Co.,  11  Barb.  (N.  Y.  S.  C.)  624. 
8  [Livingston  v.  Stickles,  7  Hill,  253.] 

*  Springfield  Fire  &  Mar.  Ins.  Co.  v.  Allen,  43  N.  Y.  389  ■,.2->osf.,  §  273. 

(«)  Forward  v.  Continental  Ins.  Co.,  Thomas,  90  Va.  658  ;  Pfister  v.  Gerwig, 
142  N.  Y.  382;  McCoy  v.  Iowa  State  122  Ind.  567.  The  clause  against  alien- 
Ins.  Co.,  107  Iowa,  80  ;  Ehrsam  Ma-  ation  does  not  apply  to  a  deed  invalid 
chine  Co.  v.  Phenix  Ins.  Co.,  43  Neb.  because  of  the  grantor's  insanity.  Ger- 
554.  The  value  of  the  consideration  is  ling  v.  Agricultural  Ins.  Co.,  39  W.  Va. 
immaterial.  Brown  i'.  Cotton  &  W.  M.  689.  A  provision  forbidding  transfer 
Ins.  Co.,  156  Mass.  587.  A  change  of  of  the  title  applies  to  the  interest  ac- 
title  by  death  of  the  insured  does  not  quired  by  a  new  co-partner  of  the  in- 
work  a  forfeiture,  the  insurer  not  ob-  sured.  Germania  F.  Ins.  Co.  v.  Home 
jecting  that  a  formal  change  is  not  Ins.  Co.,  144  N.  Y.  195. 
made,     Virginia  F.    &  M.   Ins.  Co.  v. 

546 


CH.  XII.]  ALIENATION.  [§  268 

ill  writing  and  with  delivery  of  possession,  and  a  receipt  of 
part  of  the  purchase-money  in  payment,  is  no  alienation,  so 
long  as  the  title  has  not  passed,  and  the  property  remains  at 
the  risk  of  the  vendor,  though  the  agreement  be  executed 
after  the  loss.  ^  It  can  hardly  be  necessary  to  observe  that 
an  unauthorized  alienation,  as  a  mortgage  by  a  husband  of 
his  wife's  property,  is  in  point  of  law  no  alienation  as 
against  the  wife.^  The  alienation,  unless  otherwise  stipu- 
lated,  must  be  by  the  one  having  the  insured  interest.^ 

§  268.  Alienation  ;  Personal  Property  ;  Delivery.  —  111  caseS 
of  personal  property,  as  the  title  passes  by  delivery,  unless 
there  is  an  agreement  to  the  contrary,  it  is  probable  that  an 
unconditional  delivery  would  be  held  to  amount  to  an  alien- 
ation, and  not  otherwise.*  Worthington  v.  Bearse^  —  a  case 
of  marine  insurance  —  shows  that  an  agreement  for  a  trans- 
fer, so  long  as  it  is  not  completely  executed,  and  so  long  as 
a  scintilla  of  interest  remains  in  the  insured,   will  not  be 


1  Boston  &  Salem  Ice  Co.  v.  Royal  Ins.  Co.,  12  Allen  (Mass.),  381  ;  Davis  v. 
Quincy  Mut.  Fire  Ins.  Co.,  10  id.  113  ;  Masters  v.  Madison  County  Mut.  Ins. 
Co.,  11  Barb.  (N.  Y.)  624  ;  Norcross  v.  Franklin  Ins.  Co.,  17  Pa.  St.  429  ;  Trum- 
bull y.  Portage  Mut.  Fire  Ins.  Co.,  12  Ohio,  305;  Hill  v.  Cumberland  Valley 
Mut.  Prot.  Co.,  9  P.  F.  Smith  (Pa.)  474;  Gilbert  v.  North  Am.  Fire  Ins.  Co.,  23 
Wend.  (N.  Y.)  43  ;  Perry  Ins.  Co.  v.  Stewart,  19  Pa.  St.  45  ;  Shotwell  v.  Jeffer- 
son Ins.  Co.,  5  Bosw.  (N.  Y.  Superior  Ct.)  247  ;  Fire  &  Mar.  Ins.  Co.  v.  Morri- 
son, 11  Leigh  ( Va.),  354 ;  Washington  Ins.  Co.  v.  Kelly,  32  Md.  421.  [A  contract 
by  the  insured  to  convey  at  a  future  day  is  not  a  breach  of  the  condition  against 
sale.  Kempton  v.  State  Ins.  Co.,  62  Iowa,  83.  It  has  been  held  however  that  a 
contract  under  seal  to  sell  the  insured  premises,  and  part  paj'ment  of  the  pur- 
chase-money avoids  a  policy.  Gerniond  v.  Home  Ins.  Co.,  5  T.  &  C.  (N.  Y.)  120, 
121.  And  in  an  Iowa  case  the  assured  agreed  to  sell  to  L.  on  instalments,  the 
deed  to  be  made  when  the  money  was  all  paid,  and  failure  of  any  payment  to 
avoid  tire  whole  contract.  L.  took  possession  under  the  contract,  and  this  was 
held  a  sale  which  forfeited  the  policy.  Davidson  v.  Hawkeye  Ins.  Co.,  71  Iowa, 
532,  Reed,  J.,  dissenting.  The  dissent,  it  seems  to  us,  has  far  greater  weight  in 
this  case  than  the  majority  opinion.  The  contract  with  L.  was  not  a  sale,  but  an 
executory  contract  for  a  sale.  The  title  did  not  pass.  L.  was  not  entitled  to  a 
conveyance  of  the  property  until  he  performed  the  conditions  of  the  agreement.] 

2  Commercial  Ins.  Co.  v.  Spankneble,  52  111.  53. 

»  McEwan  v.  Western  Ins.  Co.,  1  Mich.  (X.  P.)  118. 

*  ^tna  Ins.  Co.  v.  Jackson,  16  B.  Mon.  (Ky.)  242  ;  Phcpuix  Ins.  Co.  v.  Law- 
rence, 4  Met.  (Ky.)  9  ;  Norcross  v.  Insurance  Co.,  17  Pa.  St.  429  :  Boston  &  Salem 
Ice  Co.  V.  Royal  Ins.  Co.,  12  Allen  (Mass.),  381;  Tallman  v.  Atlantic  Ins.  Co., 
3  Keyes  (40  N.  Y.),  87. 

«>  12  Allen  (Mass.),  382. 

547 


§  268]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,  ETC.  [CH   XII. 

treated  as  an  alienation.  The  facts  of  the  case  were  as  fol- 
lows :  The  action  was  on  a  policy  of  insurance  for  two  thou- 
sand dollars,  payable  to  the  plaintiff  in  case  of  loss,  issued 
by  the  defendants  to  David  P.  Nickerson,  upon  seven-eighths 
of  the  schooner  "William  B.  Castle,"  for  one  year  from 
April  8,  1860.  Nickerson  had  mortgaged  his  interest  in 
the  schooner  to  the  plaintiff;  and  afterwards,  on  the  11th  of 
October,  1860,  conveyed  thirteen-sixteenths  of  the  schooner 
to  George  T.  Lovell,  receiving  notes  of  Lovell,  Atwood,  & 
Co.  in  payment,  and  Nickerson  was  to  pay  to  the  plaintiff 
what  was  then  due  to  him,  namely,  about  four  thousand  dol- 
lars. About  the  20th  of  the  same  month,  Lovell  reconveyed 
said  interest  to  Nickerson,  and  took  back  the  notes  which 
had  been  given  in  payment  therefor,  none  of  them  having 
become  due.  This  interest  was  reconveyed  to  Nickerson, 
because  he  could  not  carry  out  his  contract  to  obtain  a  re 
lease  from  the  plaintiff,  as  the  latter  would  not  accept  said 
notes  in  payment  thereof ;  and  on  the  part  of  Lovell,  because 
a  person  who  was  to  be  her  master  was  dissatisfied  with  her ; 
so  that  the  parties  acted  from  different  motives,  and  each 
party  was  ignorant  of  the  motives  of  the  other.  Upon  both 
of  these  transfers,  the  papers  were  changed  in  the  custom- 
house. The  schooner  was  totally  lost  on  or  about  the  16th 
of  March,  1861.  Nickerson  then  owned  seven-eighths  of 
her,  subject  to  the  mortgage  of  Worthington.  Liability  was 
held  to  attach  for  the  full  amount  insured.^ 

1  Bigelow,  C.  J.,  here  said  :  "  We  entertain  no  doubt  that  the  defendants  are 
liable  for  the  full  amount  insured  by  the  policy.  This  liability  rests  upon  two 
grounds,  either  of  which  is  sufficient  to  sustain  the  plaintiff's  claim.  In  the  first 
place,  on  the  facts  stated,  the  alleged  sale  by  the  assured  of  thirteen-sixteenths  of 
the  vessel  covered  by  the  policy  was  incomplete,  and  never  took  effect  so  as  to 
extinguish  his  insurable  interest  therein.  One  of  the  essential  stipulations  of  the 
agreement  of  sale  was  not  complied  with.  The  vendor  expressly  agreed  to  pay 
the  amount  due  on  the  mortgage  of  his  share  of  the  vessel,  and  to  procure  a  re- 
lease from  the  mortgagee.  This,  the  case  finds,  he  did  not  and  could  not  do. 
Until  this  part  of  the  contract  was  complied  with,  the  vendee  had  a  right  to 
avoid  the  sale  and  rescind  the  whole  bargain.  The  delivery  of  the  bill  of  sale 
passed  a  title  only  at  the  election  of  the  vendee.  He  might,  within  a  reasonable 
time  after  the  failure  of  the  assured  to  fulfil  his  contract  of  sale  by  procuring  a 
release  of  the  mortgage  on  the  vessel,  elect  to  restore  the  legal  title  and  recover 
back  the  consideration  of  the  transfer.  During  this  time  the  plaintiff  had  a  con- 
tinuing and  subsisting  interest  in  the  vessel.     The  transfer  couid  not  be  regarded 

548 


CH.    XII.]  ALIENATION.  [§  269 

§  269.  Mortgage,  before  Foreclosure,  no  Alienation  or  Change 
of  Title  ;  Entry  for  Foreclosure  Merger  of  Title.  —  The  charter 
of  a  mutual  insurance  company  provided  that  "when  any 
property  insured  in  the  company  shall  in  any  way  be  alien- 
ated the  policy  thereupon  shall  be  void;"  and  a  by-law  pro- 
vided that  "when  the  title  of  any  property  insured  shall  be 
changed  by  sale,  mortgage,  or  otherwise,  the  policy  shall 
thereupon  be  void;"  and  it  was  held  that  a  mere  mortgage 
did  not  avoid  the  policy.  A  mortgage  is  not  an  alienation, 
nor  is  it,  without  foreclosure,  a  change  of  title.  ^(«)     The 

as  absolute  and  complete,  but  only  conditional  on  a  compliance  with  the  terms  of 
the  bargain.  A  mere  transfer  of  the  legal  title  of  a  vessel  does  not  extinguish  a 
right  to  recover  on  a  policy,  if  the  party  making  the  transfer  still  retains  any 
right  or  interest  in  the  vessel  or  her  proceeds.  (Gordon  v.  Mass.  Ins.  Co.,  2  Pick. 
249  ;  Lazarus  v.  Commonwealth  Ins.  Co.,  19  Pick.  81 ;  Wilson  v.  Hill,  3  Met. 
6Q,  71.)  The  insured  clearly  had  an  interest  in  the  preservation  of  the  vessel,  un- 
til it  was  certain  that  the  contract  for  her  sale  had  become  complete,  and  the  title 
to  her  had  vested  absolutely  in  the  vendee.  In  this  view  of  the  facts,  the  insured 
did  not  forego  his  right  to  recover  on  the  policy  pending  the  transactions  in  rela- 
tion to  the  transfer  of  the  vessel.  The  other  ground  of  decision  is  stated  ante, 
§  101." 

1  Shepherd  v.  Union  Mut.  Fire  Ins.  Co.,  38  N.  H.  232  ;  Folsom  v.  Belknap 
County  Mut.  Fire  Ins.  Co.,  10  Fost.  (N.  H.)  231;  Howard  Ins.  Co.  v.  Bruner, 
23  Pa.  St.  (11  Harris)  50  ;  Jackson  v.  Massachusetts  Mut.  Fire  Ins.  Co.,  23  Pick. 
(Mass.)  418  ;  Conover  v.  Mut.  Ins.  Co.  of  Albany,  3  Denio  (N.  Y.),  254;  s.  c.  1 
Comst.  (N.  Y.)  290 ;  Pollard  v.  Somerset  Mut.  Fire  Ins.  Co.,  42  Me.  221  ;  Smith 
V.  Monmouth  Mut.  Fire  Ins.  Co.,  50  Me.  96;  Button  v.  New  England  Mut.  Fire 
Ins.  Co.,  9  Fost.  (N.  H.)  153  ;  Rollins  v.  Columbian  Mut.  Fire  Ins.  Co.,  5  id. 
200  ;  Rice  et  al.  v.  Tower  &  Trs.,  1  Gray,  426 ;  Aurora  Fire  Ins.  Co.  v.  Eddy,  55 
111.  213;  Com.  Ins.  Co.  v.  Spankneble,  52  111,  53;  Hartford  Fire  Ins.  Co.  v. 
Walsh,  54  id.  164  ;  Kelley  v.  Liverpool,  &c.  Ins.  Co.,  1  Hannay  (N.  B.),  266  ; 
Sands  v.  Standard  Ins.  Co.,  U.  C.  (Ch.),  15  Can.  L.  J.  49;  post,  §  272.  [Byers 
V.  Farmers'  Ins.  Co.,  35  Ohio  St.  606;  Friezen  v.  Allemania  Fire  Ins.  Co.,  30 
Fed.  Rep.  352,  Wis.  1887.  A  mortgage  of  property  insured,  without  giving  up 
possession,  is  not  a  breach  of  the  condition  that  the  "entire  unconditional  and 
sole  ownership  "  must  be  in  the  assured,  or  of  the  conditions  against  selling, 
transferring,  or  change  of  title  or  possession.  Judge  v.  Conn.  Fire  Ins.  Co.,  132 
Mass.  521.] 

{a)  See  Peck  v.  Girard  F.  &  M.  Ins.  v.  Home  Ins.  Co.,  79  "Wis.  399  ;  East 

Co.,  16  Utah,  121 ;  Williamson  v.  Ori-  Texas  F.  Ins.  Co.  v.   Clarke,  79  Texas, 

ent  Ins.  Co.,   100  Ga.  791  ;  Lancashire  23  ;  National  Bank  v.  Union  Ins.  Co., 

Ins.  Co.  V.  Boardman,  58  Kansas,  339  ;  88  Cal.  497  ;  Koshland  v.  Hartford  Ins. 

Vankirk  v.  Citizens'  Ins.  Co.,  79  Wis.  Co.,  31  Oregon,  402.     A  deed  absolute 

627  ;  Tarbell  v.   Vermont  Mut.  F.  Ins.  on  its  face,  but  intended  only  as  secu- 

Co.,  63  Vt.  53  ;  HoUoway  v.  Dwelling-  rity,  though  really  a  mortgage,  does  not 

House  Ins.  Co.,  48  Mo.  App.  1 ;  O'Brien  prevent  the  vendee  being  held  the  "sole 

549 


§  269]  INSUEANCE  :    FIRE,   LIFE,    ACCIDENT,   ETC.         [CH.  XII. 

contrary  doctrine  has,  however,  been  held  in  Indiana,  though 
with  some  hesitation.^  And  in  Michigan ^  it  has  been  held 
that  a  conveyance  absolute  in  form,  but  in  fact  merely  as 
security  for  a  debt,  though  not  a  sale,  is  a  transfer  or  change 
of  title  which  avoids  a  policy.  "The  words,"  say  the  court, 
"  tra7isfer  or  change  of  title,  are  more  comprehensive  than  the 
word  sale,  which  immediately  precedes  them.  A  sale  is  a 
parting  with  one's  interest  in  a  thing  for  a  valuable  consid- 
eration. This  is  what  is  generally  understood  by  the  word, 
and  in  every  sale  there  is  a  transfer  or  change  of  title  from 
the  vendor  to  the  vendee.  But  there  may  be  a  transfer  or 
change  of  title  without  a  sale.  Should  A.  convey  a  piece  of 
property  to  B.  to  hold  in  secret  trust  for  him,  there  would 
be  a  transfer  or  change  of  title  from  A.  to  B.,  but  there 
would  not  be  a  sale  of  the  property,  or  an  actual  parting 
with  it  to  B.  for  a  valuable  consideration,  although  the  con- 
veyance on  its  face  would  import  a  sale  from  A.  to  B.  And 
if  the  trust,  instead  of  being  secret,  appeared  on  the  face  of 
the  conveyance,  there  would  still  be  a  change  of  title.  The 
title  would  no  longer  be  in  A.,  but  in  B.,  his  grantee.  We 
think  such  a  conveyance  would  clearly  come  within  the  con- 
dition of  the  policy  and  put  an  end  to  the  insurance.  "^  (a) 

1  McCuIloch  V.  Indiana  Mut.  Fire  Ins.  Co.,  8  Blackf.  50  ;  Indiana  Mut.  Fire 
lus.  Co.  V.  Coquillard,  2  Carter,  Ind.  645. 

2  Western  Mass.  Ins.  Co.  v.  Riker,  10  Mich.  279. 

3  And  see  ante,  §  264.  If  the  conveyance  is  in  effect  an  equitable  mortgage, 
in  the  form  of  a  deed  of  trust,  it  is  not  a  change  of  title  under  the  Georgia  Code. 
Virginia,  &c.  Ins.  Co.  v.  Feagin  (Ga.),  9  Repr.  173. 

and  unconditional  owner,"  if  he  is  in  nor  a  mortgage  or  deed  of  a  homestead 

possession   and   his   claim   is   overdue,  signed  only  by  the  husband.     German 

Carey  v.   Liverpool,    &c.    Ins.    Co.,   92  Ins.  Co.  v.  York,  48  Kansas,  488.     A 

Wis.  538  ;  Sun  Fire  Office  v.  Clark,  53  lien  for  unpaid  purchase-money  is  not 

Ohio  St.  414;  Hawley  v.   London,  &c.  fatal  under  an  answer  in  the  application 

Ins.  Co.,   102  Cal.   651  ;  see  Carey  v.  that  there  is  no  mortgage.    Phenix  Ins. 

Allemania  F.   Ins.  Co.,  171   Penn.  St.  Co.  r.  Coombes  (Ky.),  22  Ins.  L.  J.  155. 

204.     A   fictitious   mortgage   made   by  As  to  alienations  avoiding  the  policy, 

one  partner  and  kept  by  him  is  not  an  see  further  Morrison  v.  Tennessee  M.  & 

incuiribrance  under  the  insurance  law.  F.  Ins.  Co.  (Mo.),  58  Am.  Dec.  299,  and 

Fitchner  v.  Fidelity  Mut.  F.  Ass'n,  103  note. 

Iowa,  276.     Nor  is  a  mortgage  that  was  (a)    See  Sun  Fire  Office  v.  Clark,  53 

never   delivered  :   Clifton    Coal   Co.   v.  Ohio  St.   414  ;  Gibb  v.    Pliila.   F.  Ins. 

Scottish  Union  Ins.  Co.,  102  Iowa,  300;  Co.,  59   Minn.   267;    Green   v.   Brand, 

550 


CH.  XII.]  ALIENATION.  [§  269  a 

§  269  a.  Mortgage  ;  Entry  of  Foreclosure.  —  In  Mcllltire  v. 
Norwich  Fire  Insurance  Company/  the  policy  contained 
among  its  various  conditions  a  stipulation  in  these  words: 
"  If  the  title  of  the  property  is  transferred  or  changed,  .  .  . 
this  policy  shall  be  void;  and  the  entry  of  a  foreclosure  of  a 
mortgage  .  .  .  shall  be  deemed  an  alienation  of  the  prop- 
erty, and  this  company  shall  not  be  holden  for  loss  or  dam- 
age thereafter."  It  was  held  that  the  words  "the  entry  of  a 
foreclosure  "  does  not  mean  exactly  the  same  as  a  consum- 
mated foreclosure,  and  that  any  act,  which,  of  itself,  with- 
out further  formality  or  process  on  the  mortgagee's  part, 
deprives  the  assured  of  all  right  and  title  in  the  property, 
unless  the  debt  is  paid,  terminates  the  risk.'^ 

1  102  Mass.  230. 

2  The  court  here  said:  "What  are  we  to  understand  by  the  expression,  '  the 
entry  of  a  foreclosure  of  a  mortgage,'  which,  according  to  the  terms  of  the  con- 
tract, '  shall  be  deemed  an  alienation  of  the  property.'  after  which  the  defendants 
'  shall  not  be  holden  for  loss  or  damage '  ?  It  is  a  somewhat  peculiar  form  of  ex- 
pression, not  strictly  and  technically  accurate,  perhaps  ;  but  to  be  interpreted  in 
such  a  manner  as  to  carry  out  the  true  intent  of  the  parties,  so  far  as  that  intent 
is  discoverable.  In  the  case  of  a  mortgage  upon  real  estate,  the  mortgagee,  on 
breach  of  condition,  may  enter  for  the  purpose  of  foreclosure  ;  and,  although  his 
title  may  become  absolute  by  mere  lapse  of  time,  no  other  entry  or  formality  may 
be  required  on  his  part  ;  and  there  is  nothing  in  any  public  record,  or  in  any 
proceeding,  which  can  literally  be  said  to  be  an  entry  of  foreclosure.  In  the  case 
also  of  a  mortgage  of  personal  pi'operty,  the  mortgagee  gives  notice  of  his  inten- 
tion to  foreclose,  in  the  form  prescribed  by  statute,  and  his  title  afterwards  may 
become  absolute  without  any  further  act  or  ceremony  on  his  part.  He  cannot  be 
said  to  enter  upon  the  property,  nor  can  it  in  a  literal  sense  be  said  that  there  is 

1  C.   &   E.  410;    Gerling  v.  Agr.   Ins.  Co.,  44  Neb.  537  ;  Phenix  Ins.   Co.  v. 

Co.,  39    W.  Va.  689  ;    Small  v.   West-  Bowdre,     67    Miss.    620.       A    general 

Chester  F.  Ins.  Co.,  51  Fed.  Eep.  789  ;  assignment  for  the  benefit  of  creditors 

Georgia  Home  Ins.  Co.  v.   Hall,  94  Ga.  usually  avoids  a  policy  under  a  clause 

630  ;    Brick  v.   Campbell,   122    N.    Y.  therein  against  transfers.     Orr  v.  Han- 

337  ;    Phoenix  Ins.   Co.  v.  Asberry,   95  over  F.  Ins.  Co.,  158   111.  149.     But  as 

Ga.  792.     When  the  beneficiary  is  in  a  receiver  appointed  by  the  court  has 

possession  and  pays  the  premium,  and  merely  a  right  of  custody,  and  the  title 

the  policy  is  issued  to  his  trustee,  and  to  personalty  is  not  changed  by  his  ap- 

these  facts  are  made  known  to  the  in-  pointment,  such  appointment  is  not  a 

surer's  agent,  there  is  no  forfeiture  for  change  of  title  by  sale  or  judicial  decree 

non-ownership,  or  because  the  trustee  as     to    property    previously    conveyed 

afterwards  conveys  the  property  to  the  voluntarily  to  trustees  to  secure  credi- 

beneficiary.     Rhode  Island  Underwrit-  tors    and    insured    by    such    trustees, 

ers'  Ass'n  v.  Monarch,  98  Ky.  305.    See  Georgia  Home  Ins.  Co.  v.  Bartlett,   91 

Rochester  Loan  &  B.  Co.  v.  Liberty  Ins.  Va.  305. 

551 


§  269  a]  INSUKANCE  :    FIKE,   life,   accident,   etc.       [cH.  XII. 

When,  however,  the  title  becomes  absolute  in  the  mort- 
gagee or  his  assigns,  by  foreclosure,  or,  what  is  tantamount 
to  a  foreclosure,  merger  in  the  purchaser  of  the  equity,  who 
subsequently  takes  an  assignment  of  the  mortgage,  the  trans- 
fer is  complete  and  the  change  of  title  is  an  alienation ;  ^ 
unless  the  insurance  is  by  the  mortgagor,  for  the  benefit  of 
the  mortgagee,  who  signs  the  premium  note  and  pays  assess- 
ments, in  which  case,  as  the  title  and  property  remains 
in  the  hands  of  the  person,  liable  to  the  company,  fore- 
closure is  no  alienation.2  And  the  foreclosure  must  be 
absolute.  If  it  be  incomplete,  and  there  is  an  outstanding 
equity   of  redemption,    it  is  no  sale   or  conveyance.^     But 

an  entry  of  foreclosure.  In  both  cases,  the  first  step  towards  foreclosure  is  the 
manifestation  of  the  intent  to  fort^close,  which  is  to  be  indicated  in  such  manner 
as  the  law  points  out,  accompanied  with  a  formal  registration  in  the  public 
records.  It  is  very  mauifest,  as  we  think,  that  the  words  '  the  entry  of  a  fore- 
closure,' as  used  in  the  policy,  are  not  to  be  interpreted  as  meaning  exactly  the 
same  thing  as  a  consummated  and  finished  foreclosure.  The  policy  provides  not 
merely  for  the  transfer,  but  the  change  of  title,  and  the  insurer  may  very  naturally 
have  considered  an  entry  for  foreclosure  as  a  material  change  in  the  title  of  the 
assured,  and  in  his  relation  to  the  property.  The  parties,  in  their  contract,  have 
taken  pains  to  avoid  saying  simply  that  '  the  foreclosure  of  a  mortgage  '  shall  be 
deemed  an  alienation.  There  would  be  no  occasion  for  them  to  say  that,  inasmuch 
as  the  law  would  plainly  have  said  it  for  them.  The  meaning  of  the  policy,  in 
our  judgment,  is,  that  something  short  of  an  actual  and  com]3lete  foreclosure  shall 
be  considered,  for  the  purposes  of  their  contract,  as  a  transfer  or  change  of  title, 
and  that  an  entry  for  foreclosure,  or  an  act  which  of  itself,  and  without  any  fur- 
ther formality  or  process  on  the  part  of  the  mortgagee,  will  deprive  the  assured  of 
all  right  and  title  in  the  ])roperty,  unless  he  pay  the  debt,  shall  be  deemed  suffi- 
cient to  terminate  the  risk.  The  defendant  might  well  be  unwilling  to  continue 
to  insure  property  which  is  so  situated  that  its  destruction  by  fire  might  be  the 
easiest  or  only  way  to  make  it  beneficial  to  the  assured."  In  Colt  v.  Phoenix  Ins, 
Co.,  54  N.  Y.  595,  the  phrase  "commencement  of  foreclosure  proceedings"  was 
held  to  have  no  reference  to  proceedings  to  enforce  a  mechanic's  lien. 

1  Macomber  ■«.  Cambridge  Mut.  Fire  Ins.  Co.,  8  Cush.  (Mass.)  133  ;  McLaren 
V.  Hartford  Fire  Ins.  Co.,  1  Seld.  (X.  Y.)  151  ;  Mt.  Vernon  Manufacturing  Co. 
V.  Summit  County  Mut.  Fire  Ins.  Co.,  10  Ohio  St.  347  ;  Brunswick  v.  Commer- 
cial Ins.  Co.,  68  Me.  313. 

2  Bragg  V.  N.  E.  Mut.  Fire  Ins.  Co.,  5  Fost.  (N.  FT.)  289. 

3  Strong  V.  Manufacturers'  Ins.  Co.,  10  Pick.  (Mass.)  40  ;  Loy  v.  Insurance 
Co.,  24  Minn.  315.  See  also  McKissick  v.  Millowners'  Ins.  Co.,  50  Iowa,  116, 
where  the  foreclosure  was  held  complete  notwithstanding  legal  proceedings  were 
pending  to  correct  an  error.  The  proceedings  in  this  case  were  perfected  and 
a  decree  had.  In  a  case  where  proceedings  were  pending  and  afterwards  dis- 
missed, the  court  held  that  there  was  no  foreclosure.  Georgia  Home  Ins.  Co.  v. 
Kinnier,  28  Gratt.  (Va.)  88.  See  also  Bishop  v.  Clay  Ins.  Co.,  45  Conn.  430.  See 
§  269,  n. 

552 


CH.  XII.]  ALIENATION.  [§  270 

a  complete  foreclosure   under   an   invalid   mortgage    is   no 
alienation.^ 

§  270.  Alienation ;  Chattel  Mortgage.  —  And  a  mortgage 
of  personal  property  would  seem  to  stand  upon  the  same 
ground, 2  certainly  while  the  mortgagor  has  the  posses- 
sion.^ (a)  A  mortgage  is  something  less  than  an  alienation.* 
But  in  Tallman  v.  Atlantic  Fire  and  Marine  Insurance  Com- 
pany, it  was  held  that  the  execution  and  delivery  of  a  chat- 
tel mortgage  was  a  "sale,  transfer,  or  change  of  title," 
though  it  was  not  necessary  for  the  court  to  go  so  far,  as 
in  fact  there  had  been  in  that  case,   prior  to  the   loss,  a 

1  Scammon  v.  Commercial  Union  Ins.  Co.,  Ct.  of  App.  (111.),  9  Ins.  L.  J. 
715  ;  Jecko  v.  St.  Louis,  &e.  Ins.  Co.,  7  Mo.  (Ct.  of  App.)  308. 

2  Holbrook  v.  Am.  Ins.  Co.,  1  Curtis  (U.  S.  C.  Ct.),  193  ;  Van  Deusen  v.  Char- 
ter Oak  Fire  &  Mar.  Ins.  Co.,  1  Robt.  (N.  Y.  Superior  Ct.)  55.  [A  provision 
that  "  if  the  property  be  sold  or  transferred,  or  any  change  take  place  in  title  or 
possession,  whether  by  legal  process  and  judicial  decree,  or  voluntary  transfer 
or  conveyance,"  the  policy  should  be  void,  is  not  violated  by  giving  a  chattel 
mortgage  on  the  property.  Hennessey  v.  Manhattan  Fire  Ins.  Co.,  28  Hun,  98; 
Hanover  Fire  Ins.  Co.  v.  Connor,  20  Brad.  297  (no  breach  until  the  mortgage 
matures).] 

3  Rice  y.  Tower,  1  Gray  (Mass.),  426  ;  Phoenix  Ins.  Co.  v.  Lawrence,  4  Met. 
(Ky. )  9.  [A  deed  pledging  the  property  to  secure  a  debt,  the  pledgor  remaining 
in  possession,  does  not  avoid  the  policy.  Nussbaum  v.  Northern  Ins.  Co.,  37 
Fed.  Rep.  524  (Ga.),  1889.] 

*  Orrell  v.  Hampden  Fire  Ins.  Co.,  13  Gray  (Mass.),  431. 

(a)  See  Taylor  L'.  Merchants'  Ins.  Co.,  Johansen  v.  Home  F.  Ins.  Co.,  54  Neb. 
83  Iowa,  402  ;  Olney  v.  German  Ins.  548  ;  Omaha  F.  Ins.  Co.  v.  Dierks,  43 
Co.,  88  Mich.  94  ;  Morotock  Ins.  Co.  Neb.  473  ;  Gould  v.  Dwelling-House 
V.  Rodefer,  92  Va.  747  ;  Peet  v.  Dakota  Ins.  Co.,  134  Penn.  St.  570  ;  Russell  v. 
F.  &  M.  Ins.  Co.,  7  So.  Dak.  410  ;  Cedar  Rapids  Ins.  Co.,  78  Iowa,  216. 
German-American  Ins.  Co.  v.  Hum-  See  German-American  Ins.  Co.  v.  Hum- 
phrey, 62  Ark.  348 ;  Caplis  v.  Ameri-  phrey,  62  Ark.  348.  A  mere  renewal, 
can  F.  Ins.  Co.,  60  Minn.  376  ;  First  subsequent  to  the  insurance,  of  existing 
National  Bank  v.  American  Central  Ins.  incumbrances,  with  accrued  interest 
Co.,  58  Minn.  492  ;  Wilcox  v.  Conti-  added,  is  not  a  new  incumbrance  within 
nental  Ins.  Co.,  85  Wis.  193  ;  Smith  v.  the  meaning  of  a  fire  policy.  Kansas 
Continental  Ins.  Co.,  6  Dak.  433.  A  Farmers'  F.  Ins.  Co.  v.  Saindon,  52 
policy  is  only  avoided  by  a  change  in  Kansas,  486  ;  53  id.  623.  Nor  is  the 
the  known  incumbrances  where  there  is  substitution  of  a  new  mortgage  of  sub- 
an  increase  as  to  the  amount  thereof ;  stantially  the  same  amount,  when  the 
but  even  if  personal  property  be  charged  mortgagee  in  the  existing  mortgage  re- 
with  a  mortgage  after  insurance  thereof,  quires  payment  at  maturity.  Koshland 
contrary  to  its  terms,  this  does  not  v.  Home  Ins.  Co.,  31  Oregon,  321  ; 
prevent  recovery  if  the  mortgage  is  Koshland  v.  Fire  Ass'n,  id.  362. 
discharged     before     the    loss    occurs. 

553 


§  272]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,    ETC.  [CH.  XII. 

foreclosure,  with  possession  in  the  mortgagee,  and  no  out- 
standing equity  of  redemption.  The  case  was  afterwards 
reversed,^  under  such  a  state  of  facts  as  brings  the  case  into 
accord  with  the  other  authorities. 

S  271.  Mortgage  is  an  Alteration  of  Ownership  and  Change 
of  Interest.  —  But  a  mortgage  is  an  "  alteration  of  ownership  " 
within  the  meaning  of  a  policy  which  inhibits  an  alteration 
of  ownership  upon  penalty  of  forfeiture. ^  And  so  it  is  a 
violation  of  a  provision  against  a  sale  or  alienation  "in 
whole  or  in  part."  And,  indeed,  any  disposition  of  the 
subject-matter  of  insurance,  such  that  any  property  therein 
passes  to  another,  amounts  to  an  alienation  of  the  property 
in  part.  3  And  where  the  insured  sells  the  insured  property, 
receives  pay  in  part,  and  retains  a  lien  for  a  portion  of  the 
purchase-money,  it  is  a  "change  of  interest"  which  avoids 
the  policy.* 

§  272.  Conditional  Sale  no  Alienation ;  Absolute  Deed  in- 
tended as  Security;  Lease.  —  A  conditional  sale  is,  however, 
no  alienation;  as  where  the  assured  executed  a  warranty 
deed  of  the  premises,  and  at  the  same  time  received  back 
from  the  grantee  a  deed  of  the  same  premises,  with  a  condi- 
tion that  if  he  should  pay  to  the  assured  a  specified  sum 
within  a  limited  time,  meanwhile,  and  until  that  sum  should 
be  paid  the  assured  to  retain  possession  of  the  premises,  and, 
upon  payment,  the  second  deed  to  be  void,  but  otherwise  in 
force;  and  it  appeared  the  grantee  in  the  first  deed  never 
paid  or  agreed  to  pay  the  sum  mentioned,  and  it  was  entirely 
optional  with  him  whether  to  do  so  or  not.  The  two  deeds, 
being  executed  at  the  same  time,  are  to  be  regarded  as  one 
contract,  and  were  in  effect  the  same  as  if  the  condition  had 
been  inserted  in  the  first  deed.^  Nor  will  a  sale,  absolute 
in  form,  if  intended  as  security  for  a  debt,  nor  any  convey- 
ance which  a  court  of  equity  will  treat  as  a  mortgage,  be 

1  3  Keyes  (N.  Y. ),  87. 

2  Edmands  v.  Mut.  Safety  Fire  Ins.  Co.,  1  Allen  (Mass.),  311. 

3  Abbott  V.  Hampden  Mut.  Fire  Ins.  Co.,  30  Me.  414. 

*  Bates  V.  Com.,  &c.  Ins.  Co.,  2  Cincinnati  Superior  Ct.  Eeptr.  195  ;  O'Neil  v. 
Ottawa  Agr.  Ins.  Co.,  U.  C.  (C,  P.)  15  Can.  L.  J.  207. 
6  Tittemore  v.  Vei-mont  Mut.  Fire  Ins.  Co.,  20  Vt.  546. 

554 


CH.  XII.]  ALIENATION.  [§  272 

deemed  an  alienation,  whether  there  be  any  agreement  in 
writing  to  that  effect  or  not.^  And  a  sale,  with  an  agree- 
ment for  resale,  intended  as  a  security,  is  no  "transfer  or 
termination  of  interest.  "2  Nor  is  a  sale  of  anything  less 
than  the  whole  interest. ^  Proceedings  "had,  commenced, 
or  taken  "  for  a  sale  refer  to  proceedings  taken  by  the  in- 
sured, and  not  to  proceedings  under  a  foreclosure  of  a  mort- 
oao-e.*  Nor  is  an  assignment  as  collateral  security.^  Nor  is 
a  conveyance  by  the  insured,  with  a  simultaneous  reconvey- 
ance to  be  held  in  trust  for  him.^  Nor  is  a  lease.'  And 
when   the    policy  stipulates    against   a    "sale,    transfer,    or 

1  Hodges  V.  Tenn.  Mar.  &  Fire  lus.  Co.,  4  Seld.  (N.  Y.)  416.  [A  policy  is  not 
avoided  by  a  deed  intended  only  to  secure  a  loan.  Insurance  Co.  v.  Gordon,  68 
Tex.  144;  Barry  v.  H.  B.  Fire  Ins.  Co.,  110  N.  Y.  1.  Where  the  intent  and 
effect  of  a  conveyance,  though  absolute  in  form,  is  really  only  security  for  debt, 
or  the  performance  of  some  condition,  there  is  no  "  sale."  In  this  case  the  in- 
sured, I.,  conveyed  to  A.  by  deed  absolute,  A.  executing  a  bond  to  reconvey  ou 
performance  by  I.  of  a  condition  named.  The  bond  was  not  recorded  and  the 
company  did  not  know  of  it.  Subsequently,  A.,  with  the  knowledge  of  I.  and 
for  his  benefit,  mortgaged  the  property  to  C.  After  the  loss  by  tire,  tlie  mort- 
gage was  discharged  and  X.  reconveyed  to  I.,  and  it  was  held  that  the  property 
had  not  been  "sold."  Bryan  u.  Traders'  Ins.  Co.,  145  Mass.  389.  In  Maine, 
however,  the  defeasance  must  be  recorded.  A.  mortgaged  his  insured  premises 
to  B.  and  released  his  equity  of  redemption  to  C,  taking  back  a  bond  of  defeas- 
ance not  recorded.  This  was  held  an  alienation  avoiding  the  policy.  Tomlin- 
6on  V.  Monmouth  Mut.  Fire  Ins.  Co.,  47  Me.  232,  237.  By  the  expiess  words 
of  the  statute,  a  deed  is  not  defeated  unless  the  defeasance  is  recorded,  the  vendee 
of  the  equity  had  the  record  title,  and  might  have  conveyed  a  good  title,  or 
the  land  couLl  have  been  attached  as  his  property.  In  a  court  of  law  a  deed 
absolute  in  itself  will  avoid  the  policy,  as  a  change  of  title,  although  there  may 
be  an  oral  or  written  defeasance  dehors  the  deed.  The  title  passes  by  the  deed 
to  the  grantee,  although  he  may  be  equitably  bound  to  use  it  for  the  benefit  of 
the  grantor,  beyond  the  amount  of  the  debt.  "Oral  evidence  is  not  admissible 
in  a  court  of  law  to  show  that  a  deed  absolute  on  its  face  was  intended  as  a 
mortgage."  Barry  v.  Hamburg-Bremen  Fire  Ins.  Co.,  53  N.  Y.  Super.  249,  253  ; 
Webb  V.  Rice,  1  Hill,  606.] 

2  Holbrook  v.  Am.  Ins.  Co.,  1  Curtis  (U.  S.  C.  C),  193. 

3  Hitchcock  V.  Northwestern  Ins.  Co.,  26  N.  Y.  68.  See  also  Savage  v.  Long 
Island  Ins.  Co.,  43  How.  Pr.  (N.  Y.)  462. 

*  Michigan  St.  Ins.  Co.  v.  Lewis,  30  Mich.  41.  See  also  Strong  v.  ilanufac- 
turers'  Co.,  10  Pick,  (Mass.)  40. 

s  Ayres  v.  Hartford  Ins.  Co.,  21  Iowa,  193,  198  ;  Ayres  v.  Home  Ins.  Co.,  id. 

185. 

6  Morrison  v.  Tenn.  Mar.  &  Fire  Ins.  Co.,  18  Mo.  (3  Bennett)  262. 

7  Lane  v.  Maine  Fire  Ins.  Co.,  3  Fairf.  (Me.)  44  ;  West  Branch  Ins.  Co.  v. 
Helfenstein,  40  Pa.  St.  289  ;  Hobson  v.  Wellington  Dist.  Ins.  Co.,  6  U.  C.  (Q.  B.) 
536. 

555 


§  273]  INSURANCE :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  XII. 

change  of  title,"  a  mere  agreement  between  the  owner  of 
personal  property  insured  and  another  person,  to  represent 
to  the  creditors  of  the  owner,  in  order  to  prevent  attach- 
ment, that  it  had  been  sold  to  such  other  person,  amounts 
to  neither;  although,  doubtless,  something  less  than  an 
alienation  — as,  for  instance,  a  mortgage,  or  a  conveyance 
of  a  portion  of  the  interest  of  the  insured,  or  one  invalid  as 
against  creditors  —  would  be  a  violation  of  the  stipulation.  ^ 

§  273.  Transfer  or  Change  of  Title;  Interest.  —  As  the  ob- 
ject of  providing  against  a  transfer  or  change  of  title  is  to 
guard  against  a  diminution  in  the  strength  of  the  motive 
which  the  insured  may  have  to  be  vigilant  in  the  care  of  his 
property,  the  substantial  diminution  of  interest  in  the  prop- 
erty insured  has  been  suggested  as  a  test  of  the  kind  of 
transfer  or  change  of  title  which  will  avoid  the  policy.  ^  A 
voluntary  conveyance,  however,  is  a  change  of  title  ;2  and 
so  is  a  conveyance  by  husband  and  wife,  with  a  simultane- 
ous reconveyance  to  the  wife,  to  carry  out  the  provisions  of 
a  will,  devising  the  property  to  the  wife.*  [The  conveyance 
of  a  homestead  by  a  husband  to  his  wife  is  fatal  as  a  change 
of  title. ^  Where  a  barn  belonging  to  W.  is  insured  to  W. 
and  his  wife,  and  afterward  conveyed  by  W.  to  G.  and  the 
same  day  over  to  W. 's  wife,  the  policy  was  held  avoided.^ 
But  where  A.  transferred  the  property  to  B.  and  the  latter 
reconveyed  at  once  to  A.  's  wife,  it  was  held  that  as  A.  had 

1  Orrell  v.  Hampden  Fire  Ins.  Co.,  13  Gray  (Mass.),  431. 

2  Thns,  in  Ayres  v.  Hartford  Fire  Insurance  Company,  17  Iowa,  176,  the 
court  in  discussing  what  transfer  or  change  of  title  would  avoid  the  policy,  held 
the  following  language  :  "  The  object  of  the  insurance  company  by  this  clause  is, 
that  the  interest  shall  not  change  so  that  the  assured  shall  have  a'greater  tempta- 
tion or  motive  to  burn  the  property,  or  less  interest  or  watchfulness  in  guarding 
and  preserving  it  from  destruction  by  fire.  Any  change  in  or  transfer  of  the 
interest  of  the  insured  in  the  property,  of  a  nature  calculated  to  have  this  effect, 
is  in  violation  of  the  policy.  But  if  the  real  ownership  remains  the  same,  —  if 
there  is  no  change  in  the  fad  oi  title,  but  only  in  the  evidence  of  it,  and  if  this 
latter  change  is  merely  nominal,  and  not  of  a  nature  calculated  to  increase  the 
motive  to  burn,  or  diminish  the  motive  to  guard  the  property  from  loss  by  fire,  — 
the  policy  is  not  violated." 

3  Baldwin  v.  Phoenix  Ins.  Co.  (N.  H.),  10  Ins.  L.  J.  32. 

*  Langdon  v.  Minnesota  Mut.  Ins.  Co.,  22  Minn.   193  ;  a7ite,  §  264. 
6  [Milwaukee  Mechanic's  Ins.  Co.  v.  Ketterlin,  24  Brad.  188.] 
6  [Walton  V.  Agricultural  Ins.  Co.,  116  N.  Y.  317.] 

556 


CH.  XII.]  ALIENATION.  [§  273 

an  insurable  interest  at  issue  and  at  loss  (by  virtue  of  the 
curtesy  initiate),  the  policy  was  not  affected  by  the  trans- 
fer. ^  A.  owned  certain  land  which  was  sold  for  taxes,  and 
the  purchaser  conveyed  the  tax  title  to  A. 's  wife.  A.  in- 
sured the  buildings  on  the  land.  Then  the  wife  conveyed 
to  C.  the  tax  title,  A.  joining  and  releasing  his  curtesy.  C. 
immediately  conveyed  the  whole  title  to  A.  As  A. 's  cur- 
tesy was  a  sufficient  interest  to  sustain  his  policy,  and  as 
the  subsequent  conveyances  were  simply  for  the  purpose  of 
completing  title  in  him,  it  was  held  that  the  policy  was  good 
and  that  there  was  no  breach  of  the  condition  against  sale. 
"The  seisin  of  the  third  person  was  instantaneous  only,  and 
he  was  a  mere  conduit  through  whom  the  full  title  was  to  be 
passed  to  the  plaintiff.  To  hold  the  conveyance  by  the  wife, 
her  husband  joining  in  it,  to  be  a  sale  within  the  clause  of 
the  policy,  would  be  to  construe  it  too  strictly,  and  to  at- 
tribute to  it  a  meaning  which  it  was  not  intended  to  bear.  "2 
The  truth  is  simply  that  the  reason  for  the  condition  against 
sale,  viz.  to  prevent  separation  of  the  interests  in  the  policy 
and  in  the  property  so  tempting  to  its  destruction,  does  not 
apply  to  this  case.]  So  is  a  conveyance  in  fee  with  a  mort- 
gage back,3  and  the  conveyance  of  an  equity  of  redemption.* 
And  if  there  be  a  substantial  diminution  of  interest,  though 
it  might  amount  to  a  sale,^  or  change  of  interest,^  yet  it 
would  not  amount  to  a  "transfer  or  termination  of  the  in- 
terest "  of  the  insured,  not  being  a  transfer  of  the  whole 
interest,'^  nor  to  a  "  change  of  title. "  ^  But  a  mortgagee's  in- 
terest is  changed  to  an  absolute  one  by  a  foreclosure,  and  is 
"a  change  in  title  or  possession  "  which  prevents  recovery.^ 

1  [Caldwell  v.  Stadacona  Fire  &  Life  Ins.  Co.,  11  Can.  Supr.  Ct.  212.] 

2  [Kyte  V.  Commercial  Union  Assurance  Co.,  144  Mass.  45.] 

3  Savage  v.  Howard  Ins.  Co.,  52  N.  Y.  502. 

*  Little  V.  Eureka  Ins.  Co.  (Cin.  Supr.  Ct.),  5  Ins.  L.  J.  154. 
''  Savage  v.  Howard  Ins.  Co.,  s^ipra. 

6  Bates  V.  Buckeye  Ins.  Co.  (Cin.  Supr.  Ct.),  4  Ins.  L.  J.  716. 

7  Hitchcock  V.  Northwestern  Ins.  Co.,   26  N.  Y.  68. 

8  Kitts  V.  Massasoit  Ins.  Co.,  56  Barb.  (N.  Y.)  177.  See  also  Phelps  v.  Geb- 
hard  Ins.  Co.,  9  Bosw.  (X.  Y.)  404. 

9  Gaskin  v.  Phoenix  Ins.  Co.,  6  Allen  (N.  B.),  429.  See  also  post,  §  294.  [A 
foreclosure  sale  under  a  valid  moitgage  operates  as  a  change  of  title.  Com. 
Union  Ass.  Co.  v.  Scammon,  102  111.  46.J 

557 


§  274]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,    ETC.         [CH.  XII. 

[§  273  A.  Change  of  Possession.  —  A  change  of  tenants,  or 
occupancy  of  the  house  by  the  owner  is  not  a  "change  of 
title  or  possession."  That  clause  refers  to  the  right  oi  pos- 
session, not  the  occupancy.  1  (a)  When  the  assured  had  made 
an  oral  executory  contract  to  lease  the  insured  premises,  but 
the  intended  lessee  had  only  entered  by  virtue  of  a  parol 
license  to  make  repairs,  the  clause  in  the  policy  prohibiting 
a  change  of  title  or  possession  was  held  not  violated. 2] 

§  274.  Alienation  ;  Levy  of  Execution.  —  A  mere  technical 
levy  upon  real  estate  or  personal  property,  unaccompanied 
by  change  of  possession  or  increase  of  risk,  is  not  within  the 
meaning  of  a  policy  which  provides  that  insurance  shall 
cease  "  if  the  property  be  levied  upon  or  taken  into  posses- 
sion or  custody."  The  words  "levied  upon  "  are  to  be  taken 
with  what  follows  as  explanatory.^  Nor  is  a  wrongful  levy, 
or  one  based  on  an  illegal  assessment;^  nor  a  levy  which 
does  not  devest  the  title.  ^  A  seizure  of  the  goods  insured, 
though  taken  into  the  actual  possession  of  the  sheriff,  is  not 
an  alienation,  if  there  is  no  removal.  The  general  property 
in  goods  seized  on  execution  remains  in  the  debtor  till  they 
are  sold.  The  right  of  the  sheriff  by  virtue  of  the  seizure  is 
defeasible,  it  being  his  duty  to  release  and  restore  the  goods 
to  the   defendant  in  the   execution,   upon  a  tender  of  the 

1  [Pool  V.  Hudson  Ins.  Co.,  2  Fed.  Rep.  432,  1880  ;  1st  Cir.  (N.  H.)  9  Ins.  L. 
J.  428  ;  Eumsey  v.  Phoenix  Ins.  Co.,  1  Fed.  Rep.  396;  17  Blatch.  527,  2d  Cir. 
N.  Y.  1880.] 

2  [Alkan  v.  New  Hampshire  Ins.  Co.,  53  Wis.  136,  148.] 

3  Commonwealth  Ins.  Co.  v.  Berger,  42  Pa.  St.  285  ;  Smith  v.  Farmers',  &c. 
Ins.  Co.,  89  Pa.  287. 

*  Philadelphia  Ins.  Co.  v.  Mills,  44  Pa.  St.  241  ;  Miami,  &c.  Ins.  Co.  v.  Stan- 
hope, Ham.  Co.  Dist.  Ct.  (Ohio),  10  Ins.  L.  J.  159  ;  Ranker  v.  Citizens'  Ins.  Co., 
C.  Ct.  (Ohio),  6  Fed.  Rep.  143. 

^  Pennebaker  v.  Tomlinson,  1  Tenn.  Ch.  598. 

(a)  Such  clause  does  not  apply  to  a  416.  A  leasehold  is  an  insurable  inter- 
surrender  by  the  insured  tenant  to  his  est.  Phila.  Tool  Co.  v.  British- American 
landlord,  if  the  insured's  agent  informs  Ass.  Co.,  132  Penn.  St.  236.  As  to 
the  latter,  who  notifies  him,  that  the  disclosing  that  the  buildings  are  on 
policy  need  not  be  changed.  West  leased  land,  see  Ins.  Co.  v.  Nat'l  Bank, 
Coast  Lumber  Co.  v.  State  Inv.  &  Ins.  88  Tenn.  369 ;  West  Coast  Lumber  Co. 
Co.,  98  Cal.  502.  See  Smith  v.  Phrenix  v.  State  luv.  &  Ins.  Co.,  supra. 
Ins.  Co.,  91  Cal.  323  ;  21  Ins.  L.  J.  137, 
558 


CH.  XII.]  ALIENATION.  [§  275 

amount  due.^  The  same  is  true  of  a  seizure  of  an  equity  of 
redemption  of  real  estate ;  for  after  a  sale  of  the  equity  there 
is  still  left  a  right  to  redeem,  —  a  right  which  may  consti- 
tute a  valuable  interest.  So,  at  least,  will  the  law  presume, 
in  the  absence  of  evidence  to  the  contrary.^  («)  A  sale  in 
execution  is  an  "  incumbrance  by  a  sale  "  while  an  equity  of 
redemption  remains.  When  the  equity  is  gone,  such  a  sale 
becomes  an  alienation.^  [A  sale  of  real  estate  upon  execu- 
tion is  not  a  "levy."  That  word  only  applies  to  personal 
property.4(5)] 

§  275.  Change  of  Title ;  Increase  of  Interest,  —  It  seems 
hardly  necessary  to  say  that  any  change  of  title  whereby  the 
interest  of  the  insured  becomes  enhanced,  and  his  incentives 
to  vigilance  increased,  as  would  be  the  case  where  a  title 
becomes  absolute  in  the  mortgagee  by  foreclosure,  or  a  ten- 

1  Rice  V.  Tower,  1  Gray  (Mass.),  426,  427.  In  this  case  Metcalf,  J.,  said  : 
"  There  are  obite7-  dicta  in  the  books,  that  by  a  seizure  on  a  Jl.  fa.  the  debtor's 
property  in  the  goods  is  lost ;  that  the  sheriff  acquires  a  special  property,  but 
that  the  general  property  of  the  debtor  is  devested  and  is  in  abeyance.  But  the 
law  ^never  was  so."  Referring  to  1  Lev.  282  ;  1  Vent.  53  ;  6  Mod.  293  ;  Holt, 
647  ;  4  Mass.  403;  2  Mass.  517.  See  also  May  v.  Standard  Ins.  Co.,  U.  C.  (Ct. 
of  App.  ,  16  Canada  L.  J.  271,  reversing  s.c.  in  30  U.  C,  (C.  P.)  656.  See  also 
ante,  §  249  ;  Franklin  Fire  Ins.  Co.  v.  Finlay,  6  Whart.  (Pa.)  483. 

2  Strong  V.  Manufacturers' Ins.  Co.,  10  Pick.  (Mass.)  40,44-  Clarke.  New 
England  Mut.  Ins.  Co.,  6  Cush.  (Mass.)  342. 

3  Campbell  v.  Hamilton  Mut.  Ins.  Co.,  51  Me.  69. 

*  [Hammel  v.  Queen's  Ins.  Co.,  54  Wis.  72,  85  ;  Sliafer  v.  Phoenix  Ins.  Co., 
53  Wis.  361,  369.] 

(a)  See  Collins  v.  London  Ass.  Corp.,  79  ;  Browne  Nat.  Bank  v.  Southern  Ins. 
165  Penn.  St.  298  ;  Walradt  v.  Phrenix  Co.  (Wash.),  60  Pac.  1123.  An  actual 
Ins.  Co.,  136  N.  Y.  375.  attachment  by  a  duly  authorized  officer 
(6)  Where,  as  in  New  York,  the  is,  however,  treated  as  a  change  of  pos- 
effect  of  a  sale  of  real  estate  is  declared  session  under  "legal  process."  Carey 
by  statute,  the  judgment  debtor  being  v.  German-American  Ins.  Co.,  84  Wis. 
there  allowed  fifteen  months  to  redeem,  80 ;  Lane  v.  Maine  Mut.  F,  Ins.  Co., 
and  meantime  being  entitled  to  the  28  Am.  Dec.  150,  158,  note.  In  gen- 
possession  and  use,  or  the  rents  and  eral,  any  sale  or  alienation  in  invitum 
profits,  a  mere  sale  on  execution  is  not  does  not  avoid  when  it  is  not  valid  as 
such  a  change  of  title  or  possession  as  against  the  insured  ;  this  applies  to  a 
avoids  a  fire  policy.  Wood  v.  American  voidable  sale  which,  if  not  ratified  by 
F.  Ins.  Co.,  149  N.  Y.  382  ;  Walradt  v.  the  insured,  will  not  defeat  or  delay  re- 
Phcenix  Ins.  Co.,  136  N.  Y.  375.  See  covery  upon  the  policy  for  a  loss  ac- 
Horton  v.  Va.  L.  Ins.  Co.,  122  N.  C.  498  ;  cruing  before  the  sale  is  set  aside. 
Hanover  F.  Ins.  Co.  v.  Brown,  77  Md.  Niagara  F.  Jus.  Co.  v.  Scammon,  144 
64 ;  Merchants'  Ins.  Co.  v.  Brown,  id.  111.  490. 

559 


§  276]  INSURANCE  :  FIRE,  LIFE,   ACCIDENT,   ETC.  [CH.  XII. 

ant  for  years  or  for  life  purchases  the  fee,  -  in  other  words, 
a  sale  or  conveyance  to  the  assured,  —  though  within  the 
words  of  the  proviso  against  sale  or  transfer,  is  not  within 
its  spirit  and  purpose,  and  will  not  vitiate  the  policy.  ^  (a) 

§  276.  Alienation  by  Mortgagor  after  Assignment  of  Policy. 
—  Though  it  be  stipulated  that  the  policy  shall  be  void  by 
alienation,  this  must  be  held  to  mean  alienation  by  the  party 
insured.  If  the  original  insured,  by  the  consent  of  the  in 
surers,  assigns  the  policy,  and  the  assignees  agree  with  the 
insurers  to  pay  all  assessments  which  shall  thereafter  be 
made  upon  the  policy,  and  that  the  property  insured  shall 
remain  subject  to  the  same  lien  as  before,  the  legal  effect  of 
the  transaction  is  to  create  a  new,  substantive,  and  distinct 
contract  with  the  assignees.  It  is  substantially  the  same  as  if 
the  policy  had  been  issued  to  them.  An  alienation,  therefore, 
by  a  mortgagor  of  his  equity  of  redemption,  after  an  assign- 
ment of  the  policy,  under  the  circumstances  just  stated,  is  not 
an  alienation  by  the  assured,  but  rather  by  a  stranger  over 
whom  the  assignees  have  no  control,  and  for  whose  acts  they 
are  not  at  all  responsible,  and  does  not  avoid  the  policy.^  (b) 

1  Bragg  V.  New  England  Mut.  Fire  Ins.  Co.,  5  Fost.  (N.  H.)  289  ;  Heaton  v. 
Manhattan  Fire  Ins.  Co.,  7  R.  I.  502  ;  [Bailey  v.  American  Cent.  Ins.  Co.,  13 
Fed.  Rep.  250  ;  8tli  Cir.  (Iowa),  1882.] 

3  Foster  et  al.  v.  Equitable  Mut.  Fire  Ins.  Co.,  2  Gray  (Mass. ),  216  ;  Bragg  v. 
New  England  Mut.  Fire  Ins.  Co.,  5  Fost.  (N.  H.)  289  ;  Boynton  v.  Clinton  & 
Essex  Mut.  Ins.  Co.,  16  Barb.  (N.  Y.)  254.  And  see  also  Fogg  v.  Middlesex 
Mut.  Fire  Ins.  Co.,  10  Cash.  (Mass)  337  ;  Francis  v.  Butler  Mut.  Fire  Ins.  Co., 
r  R.  I.  159. 

(a)  A  change  of  title  by  which  con-  Boiler  Insp.  Co.  v.  La.sher  Stocking  Co., 
tingent  interests  become  absolute,  or  66  Vt.  439  ;  Collins  iJ.  Merchants' Mut. 
which  increases  the  insured's  interest  Ins.  Co.,  95  Iowa,  540  ;  Koshland  v. 
from  a  lien-holder  to  absolute  ownei'-  Hartford  F.  Ins.  Co.,  31  Oregon,  402. 
ship,  is  not  such  a  change  of  ownership  The  violation  of  a  by-law  of  a  mutual 
as  requires  notice  to  the  insurer  an-  company,  which  forbids  transfer  by 
der  a  moi'tgage-subrogation  agreement,  mortgage,  is  fatal  to  a  recovery  on  the 
Dodge  V.  Hamburg- Bremen  F.  Ins.  Co.,  policy.  Pfister  v.  Gerwig,  122  Ind.  567. 
4  Kaus.  App.  415  ;  Continental  Ins.  Under  the  New  Hampshire  statute,  the 
Co.  V.   Ward,  50  Kansas,  346.  assured's  error,  such  as  the  omission  to 

(b)  If  the  policy  does  not  stipulate  have  an  existing  mortgage  noted  in  the 
against  incumbrances,  or  if  it  requires  application  and  policy,  if  occasioned  by 
disclosure  of  incumbrances,  mortgages  an  innocent  mistake,  does  not  avoid  the 
upon  the  property  made  after  the  insur-  policy.  Perry  v.  Dwelling-House  Ins. 
ance  do  not  affect  it.     Hartf-ard  Steam  Co.,  67  N.  H.  291. 

560 


CH.  XII.]  ALIENATION.  [§  276  B 

[§  276  A.  Fatal  Cases.  —  Insolvency  does  not  excuse  the 
effort  to  obtain  consent  to  a  change  of  interest.  ^  (a)  If  part- 
nership property  is  put  into  the  hands  of  a  receiver  before 
loss,  the  transfer  is  an  alienation  that  avoids  the  policy. 
The  same  is  true  of  an  assignment  in  bankruptcy. ^  When 
the  policy  is  to  be  void,  if  the  assured  shall  dispose  of  all 
his  interest  in  the  property,  and  he  makes  a  sale  of  it  on 
credit,  his  equitable  lien  for  the  purchase-money  will  not 
keep  the  policy  alive. ^  A  policy  with  the  customary  clause 
against  alienation  was  avoided,  when  the  assured  sold  the 
premises  to  a  third  party,  and  took  a  mortgage  for  the  price, 
although  the  mortgagee  was  to  retain  possession  until  the 
price  was  paid.*  A  deed  absolute,  a  part  consideration  for 
which  is  a  return  deed  covenanting  to  permit  the  insured  to 
occupy  the  premises  during  his  life,  is  a  breach  of  the  con- 
dition against  transfer  or  change  of  title. ^  A  sale  by  the 
heirs  of  the  assured  to  a  mortgagee,  with  no  mention  of  the 
mortgage,  avoids  a  policy  on  the  property.^] 

[§  276  B.  Cases  not  Fatal.  —  The  execution  of  a  trust-deed 
is  not  a  transfer  or  change  of  title  that  will  avoid  a  policy." 
If  A.  gives  a  trust-deed  on  his  property  to  secure  a  debt,  and 
then  insures,  a  sale  by  the  trustee  to  himself  or  to  me,  for 
his  benefit,  under  a  power  in  the  trust-deed,  will  not  avoid 
the  policy.  The  sale  will  be  set  aside. ^  A  sale  by  a  school 
committee  of  a  school-house,  on  credit,  they  being  unauthor- 
ized so  to  sell,  and  the  act  not  being  ratified,  does  not  pass  the 
title  thereto,  and  a  renewal  of  a  policy  during  the  controversy 
is  binding,  there  being  a  good  title  in  the  original  owners.^ 

1  [Hine  v.  Woolworth,  93  ¥.  Y.  75.] 

2  [Keeney  v.  Home  Ins.  Co.,  3  T.  &  C.  478,  482.] 

3  [Cal.  State  Bank  v.  Hamburg-Bremen  Ins.  Co.,  71  Cal.  11.] 
i  [Tittemore  v.  Vt.  Mut.  Fire  Ins.  Co.,  20  Vt.  546,  550.] 

5  [Farmers'  Ins.  Co.  v.  Archer,  36  Ohio  St.  608.] 

6  [Dailey  v.  Westchester  Fire  Ins.  Co.,  131  Mass.  173,  174.] 

7  [Nease  v.  iEtna  Ins.  Co.,  18  Ins.  L.  J.  541,  (W.  Va.)  March,  1889.] 

8  [Cora.  Union  Ass.  Co.  v.  Scaramon,  126  111.  355.] 

9  [School  Dist.  in  Dresden  v.  vEtna  Ins.  Co.,  62  Me.  330,  339.] 

(a)   See   McElroy  v.   John  Hancock    In  re  Equitable  Reserve  Fund  L.  Ass'n, 
Mut.  L.  Ins.  Co.,  88  Md.   137  ;  Brown     131  N.  Y.  354. 
V.  Cotton,  &e.  Ins.  Co.,  156  Mass.  587  ; 

VOL.  I.  — 36  561 


§  276  C]        INSURANCE  :    FIRE,   LIFE,  ACCIDENT,   ETC.        [CH.  XII. 

On  April  16,  a  ship  received  fatal  injuries,  but  by  great 
exertion  was  kept  afloat  until  Miy  5,  when  she  was  aban- 
doned and  went  down.  On  April  24,  one-quarter  interest 
was  sold.  It  was  held  that  the  company  was  liable  for 
the  whole  loss,  as  the  fatal  injury  occurred  before  the  sale, 
and  so  in  legal  construction  the  loss  also.^  When  a  policy 
provides  that  it  shall  be  void  if  the  property  is  sold  or 
conveyed,  it  is  not  avoided  by  the  sale  of  a  part  interest 
in  the  premises.  The  policy  still  covers  the  interest  re- 
maining in  the  assured. ^  Sale  of  the  land  under  the  in- 
sured buildings,  reserving  them,  is  not  fatal  to  the  policy.^ 
A  mere  agreement  between  the  assured  and  a  third  party  to 
call  the  insured  property  sold,  to  prevent  creditors  from 
attaching,  is  not  an  alienation  sufficient  to  avoid  the  policy.* 
Giving  a  lease  with  the  privilege  of  purchase  at  a  price 
named,  is  not  an  alienation.^] 

[§  276  C.  Foreclosure.  —  Where  a  fire  occurs  on  the  very 
day  of  a  foreclosure  sale,  but  before  it  the  loss  occurs  before 
alienation.^  When  mortgaged  property  is  insured  pending 
foreclosure  proceedings,  for  the  benefit  of  the  mortgagee  and 
his  assigns,  the  company  cannot  defend  on  the  ground  of 
change  of  ownership  by  the  foreclosure  sale."  A  sale  on 
foreclosure,  no  deed  having  been  executed  or  report  of  sale 
made,  does  not  violate  the  condition  against  transfer.^  And 
the  deed  must  not  only  be  made  but  delivered.^  When  the 
policy  is  to  be  void  for  selling  or  transferring  or  making  a 
change  in  the  title  or  possession,  it  is  held  that  neither  a 
mortgage  nor  foreclosure  proceedings  before  the  equity  of 
redemption  has  expired  avoid  it.i^(a)     But  if  property  on 

1  [Duncan  v.  Great  Western  Ins.  Co.,  3  Keyes  (N.  Y.),  394,  396.] 

2  [Scanlon  v.  Union  Fire  Ins.  Co.,  4  Biss.  511,  512.] 

3  [Washington  Mills  Emery  Manuf.  Co.  i-.  Commercial  Fire  Ins.,  12  Ins.  L.  J. 
181  ;  1st  Cir.  (Mass.)  1883.] 

*  [Orrell  v.  Hampden  Fire  Ins.  Co.,  13  Gray,  431,  434.] 

5  [Planters'  Mut.  Ins.  Co.  v.  Rowland,  66  Md.  236.] 

6  [Pearman  v.  Gould,  42  N.  J.  Eq.  4.] 

^  [German  Ins.  Co.  v.  Churchill,  26  Brad.  206.] 

8  [Haighti'.  Continental  Ins.  Co.,  92  N.  Y.  51.] 

9  [Marts  I'.  Cumberland  Ins.  Co.,  44  N.  J.  478.] 

1"  [Loy  V.  Home  Ins.  Co.,  24  Minn.  315,  318.     See  §§  269-269 a.] 

(a)    See  Brown  v.  Cotton  &  W.  M.  Ins.  Co.,  156  Mass.  587. 
562 


CH.  XII.]  ALIENATION.  [§  277 

which  a  mortgage  has  been  foreclosed  is  insured,  the  policy 
becomes  void  when  the  period  of  redemption  expires,  for  the 
property  is  then  alienated,  and  a  vote  of  the  mortgagee  next 
day  extending  the  time  of  redemption  cannot  save  the  pol- 
icy. It  comes  too  late,  and  it  is  an  agreement  without 
consideration  and  not  binding.  ^  A  decree  for  sale  in  an 
ordinary  foreclosure  suit  is  not  such  "a  judgment  in  fore- 
closure proceedings  "  as  will  avoid  a  policy. ^  To  have  such 
consequences  it  must  be  a  judgment  that  will  of  itself  effect 
an  alienation.  And  the  mere  commencement  of  foreclosure 
proceedings  will  not  affect  the  policy;  the  foreclosure  must 
be  complete  and  valid  (§  269  a  near  the  end).  Such  com- 
mencemerit  is  not  a  "  change  of  ownership  or  increase  of  haz- 
ard." ^  If  however  the  policy  expressly  provides  that  the 
commencement  of  foreclosure  proceedings  shall  avoid  it,  the 
condition  will  be  enforced.*  But  where  an  application  truly 
stated  that  no  foreclosure  proceedings  had  been  begun  and 
the  policy  stipulated  that  the  commencement  of  any  fore- 
closure proceedings  shall  immediately  render  this  policy 
void,  and  no  such  proceedings  were  begun  after  the  policy 
was  issued,  but  there  were  such  begun  between  the  date  of 
the  application  and  the  date  of  the  policy,  it  was  held  that 
the  company  was  bound,  and  the  policy  was  not  forfeited. 
The  insurer  must  stipulate  for  the  intervening  period  if  he 
would  cover  it.^  (a)] 

§  277.    Alienation ;  Entire  Contract.  —  As  a  general  rule,  a 
breach  of  condition,  where  the  contract  is  entire, ^  affects  all 

1  [Essex  Savings  Bank  v.  Meriden  Ins.  Co.,  57  Conn.  33.^).] 

2  [Kane  v.  Hibernia,  38  N.  J.  L.  441,  455.] 

3  [Phcenix  Ins,  Co.  v.  Union  Mut.  Life  Ins.  Co.,  101  Ind.  392.] 
*  [Meadows  v.  Hawkeye  Ins.  Co.,  62  Iowa,  387.] 

8  [f),iy  „.  Hawkeye  Ins.  Co.,  72  Iowa,  597,  599.] 

6  [The  language  used  by  May  in  this  and  the  following  section  might  lead 
one  to  suppose  that  although  the  contract  were  entire  it  might  not  be  avoided 

(a)    See  Breedlove  v.  Norwich  Union  Wash.  175  ;  Same  v.  St.  Paul  F.  &  M. 

F.  Ins.  Co.,  124   Cal.  164  ;  Hanover  F.  Ins.    Co.,    68   Minn.    170  ;    Washlmrn 

Ins.  Co.   V.  Brown,  77  Md.  64  ;  Conti-  Mill  Co.  u.  Phila.  Fire  Ass'n,  60  Jlinn. 

nental   Ins.  Co.  v.   Anderson,  107  Ga,  68;  Bellevue  Roller-Mill  Co.  r.  London 

541  ;  Hartford  F.   Ins.  Co.  v.  Keating,  &  L.   Ins.   Co.   (Idaho),   39    Pac.  196  ; 

86  Md.  130  ;  Pioneer  Sav.  &  L.  Co.  v.  Tierney  v.  Phenix  Ins.  Co.,  4  No.  Dak. 

Frovideuce- Washington    Ins.    Co.,     17  565. 

563 


§  277]  INSUKANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.        [CH.  XII. 

the  property  insured,  though  it  may  be  of  different  kinds 
and  separately  appraised  in  the  policy. ^  If  the  premium  be 
entire,  separate  valuations  upon  separate  parcels  of  property 
have  only  the  effect  to  limit  the  risk  on  each  parcel.  ^  Thus 
the  alienation  of  a  house  vitiates  the  policy  both  as  to  the 
house  and  the  furniture  in  it.^  So,  also,  the  sale  by  a  part- 
ner of  his  undivided  interest  avoids  a  policy  containing  a  pro- 
hibition of  such  sale  as  to  the  interests  of  the  other  partners.* 
Misrepresentation   as   to  the    title  to   a   store,    or    amount 


by  a  breach  as  to  part  of  the  property.  I  have  seen  no  case  which  hohls  this. 
The  question  is  in  every  case  ivhether  the  contract  is  entire.  If  it  is,  a  breach  as  to 
part  breaks  it  all,  if  not  ei>tire,  a  part  may  still  be  good.  The  difficulty  is  to 
arrive  at  a  test  of  entireness.  The  cases  look  to  the  premium,  the  apportion- 
ment of  the  insurance,  and  the  language  of  the  conditions.  There  are  three 
questions  in  such  cases.  (1)  Is  it  possible  to  separate  the  policy?  (2)  If  so, 
have  the  parties  clearly  indicated  an  intent  that  it  should  not  be  separated  ? 
(3)  If  not,  and  separation  is  possible,  is  it  fair  and  just  that  it  should  be  made? 
It  is  not  just  if  there  is  bad  faith  on  the  part  of  the  assured.  One  who  en- 
deavors to  defraud  should  not  be  aided  by  the  law.  But  in  case  of  breach 
without  bad  faith,  division  should  be  made  if  it  can  be  done  without  injustice 
to  the  insurer,  and  in  deciding  this  point  the  test  used  in  a  recent  Indiana  case 
seems  valuable.  The  court  said  that  where  the  property  is  so  situated  that  the 
risk  on  one  specific  item  in  the  policy  aifects  the  others,  the  contract  is  entire, 
but  where  it  does  not  so  affect  the  others  the  contract  is  separable  ;  for  example, 
a  policy  on  a  barn  and  a  house  standing  ajiart  is  separable.  Phenix  Ins,  Co.  v. 
Pickel,  18  Ins.  L.  J.  592  (Ind.).  The  premium  was  entire  in  this  case,  but  the 
insurance  was  apportioned.] 

1  [As  a  rule  a  policy  void  in  part  is  void  in  toto.  McGowan  v.  People's  Mut. 
Fire  Ins.  Co.,  54  Vt.  211.  If  there  is  bad  faith  in  any  way  entering  into  the 
contract,  the  insured  oi;ght  to  lose  the  whole  benefit.  Good  faith  is  a  condition 
distributed  over  the  whole  agreement.  If  however  he  has  acted  in  good  faith  and 
the  policy  is  divisible,  as  where  the  insurance  on  the  different  items  is  separately 
named,  and  the  premium  is  apportioned,  or  is  apportionable  by  plain  mathe- 
matical principles,  as  in  case  of  the  insurance  of  three  hoiises  all  just  alike, 
then  an  avoidance  as  to  one  part  should  not  affect  the  rest.  It  must  be  confessed, 
however,  that  the  authorities  as  a  whole  by  no  means  take  a  view  so  free  of 
technicalities.  In  case  of  a  divisible  policy  where  actual  fraud  is  absent,  a  mis- 
representation will  onl}'  cause  a  forfeiture  in  respect  to  the  pioperty  affected 
by  the  untruth.  Insurance  Co.  of  N.  A.  v.  Hofing,  29  111.  App.  ISO.  A  policy 
insuring  several  detached  buildings  is  not  avoided  as  to  all  by  a  breach  of  warranty 
respecting  some.     Pickel  v.  Phenix  Ins.  Co.,  18  Ins.  L.  J.  598,  (Ind.)  June,  1889.] 

'^  Plath  V.  Minnesota  Farmers'  Ins.  Co.,  23  Minn.  479 ;  [Carver  v.  Hawkeye 
Ins.  Co.,  69  Iowa,  202.] 

3  Barnes  v.  Union  Mut.  Fire  Ins.  Co.,  51  Me.  110.  See  also  aiite,  §  189  ;  [In- 
surance on  a  house  and  its  furniture  is  substantially  one  risk.  Havens  v.  Home 
Ins.  Co.,  Ill  Ind.  90.] 

*  Dix  V.  Mercantile  Ins.  Co.,  22  111.  272. 

564 


CH.  XII.]  ALIENATION.  [§  277 

of  incumbrance  thereon,  or  other  material  fact,  vitiates 
the  insurance  both  upon  the  store  and  the  stock  of  goods 
therein.  1  [A  breach  of  warranty  as  to  some  of  the  property 
covered  by  an  entire  policy  avoids  it  as  to  the  whole,  though 
there  are  several  different  kinds  of  property  insured. ^  When 
a  policy  insured  against  fire  three  adjoining  buildings  for 
-1666.661  on  each  building,  and  when  in  one  house  business 
was  carried  on  which  avoided  the  policy,  and  which  caused 
an  explosion  whereby  all  three  houses  were  injured,  it  was 
held  that  the  contract  was  entire  and  there  could  be  no  re- 
covery,^ although  the  owner  did  not  know  that  the  tenant 
kept  gunpowder  in  the  house.]  Additional  insurance,  with- 
out notice,  on  stock  vitiates  the  policy  both  on  the  stock  and 
fixtures.^  The  appropriation  of  one  of  two  buildings,  both 
included  in  the  policy  and  insured  for  distinct  amounts  to  a 
more  hazardous  use,  vitiates  the  policy  as  well  upon  the  one 
not  so  appropriated  as  upon  the  other. ^  So  false  swearing 
as  to  value  of  goods  lost  vitiates  policy  upon  both  building 

1  Gould  V.  York  County  Mut.  Fire  Ins.  Co.,  47  Me.  403  ;  Lovejoy  v.  Augusta 
Mut.  Fire  Ins.  Co.,  45  id.  472  ;  Friesniuth  v.  Agawam  Mut.  Ins.  Co.,  10  Cush. 
(Mass.)  587  ;  Brown  v.  People's  Mut.  Ins.  Co.,  11  Cush.  280  ;  Richardson  v. 
Maine  Ins.  Co.,  46  Me.  394  ;  Day  v.  Charter  Oak  Fire  Ins.  Co.,  51  id.  91  ; 
Hinman  v.  Hartford  Fire  Ins.  Co.,  36  Wis.  159  ;  Bleakley  v.  Niagara  Dist.  Mut. 
Fire  Ins.  Co.,  16  Grant,  Ch.  (U.  C.)  198  ;  ante,  §  189  ;  post,  §  290  ;  .Etna  Ins. 
Co.  V.  Resh  (Mich.),  9  Ins.  L.  J.  549  ;  Schunilsch  v.  American  Ins.  Co.  (Wis.), 
9  Ins.  L.  J.  56  and  note  ;  Gottsman  v.  Penn.  Ins.  Co.,  56  Pa.  St.  210  ;  Whitwell 
V.  Putnam  Ins.  Co.,  6  Lans.  (N.  Y.)  166.  The  law  in  Canada  seems  to  be  un- 
settled, the  latest  case,  by  a  divided  court,  holding  that,  where  there  are  dis- 
tinct subjects  of  insurance  at  specified  amounts,  misrepresentation  as  to  one 
does  not  prevent  recovery  on  the  other,  although  the  premium  paid  is  but  a 
single  sum  applicable  to  both.  See  wSamo  v.  Gore  Dist.  Mut.  Fire  Ins.  Co.,  1 
Ont.  App.  Rep.  375,  where  the  several  opinions  seem  to  cover  the  whole  field 
of  Canadian  jurisprudence  on  this  point.  This  case  was,  however,  reversed  on 
appeal,  2  Can.  Supr.  Ct.  Rep.  411,  that  court  holding  the  law  to  be  in  accord, 
ance  with  the  doctrine  of  the  text.  See  also  Russ  v.  Mut.  Fire  Ins.  Co.,  29 
U.  C.   (Q.  B.)  73. 

2  [Cuthbertson  v.  Insurance  Co.,  96  N.  C.  480,  487.] 

3  [Fire  Ass.  v.  Williamson,  26  Pa.  St.  196,  198.] 

4  Kimball  v.  Howard  Fire  Ins.  Co.,  8  Gray,  33  ;  Associated  Firemen's  Ins. 
Co.  V.  Assum,  5  Md.  165  ;  Ramsay  et  al.  v.  Mut.  Fire  Ins.  Co.,  11  U.  C.  (Q.  B.) 
516  ;  Bellington  v.  Can.  Mut.  Fire  Ins.  Co.,  39  U  C.  (Q.  B.)  433  ;  Elliott  v.  Ly- 
coming, &c.  Ins.  Co.,  66  Pa.  St.  22.  Otherwise  if  insured  in  two  distinct  policies. 
Franklin,  &c.  Ins.  Co.  v.  Brock,  57  Pa.  St.  74. 

5  Lee  V.  Howard  Fire  Ins.  Co.,  3  Gray  (Mass.),  583;  Fire  Association  of 
Phila.  V.  Williamson,  26  Pa.  St.  196. 

565 


§  278]  INSURANCE :     FIRE,   LIFE,    ACCIDENT,   ETC.        [CH.  XII. 

and  merchandise.  1  [So  where  a  joint  policy  was  taken  out 
on  the  several  interests  of  a  widow  and  her  children,  and 
the  premium  was  not  apportioned,  but  was  paid  as  a  whole 
consideration,  it  was  held  that  if  action  was  barred  by  limi- 
tation or  breach  of  condition  or  attempt  of  one  party  to  de- 
fraud the  company,  the  whole  policy  was  avoided.'^]  And  an 
alienation  by  a  mortgagor  of  part  of  the  premises  upon  which 
he  had  effected  insurance,  after  an  assignment  of  the  policy 
with  the  consent  of  the  insurers  to  the  mortgagee,  who 
signed  the  premium  note,  will  avoid  the  policy  in  toto  as  to 
the  mortgagor's  interest.^  If  the  premium  be  entire,  and 
likewise  the  deposit  note,  and  the  lien  for  the  assessment  on 
the  same  attach  to  all  the  separate  parcels,  the  contract  is 
entire,  and  if  void  at  all  is  void  in  toto,  although  several 
sums  are  designated  as  insured  upon  the  several  parcels. 
But  if  the  several  parcels  are  insured  in  several  sums,  each 
having  its  specific  premium  and  deposit  note,  and  for  which 
a  distinct  lien  can  be  asserted,  then  an  alienation  of  one 
parcel  is  only  an  avoidance  of  the  policy  pro  tantoJ 

§  278.  Alienation  of  one  of  several  Distinct  Parcels  of  Prop- 
erty.  But  the  authorities  are  not  all  agreed  upon  the  point 

that  a  violation  of  a  condition,  or  a  misrepresentation  as  to 
part  of  the  property  insured,  avoids  the  policy  as  to  the 
whole  when  the  contract  is  entire.  [In  a  New  Hampshire 
case  it  was  said,  when  the  assured  alienates  without  the 
company's  consent  one  of  several  parcels  of  real  estate  cov- 
ered by  a  policy  which  stipulated  against  alienation,  the 
policy  is  avoided  as  to  all  unless  the  court  can  say  as  a 
matter  of  law  that  the  risk  is  not  increased.^]  In  Loehner 
V.  Home  Mutual  Fire  Insurance  Company, ^  it  was  held  that 

1  Cushman  v.  Liverpool,  &c.  Ins,  Co.,  5  Allen  (N.  B.),  246.  [Although  the 
policy  insures  the  building  and  its  contents  by  separate  amounts.  Harris  v. 
"Waterloo  Mut.  Fire  Ins.  Co.,  10  Ont.  R.  718,  (so  provided  by  statute).] 

2  [Monaghan  v.  AgrL  Fire  Ins.  Co.,  53  Mich.  238,  252-2.^3.] 

3  Boynton  v.  Clinton  &  Essex  Mot.  Ins.  Co.,  16  Barb.  (N.  Y. )  254. 

4  Friesmuth  v.  Agawam  Mut.  Ins.   Co.,  10  Gush.  (Mass.)  587  ;  ante,  §§  189, 

228. 

5  [Baldwin  v.  Hartford  Fire  Ins.  Co.,  60  N.  H.  422,  424.] 

6  17  Mo.  247  ;  s.  c.  affirmed,  19  Mo.  628.  See  also  Commercial  Ins.  Co.  y. 
Spaukneble,  52  111.  53  ;  Koontz  v.  Hannibal,  &c.  Ins.  Co.,  42  Mo.  126. 

566 


CH.  XII.]  ALIENATION.  [§  278 

a  misrepresentation  as  to  the  title  of  the  house  insured  only 
vitiates  the  policy  as  to  the  house,  and  that  a  recovery  might 
be  had  for  the  loss  of  furniture  insured  in  the  same  policy 
under  a  separate  valuation.     "  With  respect  to  the  furniture 
and  the  piano,"  say  the  court,   "although  they  may  be  re- 
garded as  being  insured  in  the  building  covered  by  the  pol- 
icy, yet,  because  the  statute  arbitrarily  avoids  the  policy  as 
to  the  building  for  want  of  a  disclosure  of  the  fact  which 
did  not  at  all  affect  the  risk,  we  cannot  come  to  the  conclu- 
sion that  the  policy  was  likewise  void  as  to  the  furniture 
and  piano."     And  in  Phoenix  Insurance  Company  v.  Law- 
rence, ^  where  the  interest  of  the  insured  in  a  storehouse  was 
untruly  stated,  it  was  nevertheless  held  that  the  plaintiff 
might  recover  for  the  goods  therein  insured  in  the  same 
policy,  and  upon  a  distinct  and  separate  valuation,  although 
the  premium  paid  was  an  entire  sum.     In  the  last  case,  the 
case  of  Clark  v.  New  England  Mutual  Fire  Insurance  Com- 
pany ^  was  relied  upon,  where  the  court  held   that,   there 
being  separate  and  distinct  insurance  upon  two  buildings, 
alienation  of  one  would  not  avoid  the  policy  as  to  the  other. ^ 
And  a  sale  by  the  insured  of  one  of  several  distinct  parcels 
of  real  estate  covered  by  the  policy,  that  part  forming  a  dis- 
tinct item,  with  separate  and  distinct  valuation,  does  not 
avoid  the  policy  except  pro  tanto ;  as  to  the  property  still 
held  by  the  insured  at  the  time  of  the  loss,  he  is  entitled  to 
recover  according  to  the  terms  of  the  policy.*     Nor  does  the 
assignment  of  part  of  a  mortgage  debt.^     Nor  upon  prin- 
ciple does  it  seem  to  be  of  any  consequence  whether  the  val- 

1  4  Met.  (Ky. )  9. 

2  6  Cush.(Mass.)  342. 

3  The  report  does  not  show  whether  the  premium  was  an  entire  sum  or  not ; 
but  on  reference  to  the  record  it  is  found  that  the  plaintiff  was  insured  for 
$2  500  —  §2,200  on  his  tavera-house  and  $300  on  his  shop,  —for  which  was 
paid  a'  cash  premium  of  $5,  and  a  deposit  note  of  §371  given.  Upon  these 
facts  the  case  is  not  now  law  in  Massachusetts,  though  it  does  not  appear  to 
have  been  overruled  or  even  referred  to  in  the  subsequent  cases.  See  the  pre- 
ceding section. 

*  Clark  V.  New  England  Mut.   Fire  Ins.  Co.,  6  Gush.  (Mass.)  342.     And  see 
also  Bodle  et  al.  v.  Chenango  Mut.  Ins.  Co.,  2  Comst.  (N.  Y.)  53. 
5  Rex  V.  Ins.  Co.,  2  Phila.  (Pa.)  357. 

567 


§  278]  INSURANCE  :    FIRE,   LIFE,    ACCIDENT,   ETC.        [CH.  XII. 

nation  be  separate  and  distinct  or  not.  Surely  a  merchant 
who  insures  his  store  and  stock  in  trade,  or  a  farmer  who 
insures  his  barn  and  contents,  may  recover  for  the  unsold 
balance  of  his  stock,  notwithstanding  he  daily  sells  a  por- 
tion of  it.  The  diminution  of  insurable  interest  coincides 
with  a  diminution  of  the  right  to  claim  for  loss,  and  rela- 
tively there  is  no  change  in  the  situation.  To  say  that  the 
policy  is  thereby  joro  tanto  avoided,  is  not  so  correct  an  ex- 
pression as  to  say  that  the  amount  which  the  insured  would 
have  the  right  to  recover  under  it  \^  pro  tanto  reduced.  ^  Nor 
will  the  result  be  different,  though  it  be  stipulated  that  the 
policy  is  to  be  void  upon  a  sale  of  the  whole  or  any  part  of 
the  property  insured.  Nothing  short  of  a  sale  of  the  whole 
will  deprive  the  insured  of  his  right  to  recover  at  all.  If  he 
sells  a  part,  he  merely  forfeits  the  right  to  claim  for  the  loss 
of  that  part,  and  for  the  simple  and  obvious  reason  that, 
having  sold  it  prior  to  the  fire,  he  did  not,  and  could  not, 
lose  it.  But  if  he  keeps  up  his  stock  he  recovers  to  the  full 
amount. 2  So  where  one  horse  is  exchanged  for  another. ^ 
And  so  it  has  been  held  that  where  a  policy  provides  that 
if  the  property  shall  be  sold  without  consent  of  the  company, 
the  policy  should  be  void,  and  also  provides  that  where  the 
property  is  sold,  the  insurance  on  such  property  shall  termi- 
nate, a  sale  of  part  of  the  property  does  not  avoid  the  policy 
except  as  to  that  part.*  In  some  cases  the  policy  provides 
that  the  insurance  shall  be  void  only  as  to  those  parcels  with 
reference  to  which  the  breach  takes  place. ^  [When  different 
goods  are  specifically  and  severally  insured  in  the  same  pol- 
icy, the  amount  and  value  of  each  being  specified,  the  as- 
sured may  abandon  some  one  kind  in  case  of  loss  and  retain 
the  rest  as  though  they  were  insured  in  separate  policies.® 

1  Lane  v.  Maine  Mut.  Fire  Ins.  Co.,  3  Fairf.  (Me.)  44  ;  Hobbs  et  al.  v.  Mem- 
phis  Ins.  Co.,  1  Sneed  (Tenn.),  444. 

2  Wolfe  V.  Security  Fire  Ins.  Co.,  39  N.  Y.  49  ;  Peoria  Mar,  &  Fire  Ins.  Co. 
V.  Anapow,  51  111.  283. 

»  Mills  V.  Farmers'  Ins.  Co.,  37  Iowa,  400. 
*  Quarrier  v.  Insurance  Co.,  10  W.  Va.  507. 

5  Daniel  v.  Robinson,  Batty  (Irish),  650. 

6  [Diedericks  v.  Com.  Ins.  Co.,  10  Johns.  234,  236.] 

568 


CH.  XII.]  ALIENATION.  [§  279 

Where  two  persons  jointly  insured  a  building  and  it  turned 
out  that  one  of  them  had  no  insurable  interest,  the  other 
could  nevertheless  recover  on  the  policy,  ^j 

§  279.  Alienation  by  one  Joint  Owner  to  another.  —  Much 
discussion  has  been  had  in  the  courts  upon  the  question 
whether  a  sale  by  one  joint  owner  to  another  is  an  aliena- 
tion which  avoids  the  policy ;  but  the  better  opinion  seems 
to  be  that  it  is  not  strictly  speaking  an  alienation,  a  trans- 
fer from  one  to  another,  but  rather  a  shifting  of  interests 
amongst  joint  owners,  without  the  introduction  of  any 
stranger  to  the  number  of  the  insured.  So  far  as  the  con- 
tract is  based  upon  the  personal  qualities  of  the  insured, 
there  is  no  increase  of  risk,  because  no  element  of  improvi- 
dence or  carelessness  is  introduced,  and  the  property  in- 
sured will  still  be  under  the  care  and  management  of  the 
original  parties. ^  But  the  rule  was  held  to  be  otherwise  in 
Dey  V.  Poughkeepsie  Mutual  Insurance  Company,^  if  by  the 

1  [Perry  v.  Mechanics'  Mut.  Ins.  Co.,  11  Fed.  Eep.  478  ;  11  Ins,  L.  J.  409 
1st  Cir.  (R.  I.)  1882.] 

2  Hoffman  v.  Mtna,  Fire  Ins.  Co.,  1  Robt.  (N.  Y.  Superior  Ct.)  501  ;  s.  c.  af- 
firmed, 32  N.  Y.  405  ;  Pierce  v.  Nashua  Fire  Ins.  Co.,  50  N.  H.  297  ;  Burnett  v. 
Eufaula  Home  Ins.  Co.,  46  Ala.  11  ;  Buffalo  Steam  Engine  AVorks  v.  Sun  Mut. 
Ins.  Co.,  17  N.  Y.  401,  412  ;  Tallman  v.  Atlantic  Ins.  Co.,  29  How.  (N.  Y.)  71  ; 
Tillou  V.  Kingston  Mut.  Fire  Ins.  Co.,  7  Barb.  (N.  Y.  Sup.  Ct.)  570  ;  Wilson  v. 
Genessee  County  Mut.  Ins.  Co.,  16  id.  511  ;  West  v.  Citizens'  Ins.  Co.,  27  Ohio 
St.  1  ;  Cowan  i'.  Iowa  St.  Ins.  Co.,  40  Iowa,  551.  See  also  Judge  Bennett's  note 
to  Hobbs  V.  Memphis  Ins.  Co.,  3  Ben.  Fire  Ins.  Cas.  49.  [Sale  or  mortgage  of 
other  transactions  between  partners  relative  to  partnership  property  constitute 
no  violation  of  the  condition  against  transfer  or  change  of  title.  Dresser  v. 
United  Fireman's  Ins.  Co.,  45  Hun,  298  ;  New  Orleans  Ins.  Ass.  v.  Holberg, 
64  Miss.  51  ;  Combs  v.  Shrewsbury  Ins.  Co.,  34  N.  J.  Eq.  403,  412  ;  Texas  Bank- 
ing &  Ins.  Co.  V.  Cohen,  47  Texas,  406,  412  (sale  and  retirement)  ;  Klein  v. 
Union  Fire  Ins.  Co.,  3  Ont.  R.  234.  When  a  policy  prohibits  assignment  it  does 
not  include  the  assignment  of  one  partner  to  the  other.  The  transfer  from 
one  partner  to  another  is  an  occurrence  so  common  in  business  that  the  parties 
are  presumed  to  have  contracted  in  reference  to  it.  If  they  wished  to  exclude  it, 
a  stipulation  to  that  effect  should  have  been  inserted  in  the  policy.  Dermani  v. 
Home  Ins.  Co.  of  N.  Y.,  26  La.  An.  69,  71.  A  sale  alone  or  a  sale  and  mort- 
gage back  between  partners  of  the  partnership  property  is  not  a  breach  of  the 
condition  against  sale,  nor  does  it  as  a  matter  of  law  increase  the  risk.  Part- 
ners are  to  be  regarded  as  so  far  one  person  in  regard  to  partnership  property 
that  dealings  among  themselves  do  not  fall  fairly  within  the  meaning  of  the 
prohibitions  of  the  policy.     Powers  v.  Guardian  Ins.  Co.,  136  Mass.  109.] 

3  23  Barb.  (N.  Y.),  623  ;  [Card  v.  Phoenix  Ins.  Co.,  4  Mo.  Ap.  424,  427. 
If  the  policy  is  to  be  void  in  case  of  transfer  or  change  of  title,  a  dissolution 

569 


§  279]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.        [CH.  XII. 

change  in  the  partnership  a  new  member  is  introduced.  ^  It 
has  also  been  held  that  where  such  a  change  of  property  has 
been  made,  recovery  can  be  had  only  for  the  loss  of  so  much 
as  has  not  been  transferred, — i.e.  the  interests  of  the  re- 
maining parties.2  But  upon  principle  it  seems  to  be  rea- 
sonable that  the  plaintiffs,  being  owners  at  the  time  of  the 
insurance  and  thence  to  the  loss,  should  recover  the  entire 
loss.     And  such  seems  to  be  the  weight  of  authority.  ^  (a) 

of  the  partnership  and  division  of  goods  before  loss,  or  a  transfer  by  one 
partner  to  a  stranger,  is  fatal.  Card  v.  Phoenix  Ins.  Co.,  4  Mo.  App.  427  ;  cit- 
ing Savage  v.  Insurance  Co.,  52  N.  Y.  506  ;  Dreher  v.  Insurance  Co.,  18  Mo. 
128.  The  taking  in  of  a 'partner  bj'  one  who  is  insured  individually  is  such  a 
change  of  title  and  possession  as  avoids  the  policy.  Malley  v.  Atlantic  Ins.  Co., 
51  Conn.  222.  A  change  of  a  stock  of  goods,  selling  and  replacing,  does  not 
avoid  a  policy  ;  but  a  sale  in  mass,  or  a  diminution  of  the  owner's  interest,  or 
the  introduction  of  a  new  member  into  the  firm,  as  in  this  case  is  fatal  :  Biggs  v. 
Insurance  Co.,  88  N.  C.  141,  144  ;  citing  Dey  v.  Poughkeepsie  Mut.  Ins.  Co., 
23  Barb.  623  ;  [and  not  alone  as  to  the  goods  or  interest  sold,  but  the  contract 
being  entire  is  wholly  avoided.  Id.,  &c,  ;  Quarrier  v.  Peabody  Ins.  Co.,  10  W. 
Va.  607.] 

1  [In  Maryland  it  is  held  that  taking  in  a  new  partner  without  notice  to 
the  company  does  not  affect  the  validity  of  a  renewal  made  after  the  change. 
A  renewal  receipt  is  a  new  parol  contract,  and  absence  of  notice  to  the  company 
that  a  new  member  has  come  into  the  firm  since  the  original  insurance,  is  not 
material.  The  new  contract  is  made  with  the  firm  as  constituted  at  the  time  of 
it.     Firemen's  Ins.  Co.  v.  Floss  &  Co.,  67  Md.  404.] 

'■^  Hobbs  V.  Memphis  Ins.  Co.,  1  Sneed  (Tenn.),  444. 
-    3  Hoffman  v.  iEtna  Ins.  Co.,  32  N.  Y.  415  ;  West  v.  Citizens'  Ins.  Co.,  27 
Ohio  St.  1. 

(«)  Agreements  between  co-partners  N.  Y.  195  ;  Koby  v.  American  Central 

as  to  the  firm's  personalty  or  change  of  Ins.    Co.,  120  N.  Y.  510  ;  Hanover  F. 

members  are  now  generally  treated  as  Ins.  Co.  v.  Lewis,  28  Fla.  209  ;  Southern 

not  working  a  material  change  of  title,  Fertilizer  Co.  v.  Reams,  105  N.  C.  283. 

when    the    hazard    is    not    increased.  Partition  is  a  change  of  title  ;  but  a 

Georgia  Home  Ins.  Co.  v.  Hall,  94  Ga.  change   of  ownership  as  to  a  building 

630  ;  Painkle  v.  Hartford  Ins.  Co.,  99  does  not  forfeit  as  to  personalty  therein, 

Iowa,    414  ;    Phenix   Ins.    Co.  v.   Hoi-  when  they  are  separately  insured.    Tra- 

combe,  57  Neb.  622,  629;  Virginia  F.  bue  i-.  Dwelling-House  Ins.  Co.,121  Mo. 

&  M.  Ins.  Co.  V.  Vaughan,  88  Va.  832;  75  ;  Coleman  v.  New  Orleans  Ins.  Co., 

Brigham  v.  Wood,  48  Minn.  344  ;  New  49  Ohio  St.  310  ;  Barnes  v.  Union  Mut. 

Orleans  Ins.  Ass'n  v.  Holberg,  64  Miss.  F.  Ins.  Co.,  51  Maine,  110.     In  general, 

51  ;  Allemania  F.  Ins.  Co.  v.  Peck,  133  consent  to  the  transfer  of  the  policy  is 

111.  220  ;  Blackwell  v.  Ins.  Co.,  48  Ohio  consent  to  a  transfer  of  the   property. 

St.  533.     See  Jones  r.  Phcenix  Ins.  Co.,  Small  v.   Westchester  F.  Ins.  Co.,   51 

97  Iowa,   275  ;   American   Credit  Ind.  Fed.  Rep.  789  ;  see  Brennan  v.  Crouch, 

Co.   V.  Wood,   73  Fed.   Rep.  81  ;  Ger-  125  N.   Y.    763.     A  contract  of   sale 

mania  F.  Ins.  Co.  1).  Home  Ins.  Co.,  144  which  passes    the   equitable   title  and 

570 


CII.  XII.]  ALIENATION.  [§281 

§  280.  Change  amongst  Joint  Owners.  —  On  the  other  hand, 
there  are  numerous  and  respectable  authorities  not  only  that 
a  dissolution  of  the  partnership  and  a  division  of  the  prop- 
erty amongst  the  copartners  is  a  "transfer  or  change  of 
title,"  within  the  meaning  of  a  provision  making  the  policy 
void  on  such  transfer  or  change,^  but  also  that  a  sale  by  one 
partner  to  his  copartners  of  his  interest,  and  withdrawal 
from  the  firm,  is  an  alienation. 2  And  so  it  has  been  held, 
that  a  sale  by  one  tenant  to  his  co-tenant  is  an  alienation  ;3 
[and  also  that  it  is  not;'*  the  alienation  contemplated  by  this 
policy  being  held  in  Connecticut  to  be  a  transfer  from  a 
party  insured  to  one  not  insured],  So  a  division  on  petition 
for  partition  by  one  co-tenant  against  another  has  been  held 
to  be  a  change  in  the  title,  though  not  strictly  an  alienation. ^ 

§  281.  Change  of  Ownership ;  Right  of  Action.  —  And  the 
same  difference  of  opinion  prevails  as  to  the  proper  parties 
to  the  action  in  the  respective  cases.  By  some  of  the 
authorities  it  is  held  that,  in  case  of  the  sale  and  transfer 
by  one  partner  to  his  copartners  of  his  interest,  and  his 
retirement  from  the  firm,  an  action  cannot  be  maintained 
in  the  name  of  the  joint  insurers,  since  it  cannot  be  truly 
alleged  that  all  the  parties  were  interested  at  the  time  of 
the  loss,  and,  of  course,  there  being  no  joint  property  there 
could  be  no  joint  loss.^     The  prudent  course  in  cases  where 

1  Dreher  v.  Etna  Ins.  Co.,  18  Mo.  (3  Bennett)  128. 

2  Dix  V.  Mercantile  Ins.  Co.,  22  111.  272  ;  Keeler  v.  Niagara  Fire  Ins.  Co.,  16 
Wis.  523  ;  Hartford  Fire  Ins.  Go.  v.  Ross,  23  Ind.  179  ;  Finley  v.  Lycoming 
County  Mut.  Ins.  Co.,  30  Pa.  St.  311  ;  Portsmouth  Ins.  Co.  v.  Brinckley  (Va.), 
2  Ins.  L.  J.  843.  We  do  not  find  this  case  in  the  Virginia  Reports.  [Hathaway 
V.  State  Ins.  Co.,  64  Iowa,  229;  Keeler  v.  Niagara  Fire  Ins.  Co.,  16  Wis.  550, 
564.  An  indorsement  on  the  policy  by  the  company  with  knowledge  "  payable 
to  C,"  waives  the  forfeiture.      Id.,  565.] 

8  Buckley  v.  Garrett  et  al.,  47  Pa.  St.  280. 

*  [Lockwood  V.  Middlesex  Mut.  Ass.  Co.,  47  Conn    553.] 

^  Barnes  v.  Union  Mut.  Fire  Ins.  Co.,  51  Me.  110. 

6  Dix  V.  Mercantile  Ins.  Co.,  22  111.  272  j  Murdock  v.  Chenango  County  Mut. 
Ins.  Co.,  2  Comst.  (N.  Y.)  210  ;  Howard  et  al.  v.  Albany  Ins.  Co.,  3  Denio  (N.  Y.), 
301  ;  Bronson,  J.,  dissenting. 

benetieial  interest  is  a  violation  of  the  change  take  place  in  title  or  possession, 
policy  piovision  making  it  void  if  the  Cottingham  u.  Fireman's  Fund  Ins.  Co, 
property  be  sold  or  transferred,  or  any     90  Ky.  439, 

571 


§  282]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  XII. 

the  title  to  the  property  has  been  so  changed  is  to  assign  the 
policy  and  obtain  the  assent  of  the  insurers  to  the  assign- 
ment, when,  npon  all  the  authorities,  the  remaining  owner 
or  owners  may  sue  in  their  own  names. 

It  is,  however,  elsewhere  held  that  the  action  must  be 
joint,  and  that  if  the  sale  or  transfer,  as  of  one  partner  of 
his  interest  to  the  other,  is  without  the  consent  of  the  in- 
surers, the  plaintiff  will  recover  only  the  value  of  his  inter- 
est: while,  if  it  is  with  their  consent,  he  will  recover  to  the 
same  extent  as  if  there  had  been  no  transfer. ^  And  in  still 
another  case  it  was  held,  that  where  the  surviving  partner, 
by  one  of  the  articles  of  copartnership,  became  sole  owner 
on  the  death  of  his  copartner,  he  might  recover  in  his  own 
■  name  for  the  loss  of  the  goods  formerly  the  property  of  the 
firm,  destroyed  by  fire,  though  the  insurers  were  ignorant  of 
the  agreement.^  And  where  a  sole  trader  sells  an  undivided 
interest  in  the  insured  property  to  another,  who  thereby  be- 
comes a  partner,  the  insurers  assenting  to  the  transfer,  and 
that  the  policy  should  remain  good  to  the  new  firm,  and 
making  the  alienee  a  member  of  their  company  by  the  entry 
of  his  name  in  their  books  as  such,  it  has  been  held,  some- 
what strictly,  perhaps,  that  no  action  at  law  could  be  main- 
tained by  either  of  the  parties  severally,  or  by  both  jointly, 
since  neither  jointly  nor  severally  did  they  own  the  property 
at  the  time  of  the  insurance  and  at  the  time  of  the  loss. 
But  since,  under  the  circumstances,  there  was  no  adequate 
remedy  at  law,  a  joint  bill  in  equity  to  recover  the  loss  was 
sustained.^ 

§  282.  Waiver;  Consent,  —  But  a  forfeiture  by  alienation 
may  be  waived  by  the  insurers  or  their  agent;  and  a  consent 
by  the  agent,  who,  after  notice  of  the  alienation  by  the  in- 

1  Hobbs  ct  al.  v.  Memphis  Ins.  Co.,  1  Sneed  (Tenn. ),  444.  In  this  case  the 
court  say,  referring  to  the  New  York  cases  in  the  2d  of  Comstock  and  the  3d 
of  Denio,  before  cited,  that  they  have  carefully  considered  them,  and  do  not 
concur  in  the  doctrine  thereof,  nor  consider  it  founded  in  principle  or  authority, 
s.  c.  3  Ben.  Fire  Ins.  Cas.  87,  and  note,  49. 

2  Wood  V.  Rutland  &  Addison  Mut.  Fire  Ins.  Co.,  31  Vt.  552.  And  see  also 
Baltimore  Fire  Ins.  Co.  v.  McGowan,  16  Md.  47. 

3  Bodle  e<  al.  v.  Chenango  County  Mut.  Ins.  Co.,  2  Comst.  (N.  Y. )  53.  But 
see  Foster  ft  nl.  v.  Equitable  Mut.  Fire  lus.  Co.,  2  Gray  (Mass.),  416. 

572 


CH.  XII.]  ALIENATION.  [§  282  A 

sured,  forwards  the  policy  to  his  principals  for  their  ap- 
proval, that  the  policy  shall  remain  good  till  the  assent  of 
the  insurers  to  the  assignment  can  be  procured,  is  such 
waiver,^  An  assent  to  a  sale  generally  is  an  assent  to  all 
the  terms  of  the  sale,  and  covers  a  mortgage  back  to  secure 
the  purchase-money ;  2  but  a  consent  to  the  assignment  of  the 
policy,  indorsed  thereon  after  a  sale,  is  not  necessarily  a 
consent  to  a  mortgage  back  to  secure  the  purchase-money.  ^ 
And  consent  to  the  last  of  several  conveyances  is  a  waiver  of 
forfeiture  by  reason  of  either.^ 

[282  A.  But  consent  to  one  alienation  does  not  waive  a 
subsequent  transfer. ^  In  general  assent  of  the  agent  is  a 
waiver.^  If,  however,  alienation  is  to  avoid  the  policy  un- 
less the  consent  of  the  company  is  indorsed  thereon,  mere 
notice  to  the  company  of  the  transfer  is  not  sufficient,  nor 
is  the  company  bound  to  express  its  disapproval.  ^  Contra, 
in  Texas.  If  the  agent  knows  of  a  transfer  and  assents  to 
it,  the  company  is  estopped  to  set  up  the  provision  as  to  in- 
dorsement of  transfers.^  Payment  of  a  dividend  to  a  part- 
ner after  knowledge  that  the  firm  insured  has  dissolved  and 
the  property  transferred  to  the  said  partner,  is  a  waiver  of 
objection  on  such  ground.^  A  transfer  is  ratified  or  waived 
by  consenting  to  a  corresponding  assignment  of  the  policy, 
and  failure  of  the  company  for  a  year  after  notice  to  make 
objection  to  the  act  of  the  agent  in  assenting  to  such  an 
assignment  was  a  ratification  of  his  action,  i''  Though  a  policy 
is  to  be  void  by  levy  of  execution  on  the  property,  yet  if  the 
company  with  knowledge  of  such  levy  and  sale  consent  to  an 

1  Illinois  Mut.  Fire  Ins.  Co.  v.  Stanton,  57  111.  354.  And  see  also,  post,  chap- 
ter on  Waiver  and  Estoppel,  §  555. 

2  Farmers'  Ins.  Co.  v.  Ashton,  31  Ohio  St.  477. 

3  German  Nat.  Bank  v.  Agricultural  Ins.  Co.,  St.  Louis  Ct.  of  App.  9  Ins. 
Law  J.  556. 

*  Gilliat  V.  Pawtucket  Mut.  Fire  Ins.  Co.,  8  R.  I.  282.  As  to  notice,  see  post, 
§368. 

5  [iloulthrop  V.  Farmers'  Mut.  Fire  Ins.  Co.,  52  Vt.  123.] 

6  [Fire  Ins.  Co.  v.  Building  Ass,,  43  N.  J.  652.] 

7  [Girard  Fire  &  Mar.  Ins.  Co.  v.  Hebard,  95  Pa.  St.  45.] 

8  [Fire  Ins.  Ass.  v.  Miller,  2  Tex.  Civ.  Cas.  333. 

9  [Combs  V.  Shrewsbury  Ins.  Co.,  34  N.  J.  Eq.  403,  412.] 
10  [Benniughotf  v.  Agricultural  lus.  Co.,  93  N.  Y.  495.] 

573 


§  282  B]       INSUEANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  XII. 

assignment  of  the  policy  to  the  purchaser,  a  new  contract  is 
thereby  made  unaffected  by  the  forfeiture. ^  But  an  indorse- 
ment on  the  policy  "payable  in  case  of  loss  to  u4."  and  an 
indorsement  of  consent  thereto  by  the  company,  do  not  imply 
a  knowledge  or  a  consent  to  a  sale  of  the  goods  insured. ^ 
Knowledge  of  the  facts  and  tne  purpose  of  the  indorsement 
may,  however,  be  shown.  Oral  evidence  is  admissible  to 
show  that  the  plaintiff  informed  the  company  (after  issue  of 
a  policy  conditioned  to  be  void  upon  conveyance)  that  there 
had  been  a  conveyance  of  the  property,  at  the  same  time 
telling  them  of  an  outstanding  mortgage  and  requesting 
them  to  cure  the  defect,  and  that  they  indorsed  on  the  policy 
an  assent  to  an  order  of  the  plaintiff  for  the  payment  of  the 
policy  to  a  third  party  in  case  of  loss.^  A  sale  of  the  land 
under  the  insured  buildings  will  not  avoid  a  policy  where 
the  agent  has  full  knowledge  of  it  and  makes  indorsements 
on  the  policy  in  re'ference  to  it.^] 

[§  282  B.  Agent's  Knowledge.  —  The  commencement  of 
foreclosure  proceedings  will  not  avoid  the  policy,  although 
it  so  declares,  where  the  agent  of  the  company  knew  of  the 
existence  of  an  overdue  mortgage,  and  omitted  accidentally 
the  clause  making  the  insurance  payable  to  the  mortgagee, 
the  insured  being  ignorant  of  English  and  relying  on  the 
agent. ^  In  an  action  on  a  policy  parol  evidence  that  the  in- 
sured told  the  agent  about  an  intended  transfer  of  the  prop- 
erty, and  the  agent  said  the  policy  could  be  so  drawn  as  to 
cover  it,  is  inadmissible  to  vary  the  policy  from  its  actual 
terms.     The  suit  should  be  for  reformation.^] 

1  [Steen  v.  Niagara  Fire  Ins.  Co.,  89  N.  Y.  315.] 

2  [Bates  V.  Equitable  Ins.  Co.,  10  Wall.  33,  37.] 

8  [Oakes  v.  Manufacturers'  Ins.  Co.,  135  Mass.  248.] 
*  [Bonenfant  v.  Insurance  Co.,  76  Mich.  653.] 

5  [Butz  V.  Farmers'  Ins.  Co.,  76  Mich.  263.] 

6  [Walton  V.  Agricultural  Ins.  Co.,  116  N.  Y.  317.] 

574 


CH.  XII.]  APPENDIX. 


APPENDIX. 

The  following  "abstract  of  decisions  upon  alienation 
clauses  in  insurance  policies  "  will  be  found  of  great  use  to 
the  profession.  It  is  the  work  of  Augustus  Russ,  Esq.,  of 
the  Boston  bar,  to  whose  courtesy  and  that  of  the  publishers 
of  the  "  Insurance  Law  Journal  "  we  are  indebted  for  the 
privilege  of  inserting  it  here. 

Abstract  of  Decisions  upon  Alienation  Clauses  in  Insurance 

Policies. 

1.  "  Shall  be  alienated."  Rollins  v.  Columbia  Ins.  Co.,  5  Fost.  (N.  H.)  200 
(1852)  ;  3  Fire  Ins.  Cas.  393. 

2.  "  Alienated  (or  aliened)  by  sale  or  otherwise."  Lane  i\  Maine  Mut.  Fire 
Ins.  Co.,  12  Me.  44  (ISSii),  1  Fire  Ins.  Cas.  482  ;  Jackson  v.  Mass.  Mut.  Fire  Ins. 
Co.,  23  Pick.  (Mass.)  418  (1839),  1  Fire  Ins.  Cas.  764  ;  Neely  v.  Onondago  Mut. 
Fire  Ins.  Cas.  7  Hill  (N.  Y.),  49  (1844)  2  Fire  Ins.  Cas.  344;  McCuUoch  v. 
Indiana  Mut.  Fire  Ins.  Co.,  8  Blackf.  (Ind.)  50  (1846),  2  Fire  Ins.  Cas.  475  ;  Til- 
limon  V.  Vermont  Mut.  Fire  Ins.  Co.,  20  Vt.  546  (1848),  2  Fire  Ins.  Cas.  683  ; 
Adams  v.  Rockingham  Mut.  Fire  Ins.  Co.,  29  Me.  292  (1849),  3  Fire  Ins.  Cas. 
30  ;  Tillon  v.  Kingston  Mut.  Ins.  Co.,  5  N.  Y.  405  (1851),  3  Fire  Ins.  Cas.  238  ; 
Burbank  (;.  Rockingham  Mut.  Fire  Ins.  Co.,  4  Fost.  (N.  H.)  550  (1852),  3  Fire 
Ins.  Cas.  367  ;  Rice  v.  Tower,  1  Gray  (Mass.)  426  (1854),  3  Fire  Ins.  Cas.  725  ; 
Finley  v.  Lycoming  Mut.  Fire  Ins.  Co.,  30  Pa.  St.  311  (1858),  4  Fire  Ins.  Cas.  330; 
Hoxie  V.  Providence  Mut.  Fire  Ins.  Co.,  6  R.  I.  517  (1860),  4  Fire  Ins.  Cas.  484  ; 
Buckley  v.  Gannett,  47  Pa.  St.  204  (1864),  4  Fire  Ins.  Cas.  793  ;  Cowan  v.  Iowa 
St.  Ins.  Co.,  40  Iowa,  551  (1876),  5  Fire  Ins.  Cas.  766  ;  Lawrence  v.  Holyoke  Ins. 
Co.,  11  Allen  (Mass.),  387  (1865),  5  Fire  Ins.  Cas.  65  ;  Hill  v.  Cumberland  Val- 
ley  Mut.  Protection  Co.,  59  Pa.  St.  474  (1868);  Miner  v.  Judson,  5  T.  &  C. 
(N.  Y.)  46  (1874) ;  Masters  v.  Madison  City  Mut.  Ins.  Co.,  11  Barb.  (N.  Y.)  624 
(1852),  3  Fire  Ins.  Cas.  398  ;  Farmers'  Mut.  Ins.  Co.  v.  Gray  Bill,  74  Pa.  St.  17 
(1873),  5  Fire  Ins  Cas.  527  ;  Folsom  v.  Belknap  City  Fire  Ins.  Co.,  10  Fost. 
(N.  H.),  231  (1855);  Burger  v.  Farmers'  Mut.  Ins.  Co.,  71  Pa.  St.  422  (1872), 
5  Ins.  Cas.  454  ;  Conover  v.  Mut.  Ins.  Co.  of  Albany,  1  N.  Y.  290  (1848),  2  Fire 
Ins.  Cas.  677. 

3.  "Alienated  the  property  in  whole  or  in  part."  Tomlinson  v.  Monmouth 
Mut.  Fire  Ins.  Co.,  47  Me.  232  (1859),  4  Fire  Ins.  Cas.  447  ;  Smitli  v.  Monmouth 
Mut.  Fire  Ins.  Co.,  50  Me.  96  (1863),  4  Fire  Ins.  Cas.  723. 

4.  "Alienated  by  sale,  mortgage,  or  otherwise."  Shephard  r.  Union  Mut. 
Fire  Ins.  Co.,  38  N.'h.  232  (1859),  4  Fire  Ins.  Cas.  408  ;  New  Hampshire  Sav- 
ings Bank  v.  Union  Mut.  Fire  Ins.  Co.,  38  N.  H.  232  (1859),  4  Fire  Ins.  Cas.  408. 

5.  "  Alienated  by  sale,  assignment,  or  otherwise."  Campbell  v.  Hamilton  Ins. 
Co.,  51  Me.  69  (1863),  4  Fire  Ins.  Cas.  723. 

575 


INSUEANCE  :   FIKE,   LIFE,   ACCIDENT,    ETC.  [CH.  XII. 

6.  "  In  case  of  any  sale,  alienation,  transfer,  or  change  of  title."     Van  Dusen 
V.  Charter  Oak  Ins.  Co.,  1  Eobt.  (N.  Y.)  55  (1863),  4  Fire  Ins.  Cas.  694. 

7.  "  Shall  be  alienated  by  death,  sale,  or  any  other  means.''     Stetson  v.  Mass. 
Mat.  Fire  Ins.  Co.,  4  Mass.  330  (1808),  1  Fire  Ins.  Cas.  81. 

8.  "Shall  have  sold  or  alienated  the  property  in  whole  or  in  part."     Abbott 
V.  Hampden  Mat.  Fire  Ins.  Co.,  30  Me.  414  (1849),  3  Fire  Ins.  Cas.  86. 

9.  "  Shall  be  taken  possession  of  by  a  mortgagee  or  in  any  way  alienated." 
Young  V.  Eagle  Fire  Ins.  Co.,  14  Gray  (Mass.),  150  (1859),  4  Fire  Ins.  Cas.  417. 

10.  "  When  any  property  .  .  .  shall  in  any  way  be  alienated."  Clark  y.  N.  E. 
Mat.  Fire  Ins.  Co.,  6  Cush.  (Mass.)  342  (1850),  3  Fire  Ins.  Cas.  131. 

11.  "The  alienation  in  anyway  of  any  property  insured.''  Dadmun  Manu- 
facturing Co.  V.  Worcester  Mut.  Ins.  Co.,  11  Md.  429  (1846),  2  Fire  Ins.  Cas.  488; 
Wilson  V.  Trumbull  Mut.  Fire  Ins.  Co.,  19  Pa.  St.  372  (1852),  3  Fire  Ins.  Cas. 
496. 

12.  "  An}'  alienation  or  «ale  of  the  property."  Mount  Vernon  Manufacturing 
Co.  V.  Summit  City  Mut.  Fire  Ins.  Co.,  10  Ohio  St.  347  (1859),  4  Fire  Ins.  Cas. 
432. 

13.  "  Shall  alienate  or  sell  any  house  or  building  insured."  Trumbull  v.  Port- 
age City  Mut.  Ins.  Co.,  12  Ohio  305  (1843),  2  Fire  Ins.  Cas.  289. 

14.  "  If  the  title  to  the  property,  or  any  part  thereof,  shall  be  alienated." 
Davis  V.  Quincy  Mut.  Fire  Ins.  Co.,  10  Allen  (Mass.),  113  (1865),  5  Fire  Ins. 
Cas.  35. 

15.  "Alienation"  with  the  words  "the  commencement  of  foreclosure  pro- 
ceedings or  the  levy  of  an  execution  shall  be  deemed  an  alienation  of  the  prop- 
erty."    Colt  V.  Phcenix  Fire  Ins.  Co.,  54  N.  Y.  595  (1874),  5  Fire  Ins.  Cas.  537. 

16.  "  In  case  of  any  sale,  alienation,  transfer,  conveyance,  or  any  change  of 
title  in  the  property  insured  by  this  company  or  of  any  interest  therein,  .  .  . 
and  an  entry  for  foreclosure  of  mortgage,  or  the  levy  of  an  execution,  or  an 
assignment  for  the  benefit  of  creditors,  shall  be  deemed  an  alienation  of  the 
property."  Commercial  Ins.  Co.  v.  Spankneble,  52  111.  53  (1869),  5  Fire  Ins. 
Cas.  248. 

17.  "  All  alienations  and  alterations  in  the  ownership,  situation,  or  state  of  the 
property  insured  in  any  material  particular  shall  make  void  any  policy  cover- 
ing such  property."     Edmunds  v.  Mut.  Safety  Fire  Ins.  Co.,  1  Allen,  311  (1861), 

4  Fire  Ins.  Cas.  540. 

18.  "Sale."  Korcross  v.  Insurance  Companies  (Franklin  Fire  Ins.  Co.,  Spring 
Garden  Fire  Ins.  Co.),  17  Pa.  St.  429  (1851). 

19.  "Sold  or  conveyed."  Buchanan  «;.  Exchange  Fire  Ins.  Co.,  61  N.  Y.  36 
(1874),  5  Fire  Ins.  Cas.  591  ;  Bates  v.  Equitable  Ins.  Co.,  10  Wall.  33  (1869), 

5  Fire  Ins.  Cas.  274  ;  Bates  v.  Equitable  Ins.  Co.,  3  Cliff.  215  (1868)  ;  Keeler  v. 
Niagara  Fire  Ins.  Co..  16  Wis.  523  (1863),  4  Fire  Ins.  Cas.  653 ;  Washington  Ins. 
Co.  V.  Kelly,  32  Md.  421  (1870)  ;  Hoffman  v.  Mtna  Ins.  Co.,  1  Robt.  (N.  Y.)  501 
(1863)  ;  Hoffman  v.  iEtna  Ins.  Co.,  32  N.  Y.  405  (1865),  5  Fire  Ins.  Cas.  60  ; 
Heaton  v.  Manhattan  Fire  Ins.  Co.,  7  R.  I.  502  (1863),  4  Fire  Ins.  Cas.  699;  Wash- 
ington Ins.  Co.  V.  Hayes,  17  Ohio  St.  432  (1867),  5  Fire  Ins.  Cas.  139. 

20.  "Sell,  convey,  or  assign  the  subject  insured."  Fayette  City  Mut.  Ins. 
Co.  V.  Neel,  19  Albany  L.  J.  (Pa.)  75  (1878). 

21.  "  Sold  or  conveyed  in  whole  or  in  part."  Strong  v.  Manufacturers'  Ins. 
Co.,  10  Pick.  (Mass.)  40  (1830),  1  Fire  Ins.  Cas.  326  ;  Loring  v.  Manufacturers' 
Ins.  Co.,  8  Gray  (Mass.),  28  (1857),  4  Fire  Ins.  Cas.  172;  Hazard  v.  Franklin 
Mut.  Fire  Ins.  Co.,  7  R.  I.  429  (1863),  4  Fire  Ins.  Cas.  656. 

22.  "  Sold  or  conveyed  or  the  interest  of  the  parties  therein  changed."     Bur- 

576 


CH.  XII.]  APPENDIX, 

nett  V.  Eufaula  Home  Ins.  Co.,  46  Ala.  11  (1871),  5  Fire  Ins.  Cas.  362  ;  Ayers  v. 
Home  Ins.  Co.,  21  Iowa,  185  (1866),  5  Fire  Ins.  Cas.  94',  Germond  v.  Home  Ins. 
Co.,  2  Hun  (N.  Y.),  540  (1874)  ;  Germond  v.  Home  Ins.  Co.,  5  T.  &  C  (N.  Y.) 
120  (1874). 

23.  "  Shall  be  sold,  assigned,  transferred,  or  pledged."  Atherton  v.  Phoenix 
Ins.  Co.,  109  Mass.  32  (1871). 

24.  "Sale,  transfer,  or  change  of  title."  O'Neil  i>.  Hampden  Fire  Ins.  Co., 
13  Gray  (Mass.),  431  (1859),  4  Fire  Ins.  Cas.  415  ;  Western  Ins.  Co.  v.  Ricker, 
10  Mich.  279  (1862),  4  Fire  Ins.  Cas.  604;  Home  Fire  Ins.  Co.  of  Chicago  v. 
Hausline,  60  111.  521  (1871),  5  Fire  Ins.  Cas.  373;  Ayres  v.  Hartford  Fire  In.s. 
Co.,  17  Iowa,  176  (1864),  4  Fire  Ins.  Cas.  776. 

25.  "  When  the  title  of  any  property  shall  be  changed  by  sale,  mortgage,  or 
otherwise."  Barnes  v.  Union  Mut.  Fire  Ins.  Co.,  51  Me.  110  (1863),  4  Fire  Ins. 
Cas.  728. 

26.  "Transfer  by  sale  or  otherwise."  Texas  B.  &  Ins.  Co.  v.  Cohen,  47  Tex. 
406  (1877)  ;  Dernani  v.  Home  Ins.  Co.  of  New  Orleans,  26  La.  Ann.  69  (1874), 
5  Fire  Ins.  Cas.  534. 

27.  "  In  case  of  any  transfer  or  termination  of  the  interest  of  the  assured  by 
sale  or  otherwise."  Smith  v.  Saratoga  Mut.  Fire  Ins.  Co.,  1  Hill  (N.  Y.),  497 
(1841),  2  Fire  Ins.  Cas.  94  ;  Smith  v.  Saratoga  ut.  Fire  Ins.  Co.,  3  Hill  (N.  Y.), 
508,  2  Fire  Ins.  Cas.  94  ;  Power  v.  Ocean  Ins.  Co.,  19  La.  28  (1841),  2  Fire  Ins. 
Cas.  81  ;  Shotwell  v.  Jefferson,  5  Bosw.  (N.  Y.)  247  (1859),  4  Fire  Ins.  Cas.  409 ; 
Hooper  v.  Hudson  Fire  Ins.  Co.,  17  N.  Y.  424  (1858),  4  Fire  Ins.  Cas.  266; 
Phelps  V.  Gebhard  Fire  Ins.  Co.,  9  Bosw.  404  (1862),  4  Fire  Ins.  Cas.  624; 
Phcenix  Ins.  Co.  v.  Lawrence,  4  Met.  (Ky.)  9  (1862),  4  Fire  Ins.  Cas.  628;  Grov- 
enor  v.  Atlantic  Fire  Ins.  Co.,  17  N.  Y.  391  (1858),  4  Fire  Ins.  Cas.  254 ;  Hitch- 
cock V.  N.  W.  Ins.  Co.,  26  N.  Y.  68  (1862),  5  Fire  Ins.  Cas.  488,  note. 

28.  "  In  case  of  any  sale,  transfer,  or  change  of  title  in  the  property  insured  or 
of  any  Interest  therein  or  possession  by  another  of  the  subject  insured."  Lap- 
pen  V.  Charter  Oak  Fire  &  Mar.  Ins.  Co.,  58  Barb.  (N.  Y.)  325  (1870),  5  Fire  Ins. 
Cas.  328. 

29.  "  If  the  property  shall  be  sold,  or  transferred,  or  any  change  take  place  in 
title  or  possession,  whether  by  legal  process  or  judicial  decree,  or  voluntary  transfer 
or  conveyance."  PeiTv  v.  Lorillard  Fire  Ins.  Co.,  61  N.  Y.  214  (1874),  5  Fire  Ins. 
Cas.  597  ;  Savage  v.  Howard  Ins.  Co.,  Savage  v.  Long  Island  Jns.  Co.,  52  N.  Y. 
502  (1873),  5  Fire  Ins.  Cas.  484;  Miner  v.  Phrenix  Ins.  Co.,  27  Wis.  693  (1871), 
5  Fire  Ins.  Cas.  350;  Sherman  v.  Niagara  Ins.  Co.,  2  Sweeney  (N.  Y.),  470 
(1870),  5  Fire  Ins.  Cas.  384  ;  Sherman  v.  Niagara  Ins.  Co.,  40  Howard  Practice 
(N.  Y.),  393  (1870),  5  Fire  Ins.  Cas.  384  ;  Sherman  v.  Niagara  Ins.  Co.,  46  N.  Y. 
526  (1871),  5  Fire  Ins.  Cas.  384 ;  Keeney  v.  Home  Ins.  Co.  of  Columbus,  3  T.  & 
C.  (N.  Y.)  478  (1874),  5  Fire  Ins.  Cas.  555  ;  Keeney  v.  Home  Ins.  Co.  of  Colum- 
bus, 7  In.s.  L.  J.  108,  Court  of  Appeals,  N.  Y.  (1877)  ;  Browning  v.  Home  Ins. 
Co.  of  Columbus,  7  Ins.  L.  .T.  428,  Court  of  Appeals,  N.  Y.  (1877)  ;  Langdon  v. 
Minn.  Mut.  Fire  Ins.  Co.,  22  Minn.  193  (1875)  ;  Germania  Fire  Ins.  Co.  v.  Thomp- 
son, 7  Ins.  L.  J.  13,  U.  S.  S.  C.  (1877)  ;  Germania  Fire  Ins.  Co.  v.  Thompson, 
16  Albany  L.  J.  477,  6  Central  L.  J.  134  ;  Loy  v.  Home  Ins.  Co.  of  Columbus, 
2  N.  W.  Rep.  (Minn.)  83  (1878)  ;  Loy  v.  Home  Ins.  Co.  of  Columbus,  7  C.  L.  J. 
274,  and  G  Rep.  5S7  ;  Brunswick  Savings  Institution  v.  Commercial  Ins.  Co.,  18 
Albany  L.  J.  (Me.)  460  (1878) ;  Brunswick  Savings  Institution  v.  Commercial  Ins. 
Co.,  19  Albany  L.  J.  181  ;  Appleton  Iron  Co.  v.  Brit.  Am.  Ass.  Co.,  19  Albany  L. 
J.  (Wis.)  215  (1879). 

30.  "If  any  change  took  place  in  the  title  or  possession  of  the  propeity, 

VOL.  V  —  37  577 


INSURANCE :    FIRE,   LIFE,    ACCIDENT,    ETC.       [CH.  XII. 

whether  by  sale,  lease,   legal   process,  judicial   decree,   or   voluntary  transfer." 
McEwan  v.  Fraser,  1  Mich.   (N.   P.)  118  (1869). 

31.  "In  case  any  change  takes  place  in  the  title  or  possession  of  the  jjroperty, 
whether  by  sale,  legal  process,  judicial  decree,  voluntary  transfer  or  conveyance." 
Batchelder  v.  People's  Fire  Ins.  To.,  40  Conn.  56  (1873),  ^  Fire  Ins.  Cas.  482. 

32.  "  In  case  of  any  assignment,  transfer,  or  termination  of  the  interest  of  the 
insured  or  of  any  such  claim  by  sale  or  otherwise."  Day  v.  Poughkeepsie  Mut. 
Ins.  Co.,  23  Barb.  623  (1857),  4  Fire  Ins.  Cas.  181. 

33.  "In  case  of  any  sale,  transfer,  or  change  of  title  in  the  property  hereby 
insured,  or  of  any  part  of  it,  or  of  any  incumbrance  or  change  of  interest  in  any 
wise  of  the  assured,  or  the  foreclosure  of  a  mortgage  or  levy  of  an  execution,  or 
possession  by  another  of  the  subject  insured."  Pratt  v.  New  York  Central  Ins. 
Co.,  55  N.  Y.  505  (1874),  5  Fire  Ins.  Cas.  537. 

34.  "In  case  of  any  sale,  transfer,  or  change  of  title  in  property  insured  by 
this  company  or  of  any  (undivided)  (individual)  interest  therein,  .  .  .  and  the 
entry  of  a  foreclosure  of  a  mortgage  or  the  levy  of  an  execution,  shall  be  deemed 
an  alienation."  Ayres  v.  Hartford  Ins.  Co.,  21  Iowa,  193  (1866),  5  Fire  Ins.  Cas. 
94  ;  Ayres  v.  Hartford  Ins.  Co.,  17  Iowa,  176  (1864),  4  Fire  Ins.  Cas.  776  ;  Hart- 
ford Ins.  Co.  r.  Ross,  23  Ind.  179  (1864). 

35.  "  Where  property  (insured  by  this  policy)  or  any  part  thereof  shall  be 
alienated  or,  in  case  of  any  transfer  or  change  of  title  to  the  property  insured, 
or  any  part  thereof,  or  of  any  interest  therein,  ...  or  if  the  property  insured 
shall  be  levied  upon,  or  taken  into  possession  or  custody  on  any  legal  process,  or  the 
title  to  or  possession  be  disputed  in  any  proceeding  at  law  or  in  equity,  this  policy 
shall  cease."    Sossaman  v.  Pamlico  B.  &  Ins.  Co.,  7  Ins.  L.  J.  398  (N.C.),  (1878). 

36.  "  If  the  assured  shall  transfer."  Walker  v.  Firemen's  Ins.  Co.,  2  Handy 
(Ohio),  256  (1856). 

37.  "  If  the  title  to  the  property  is  transferred  or  changed."  Mclntire  v.  Nor- 
wich Fire  Ins.  Co.,  102  Mass.  230  (1869),  Fire  Ins.  Cas.  251  ;  Starkweather  r. 
Cleveland  Ins.  Co.,  2  Abb.  (U.  S.)  67  (1870),  5  Fire  Ins.  Cas.  328  ;  Geo.  Home 
Ins.  Co.  V.  Kinnear,  28  Gratt.  (Va.)  88  (1876). 

38.  "  In  case  of  any  transfer  or  change  of  title  in  the  property  insured." 
Dreher  v.  Minn  Ins.  Co.,  18  Mo.  128  (1853),  3  Fire  Ins.  Cas.  514  ;  Dix  v.  Mer- 
cantile Ins.  Co.,  22  111.  272  (1859),  4  Fire  Ins.  Cas.  380  ;  Dix  v.  Chicago  City  Ins. 
Co.,  22  111.  272  (1859),  4  Fire  Ins.  Cas.  380. 

39.  "A  transfer  or  change  of  interest."  Bates  v.  Commercial  Ins.  Co.,  2  Cin. 
(Ohio)  195  (1872). 

40.  "  In  case  of  any  transfer,  partial  transfer,  or  change  of  title  in  the  property 
insured."     West  Branch  Ins.  Co.  v.  Helfinstein,  40  Pa.  St.  289  (1861),  4  Fire  Ins. 

Cas.  565. 

41.  "  If  any  change  takes  place  in  the  title  or  possession."  Amazon  Ins.  Co. 
V.  Wall,  17  Albany  L.  J.  (Ohio)  489  (1878). 

42.  "  In  case  of  any  change  of  title  in  the  property  hereby  insured."  Knetts 
V.  Massasoit  Ins.  Co.,  56  Barb.  177  (1867),  5  Fire  Ins.  Cas.  488,  note;  Spring- 
field Fire  &  Mar.  Co.  v.  Allen,  43  N.  Y.  389  (1871). 

43.  "  Any  change  of  interest  in  whole  or  in  part."  Fernandez  v.  Great  West- 
ern Ins.  Co.,  3  Robt.  (N.  Y.)  457  (1865). 

44.  "  If  any  change  should  occur  affecting  the  title,  condition,  or  occupancy 
of  the  property,  whereby  the  risk  will  be  increased."  Residence  Fire  Ins.  Co.  v. 
Hannanold,  37  Mich.  103  (1877). 

45.  "  If  the  property  was  levied  on  or  taken  in  custody  by  the  law."  Mills  v. 
Ins.  Co.,  5  Phila.  28  (1862),  4  Fire  Ins.  Cas.  653. 

578 


CH.  XII.]  APPENDIX. 

46.  "  The  insurance  shall  cease  from  the  time  that  the  property  hereby  in- 
sured shall  be  levied  on  or  taken  into  custody  under  an  execution  or  other  pro- 
ceeding at  law  or  equity."  Philadelphia  Fire  k  Life  Ins.  Co.  v.  Mills,  44  Pa.  St. 
241  (1863),  4  Fire  Ins.  Cas.  730. 

47.  "This  policy  ceases  to  be  in  force  as  to  any  property  hereby  insured 
which  shall  pass  from  the  insured  to  any  other  person  otherwise  than  by  will  or 
operation  of  law."  Forbes  v.  Border  Counties  Fire  Office,  Cases  in  the  Court  of 
Sessions,  3d  series,  vol.  xi.  278  (1873),  5  Fire  Ins.  Cas.  460. 

48.  "  If  said  property  shall  be  sold  or  conveyed,  or  the  interest  of  the  parties 
therein  be  clianged  in  any  manner,  whether  by  act  of  the  parties  or  by  operation 
of  law,  or  the  property  shall  become  incumbered  by  mortgage,  judgment,  or 
otherwise."  Sherwood  v.  Agricultural  Ins.  Co.,  7  Ins.  L.  J.  520,  Court  of  Ap- 
peals, N.  Y.  (1878)  ;  Sherwood  v.  Agricultural  Ins.  Co.,  17  Albany  L.  J.  433, 
6  Rep.  213. 

49.  "  In  case  of  any  transfer  or  termination  of  the  interest  of  the  insured,  or 
any  part  of  his  interest  in  the  property  hereby  insured,  either  by  sale,  contract, 
or  otherwise,  or  in  case  any  mortgage,  lien,  or  incumbrance,  shall  be  executed 
thereon,  or  shall  attach  thereto,  or  if  the  title  thereto  shall  be  in  any  way 
changed  or  affected  after  the  date  of  this  policy,  or  if  any  proceedings  for  sale 
thereof  shall  be  had,  commenced,' or  taken,  or  if  the  title  thereto  shall  be  or  be- 
come less  than  an  absolute  and  perfect  one."  Michigan  State  Ins.  Co.  v.  Lewis, 
30  Mich.  41  (1874),  5  Fire  Ins.  Cas.  559. 

50.  "  The  insurance  under  this  policy  shall  cease  at  and  from  the  time  the 
property  hereby  insured  shall  be  levied  on  or  taken  into  possession  or  custody 
under  any  proceeding  in  law  or  equity,  and  should  there,  during  the  life  of  this 
policy,  au  incumbrance  fall  or  be  executed  upon  the  property  insured  sufficient 
to  reduce  the  real  interest  of  the  insured  in  the  same  to  a  sum  only  equal  to  or 
below  the  amount  insured."  Smith  v.  Farmers'  &  Mechanics'  Mut.  Fire  Ins.  Co., 
8  Ins.  L.  J.  (Pa.)  828  (1879). 

579 


INSUEANCE  :    FIRE,  LIFE,   ACCIDENT,   ETC.       [CH.  XIII. 


CHAPTER  XIII. 

TITLE   AND   INCUMBRANCE. 

Analysis. 

1.   Title. 

"  Property  "  means  the  thing  insured  ;  "  title,"  the  right  to  or  inter- 
est in  it,  §  283. 
the  title  is  no  part  of  the  description  of  the  property,  or  its  con- 
dition, situation,  value,  or  risk,  §  283. 
Unless  inquiry  is  made  the  title  need  not  be  stated  ;  it  being  suf- 
ficient if  in  fact  the  assured  has  an  insurable  interest, 
§§  284,  285. 
and  where  such  is  the  case,  there  is  a  strong  tendency  to 
hold  the  company  if  the  assured's  representations  can  be 
made  to  fit  the  facts  either  substantially  or  literally,  §  284. 
no  misrepresentation  that  does  not  diminish  the  risk  will 

be  fatal,  §  287,  n. 
it  is  sufficient  if  the  title  is  actually  good,  though  it  appears 
defective  on  the  records,  §  285,  n. 
Where  no  inquiry  is  made  calling  the  property  "his"  or  him- 
self the  "  owner"  is  right,  if  in  any  substantial  sense  it  is 
his,  although  (§  285)  — 
it  is  on  the  land  of  another,  §  285. 
or  attached,  §  285. 
or  he  is  only  tenant  for  life,  §  285. 
or  for  years,  §  285. 
or  joint  owner,  §  285. 
or  vendee  with  deed  passed  to  third  person  for  him, 

§  285. 
or  possessor  under  a  contract  of  purchase,  §§  285,  287 

(even  though  parol). 
or  holder  of  a  claim  enforceable  in  equity,  §  285,  and 
notes, 
it  is  not  misrepresentation  for  the  equitable  owner 
to  claim  full  title,  §  285,  n. 
or  vendor  before  delivery,  §  285. 
or  judgment  creditor  to  whom  the  property  has  been  set 

off  subject  to  mortgage,  §  287. 
or  purchaser  at  foreclosure  or  sheriff's  sale  before  deed 

acknowledged  or  passed,  §  287. 
or  grantor  with  defeasance  back  unrecorded,  §  285,  u. 
or  mortgagor  before  redemption  expires,  §  285,  u. ;  other- 
wise after. 

580 


CH.  XIII.]  TITLE   AND   INCUMBRANCE. 

whether  holder  of  title-bond  from  one  who  was  suing  in 
equity  to  perfect  his  title,   is  owner,  for  the  jury  to 
decide,  §  284. 
a  sheriff's  sale  before  insurance  and  annulled  afterwards  does 
not  affect  the  ownership,  §  285. 
Particular   interest   need   not  be  stated  ;   the  insurance  may  be 
general,    and    recovery    according   to   the    interest    proved, 
§  285,  n. 
except  in  reassurance,  bottomry,   and  freight,   profits,   &c.,   in 
some  cases,  §  285,  n. 
lithe  "true  title  "  is  called  for  it  must  be  stated  with  substantial 
accuracy,  §  287. 
it  will  not  do  to  call  the  property  "his"  when  he  is  only  a 
tenant  by  curtesy,  §§  287,  289. 
part  owner,  §  287. 
stockholder,  §  287. 
mortgagee,  §  287. 
mortgagor,  §  287. 
if  the  charter  requires  statement  of  title  if  less  than  a  fee- 
simple,  an  omission  to  state  title  is  a  warranty  of  a  fee-simple, 
§  287. 
individual  may  insure  his  property  under  his  trade  name  though 

it  makes  the  insurer  thiuk  it  is  corporate  property,  §  287. 
"  good  and  perfect  unincumbered  title,"  mortgage  paid  but  not 
discharged  of  record  is  a  breach,  §  289. 
Fee-simple,  "  if  title  less  than,  it  must  be  stated,"  §  289. 

verbal  gift  cannot  create,  and  though  deed  made  and  delivered 

before  loss,  policy  void,  §  289. 
mortgagee  under  absolute  deed  may  so  state  his  title,  §  289,  end. 
fee  of  undivided  portion  of  land  under  buildings  not  sufficient, 

§  289. 
husband  cannot  call  wife's  property  "  his  "  when  charter  re- 
quires fee-simple,  §  289. 
see,  where  agent  knows  the  facts,  §  294  E. 
warranty  of  fee-simple  true  if  he  can  enforce  specific  perform- 
ance of  a  bond  to  convey,  §  289. 
if  several  persons  are  insured  in  respect  to  the  same  property, 
the  condition  applies  to  the  sum  of  their  interests,  §  289. 
"  Sole  and  unconditional  owner:  " 

mortgagor  of  chattels  is,  §  286. 
"  Entire,  unconditional,  and  sole  owner  :  " 
valid  condition,  §  287  A. 
breach  fatal,  §  287  A. 

so  is  failure  to  disclose  true  title  if  not  as  required  by  policy, 
though  no  question  asked  at  time  of  application,  §  287  A. 
mortgagor  in  possession  in  some  States  is,  §  287. 
in  general  mortgage  must  be  stated,  §  287. 
contra,  §  287  C,  even  as  to  absolute  deed  intended  as  a 
mortgage. 
vendee  though  giving  mortgage  for  price,  §  287  C. 

or  allowing  the  vendor  to  retain  the  legal  title  as  security, 
§  287  C. 

581 


582 


INSURANCE  :   FIRE,   LIFE,   ACCIDENT,   ETC.      [CH.  XIII. 

a  lien  does  not  affect,  §  287  C. 
nor  a  conditional  sale,  §  287  C. 

nor  an  agreement  to  give  clerk  a  share  of  profits,  §  287  C. 
nor  a  dry  legal  title  in  another,  §  287  C. 
sole  beneficial  right  sufiicient,  §  287  C. 
equitable  owner  is,  in  respect  to  insurance,  §  287  0. 
one   in   possession    under   a   valid   contract   of   purchase   is, 
§  287  C. 

though  he  has  assigned  his  contract  as  collateral,  §  287  0. 
but  mere  verbal  promises  to  convey  are  not  sufl^icient,  §  287  C. 
if  the  description  says  "held  in  trust"  or  otherwise,  the  com- 
pany has  notice,  the  condition  does  not  apply,  §  287  C. 
Not  entire,  unconditional,  and  sole  owner. 

if  there  is  any  outstanding  right,  legal  or  equitable,  §  287. 

as  iax-title,  &c.,  §  287,  end. 
stockholder  as  to  corporate  property  though  pledged  to  him, 

§  287,  n. 
holder  under  quitclaim  from  second  mortgagee,  §  287  B. 
leasehold  and  contract  of  purchase  of  personalty,  price  unpaid, 

§  287  B. 
surviving  partner,  §  287  B. 
life  tenant,  §  287  B. 
Leasehold  interest.     Absolute  interest : 
interest  and  title  are  not  synonymous, 
if  the  loss  would  fall  on  A,  his  interest  is  absolute,  §  288. 
possessor  under  contract  of  purchase  with  part  payment,  §  288 

(absolute)  ?  §  288. 
pledgor,  §  288. 
lessee  owning  building  to  be  left  on  land  at  end  of  lease,  not 

leasehold,  §  288. 
mechanics'  lien,  §  288. 
not  stating  leasehold  when  required  by  policy,  fatal,  though 

no  question  asked  at  application,  §  288. 

2.   Incumbrance. 
The  object  of  inquiring  about  incumbrances  is  to  aid  in  determin- 
ing the  motive  of  the  assured  to  preserve  the  property,  and 
in  case  of  mutual  companies  to  know  the  Value  of  their  lien 
for  premiums,  §  290. 
The  same  thing  may  be  an  incumbrance  or  not  according  to  cir- 
cumstances and  the  disposition  of  the  court,  §§  291-294. 
and  the  language  of  the  policy  may  make  it  void,  only  for 
burdens  put  on  the  property  by  consent  of  the  assured, 
§§  292,  end,  292  A  (as  where  the  condition  runs  against 
incumbrances   "without  consent  of  the  company,"   for 
the  assured  could  not  get  assent  for  a  lien  put  on  by 
some  one  else,  perhaps  without  his  knowledge,  §  292). 
or  it  may  be  void  for  any  burden  though  ])laced  by  the  law, 

and  even  unknown  to  the  assured,  §  291  A. 
an  "incumbrance  on  the  property  "  means  on  the  whole  prop- 
erty insured,  and  an  incumbrance  on  part  of  it  will  not 
be  fatal,  §  291  (strict  construction). 


CII.  XIII.]  TITLE   AND   INCUMBRANCE. 

"What  is  an  incumbrance,  §§  291,  291  A. 
What  is  not,  §§  292,  292  A. 

assessment  of  deposit  note  (?),  §§  291,  292. 

attachment  may  be,  §  291. 

bond  for  support  not,  §  292  ;  cmitra,  §  292,  n. 

nor  bond  to  convey  where  the  time  named  has  passed,  §  292. 

curtesy,  if  contingent,  not,  §  292. 

power,  if  contingent,  not,  §  292. 

judgment,  see  lien. 

lease  for  years  not,  §  292  A. 

lieu  may  be,  §  291 ;  or  not,  §§  292,  292  A. 

for  taxes  may  be,  §  291  ;  or  not,  §  292  A, 
not,  if  assessment  is  illegal,  §  292  A. 
for  purchase-money  may  be,  §  291  ;  or  not,  §  292. 
of  a  judgment  may  be,  §  291,  291  A  ;  or  not,  §  292. 
not   if    paid    though    undischarged  of    record, 
§  291,  n. 
by  collateral  deposit  of  deeds,  §  291. 
mechanics'  lien  may  be,  §  291. 
mortgage  is,  §§  291,  292  B. 

thoLigh  fraudulent  and  unrecorded,  §  291. 
so  partner's  mortgage  to  outsider,  §  291  A. 
but  not  if  paid,  though  undischarged  of  record,  §  292. 

the  presumption  is  that  a  mortgage  is  not  paid,  §  294. 
nor  if  barred  by  statute  of  limitations,  §  292. 
house  on  blocks  held  encumbered  by  mortgage  on  land, 
§  294  F. 
sale  on  execution  is,  §  291. 
seizure  on  execution  is,  §  291. 

but  not  levy  of  goods  left  with  debtor,  §  291  n. 
tax  title  that  is  a  constructive  trust  not,  §  292. 
Misrepresentation  or  concealment  of  an  incumbrance  will  be  fatal 
when  the  application  questions,  or  the  policy  or  the  organic 
law  requires  disclosure  (§  292  B)  ;  a  requirement  in  the  by- 
laws not  a  part  of  the   policy,  and   unknown  to  the  assured, 
would  not  probably  be  sufficient  (see  §  294  a).      Where  the 
questions  asked  are  fairly  and  honestly  answered  by  the  as- 
sured, a  condition  as  to  disclosure  in  the  after  coming  policy 
ought  not  to  affect  him  (see  §  292  A  ;  125  Pa.  St.).   The  com- 
pany  should  call  for  the  information  they  want  in  the  applica- 
tion, not  in  the  policy, 
where  the  assured  says  there  is  no  incumbrance,  which  is  true, 
but  he  believes  there  is,  not  knowing  that  a  mortgage  has  been 
paid,  his  bad  faith  avoids  the  policy  (§  292  B).     The  moral 
hazard  is  the  same  as  if  the  mortgage  teas  good. 
materiality  for  jury,  §  292  B. 
misstatements  as  to  incumbrances  on  other  land  not  material, 

§  292  B. 
if  the  representation  is  substantially  true  and  in  good  faith,  tak- 
ing into  account  all  the  equities  and  even  parol  agreements 
void  under  the  statute  of  frauds,  the  policy  will  be  upheld 
(§  292  B).  A  stranger  to  th&agreement  cannot  raise  such  a  plea. 

583 


INSURANCE  :    FIRE,   LIFE,    ACCIDENT,   ETC.         [CH.  XIII. 

stating  that  there  is  an  incumbrance  without  the  amount,  suf- 
ficient, §  292  B. 
omission  not  fatal  if  all  company's  questions  are  truly  answered, 
§  292  B. 
Subsequent  incumbrance,  §  294. 

if  paid  before  loss  policy  good,  §  294. 
Paying  oil"  old  incumbrance  and  a  new  one  arising,  §  294,  end. 
if  the  total  incumbrance  is  less  than  at  the  time  of  insurance 
the  policy  ought  not  to  be  void,  unless  the  express  provisions 
are  inconsistent  with  any  other  construction,  §§  294,  end, 
and  291  A. 
If  the  policy  permits  incumbrance  only  to  a  certain  amount,  going 

beyond  it  is  fatal,  §  291  A. 
Notice  of  incumbrance  : 

must  bfi  given  if  required,  §  294  a. 
delay  of  fifty  days  unreasonable,  §  294  a. 
indorsement  "loss  payable  to  mortgagee,"  is  notice,  §  294,  a. 
putting  in  mail  is  prima  facie,  §  294  a. 
provision  for,  in  by-laws  alone  not  sufficient,  §  294  a. 
Waiver  (and  estoppel)  : 

of  statement  of  title, 

by  insurance  "  as  interest  may  appear,"  §  294  C. 
by  soliciting  agent,  §  294  C. 
of  condition  as  to  sole  ownership, 

cannot  make  policy  cover  goods  of  strangers,  §  294  C. 
of  inc'umbrance, 

by  indorsing  policy  payable  to  mortgagee,  §  294  C. 
assent  to  substituted  mortgage  waives  old  one,  §  294  C. 
neglect  of  agent  to  ask  any  question  about  incumbrance 
estops  company  in  case  of  one  ignorant,  of  English  ; 
signing  application  agent  said  was  all  right,  §  294  C  ; 
in  general,  such  neglect  is  not  a  waiver  of  the  "  sole" 
&c.,  condition  in  the  policy,  §  294  G. 
if  answer  or  omission  is  hona  fide  made  by  advice  of 
agent,  company  estopped  to  object  to  it,  §  294  b. 
if  the  description  is  inconsistent  with  absolute  ownership,  or 
shows  that  required  facts  are  omitted,  or  in  any  way  the 
company   has   notice,    issue  of   a    policy  is  a  waiver, 
§§  294  D,  294  b. 
by  adjustment  of  loss  by  agent  with  knowledge  of  facts, 

§  294  b. 
or  neglect  to  endorse  or  make  proper  statement,  §  294  b. 
knowledge  of  the  agent  at  the  time  of  insurance  or  before 
issue  of  a  policy  that  there  is  a  lien  or  mortgage  or 
other  incumbrance,  or  that  the  insured  is  not  the  sole 
owner,  &c.,  is  a  waiver,  if  the  assured  acted  in  good 
faith,  although  the  policy  declares  there  shall   be  no 
waiver  except  in  writing,  and  sole  ownership,  &c.,  is 
warranted,  §  294  E. 
but  otherwise  if  the  assured  actually  knows  of  the  war- 
ranty or  erroneous  information  that  goes  to  the  com- 
pany, §  294  E. 

584 


CH.  XIII.]  TITLE   AND   INCUMBKANCE.  [§  283 

and  failure  at  trial  to  prove  the  truth  of  the  facts  stated 
to  the  agent  is  fatal,  §  294  E. 
Contra,  it  has  been  held  that  one  signing  a  document  must 

know  its  contents,  §  294  F. 
and  if  policy  says  "  no  waiver  by  agent  "  there  can  be  none, 
§  294  F. 
no  waiver  or  estoppel  — 

by  admission  of  a  director  or  by  vote  of  directors  authoriz- 
ing settlement,  if  assured  has  not  changed  his  position  in 
conset^uence,  §  294  G. 
by  sending  adjuster  before  company  knows  facts,  §  294  G. 
by  a  verbal  agi-eeraent  (before  policy,  but  left  out  of  it)  to 
allow  insured  to  mortgage,  §  294  G. 

§  283.    Title  and  Property   distinguished.  —  Inquiries  about 
a  greater  or  less  interest  and  a  more   or  less  perfect  title 
usually  refer  to  the  quality  of  the  estate,  having  reference  to 
its  duration,  whether  an  estate  in  fee,  for  life,  for  years,  or 
at  will,  to  what  is  vested  in  distinction  from  what  is  condi- 
tional or  contingent,  and  not  to  questions  of  incumbrance  as 
affecting  the  quantity  of  the  estate. ^     "Title  "  has  respect  to 
that  which  is  the  subject  of  ownership,  and  is  that  which  is 
the  foundation  of  ownership,  and  with  a  change  of  title  the 
right  of  property  —  the  ownership  —  passes,  (a)     "  Property  " 
is  a  thing  owned,  that  to  which  a  person  has,  or  may  have, 
a  legal  title.     Both  words  are  inappropriate  to  describe  the 
insurable  interest  which  exists  solely  by  reason  of  the  per- 
sonal liability  of  the  insured  for  the  payment  of  a  sura  of 
money  charged  upon  the  building  or  goods  insured.     When, 
therefore,  the  word  "  property  "  is  used  in  the  clause  forbid- 
ding alienation,   it  is  used  to  designate  the  thing  insured, 
and  not  the  interest  of  the  insured  in  the  thing;  and  "change 
or  transfer  of  title  "  in  the  property  insured  is  change  or 
transfer  of  title  and  ownership  of  the  thing  insured.  ^     The 
title  or  interest  of  the  assured  in  the  property  insured  is  no 
part  of  the  description  of  the  property,  and  need  not  there- 

1  Hough  V.  City  Fire  Ins.  Co.,  29  Conn.  10 ;  Wooddy  v.  Old  Dominion  Ins. 
Co.,  31  Grat.  (Va.),  362. 

2  Springfield  Fire  &  Mar.  Ins.  Co.  v.  Allen,  43  N.  Y.  389. 

(a)  The  word  "interest"  has  a  Gibb  v.  Phila.  F.  Ins.  Co.,  59  Minn. 
broader  meaning  than  "  title,"  and  in-  267.  See  Sun  Fire  Office  v.  Clark,  53 
eludes  both  legal  and  equitable  rights.     Ohio  St.  414. 

585 


§  284]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,    ETC.        [CH.  XIII. 

fore  be  mentioned  in  answer  to  a  call  for  a  true  description 
of  the  property  ^  or  under  a  requirement  to  state  the  "  condi- 
tion, situation,  value,  or  risk"  of  the  property  insured.2(a) 
And  where  the  insurance  is  "as  interest  may  appear,"  the 
whole  question  of  interest,  title,  and  ownership  is  an  open 
one,  and  the  insurers  cannot,  after  loss,  predicate  upon  such 
an  uncertain  phrase,  misrepresentation,  or  concealment,  upon 
either  of  the  questions  so  left  open,^  In  many  of  the  States, 
misrepresentations  as  to  title  and  interest,  unless  fraudulent 
and  material,  are  now  rendered  harmless  by  statute. 

So  where  no  condition  as  to  statement  of  title  is  contained 
in  the  policy,  great  liberality  both  of  proof  and  construction 
will  be  allowed  the  applicant  to  enable  him  to  recover,  as 
that  by  relations  with  his  partner  he  is  equitably  sole  owner.* 

§  284.  Title.  —  In  general,  unless  the  title,  ownership,  or 
interest  in  the  insured  property  is  required  by  the  conditions 
of  the  policy  to  be  specifically,  and  with  particularity  and 
accuracy,  set  forth,  it  will  be  sufficient  if  the  insured  has  an 
insurable  interest,  under  any  status  of  ownership  or  posses- 
sion. And  the  fact  that  the  statements  in  the  application 
are  by  reference  made  a  part  of  the  contract,  and  thus  be- 
come warranties,  will  have  no  effect  in  extending  the  force 
or  effect  of  these  statements  beyond  their  actual  import. 
Thus,  where  a  married  woman  had  been  abandoned  by  her 
husband,  but,  with  the  family,  remained  on  the  homestead, 
which  had  been  occupied  by  them  before  the  separation,  and 
with  her  own  earnings  made  improvements  from  time  to 

Franklin  Ins.  Co.  v.  Coates,  14  Md.  285. 

2  Kerr  v.  Hastings  Mut.  Fire  Ins.  Co.,  41  U.  C.  (Q.  B.)  217  ;  Kerr  r.  Gore 
Dist.   Mut.  Fire  Ins.   Co.,  1  Ont.  App.  Rep.  37.5. 

3  Dakin  v.  Liverpool,  &c.  Ins.  Co.,  13  Hun  (N.  Y,),  122;  8  Ins.  L.  J.  579  ; 
Ramsey  v.  Phcenix  Ins.  Co.,  C.  Ct.  (N.  Y.)  2  Fed.  Rep.  429. 

*  Liverpool,  &e.  Ins.  Co.  v.  McGuire,  52  Miss.  227.  See  also  Continental  Ins. 
Co.  V.  Ware  (Ky.),  9  Ins.  L.  J.  519. 

(a)   If  the   insured   shows  that  in-  not  their  owner  when  the  policy  was 

sured    chattels    belong  to  him  at  the  taken  out.    Morris  v.  Imperial  Ins.  Co., 

date  of  the  lire,  or  that   he  then  had  106  Ga.  461.     It  is  the  insurer's  duty 

possession    coupled   with    a    bona   fide  to  make  due  inquiries  when  the  policy  is 

claim  of  right  to  them,  the  burden  is  issued,  and   not  later.     Peet  v.  Dakota 

upon  the  insurer  to  show  that  he  was  F.  &  M.  Ins.  Co.,  1  So.  Dak.  462. 

586 


CH.  XIII.]  TITLE    AND    INCUMBRANCE.  [§  284 

time,  it  appearing  that  the  husband,  on  leaving,  made  a 
verbal  gift  of  the  property  to  her,  it  was  held  that  she  had 
an  insurable  interest.  Application  was  made  for  insurance 
upon  one  dwelling-house  and  certain  personal  property 
therein  contained,  and  to  the  question  whether  the  title 
was  a  warranty  deed  or  a  bond,  the  answer  was,  "W.  D." 
And  to  the  further  question,  "Is  your  property  incum- 
bered ?  "  the  answer  was,  " None."  These  being  all  the  state- 
ments in  the  application  touching  the  title  of  the  insured,  it 
was  alleged  in  defence  that  there  was  a  breach  of  warranty, 
and  no  proof  of  ownership  in  fee,  but  the  court  did  not  take 
this  view.i     [The  courts  manifest  a  strong  tendency  to  hold 

1  The  court  said,  "  We  fail  to  find  by  the  application  of  the  meaning  attached 
to  words  that  the  insured  represented  herself  as  holding  any  particular  kind  of 
title.  The  words  '  one  dwelling-house  '  do  not  import  title  of  any  kind.  The 
letters  'W.  D.'  have  Ho  such  meaning ;  nor  has  the  question,  '  Is  your  property 
incumbered  ? '  If  the  letters  '  W.  D.'  mean  a  warranty  deed,  it  must  appear  from 
extrinsic  evidence,  if  that  could  be  received.  They  have  no  such  fixed  and  defi- 
nite meaning  in  the  law,  nor  in  any  common  use,  nor  even  in  the  connection  in 
•which  they  are  employed.  That  may  be  their  meaning,  but  it  is  not  apparent. 
But  if  it  was  conceded  that  they  mean  that  the  insured's  title  was  a  warranty 
deed,  still  that  is  not  an  assertion  that  such  title  is  a  fee.  A  warranty  deed  may 
pass  a  term  of  years,  a  life-estate,  a  fee,  or  less  estate,  or  it  may  pass  no  estate 
whatever.  It  conveys  only  the  estate  of  the  grantee,  whatever  that  may  be. 
If  we  have  none,  it  can  pass  none  to  the  grantee.  We  then  look  in  vain  for 
any  assertion  in  the  application  as  to  the  kind  of  title,  or  the  nature  of  the  estate 
she  claimed.  It  then  does  not  appear  from  the  application  that  she  was  required 
to  prove  that  she  held  a  fee  or  other  absolute  estate  in  the  lot  and  house.  Then, 
under  the  averment  in  the  declaration,  what  was  she  bound  to  prove  ?  Mani- 
festly that  she  held  and  owned  an  insurable  interest,  —  such  a  title  as  if  there 
should  be  loss  it  would  fall  upon,  and  have  to  be  borne  by  her.  In  a  declaration 
on  a  policy  of  insurance,  the  averment  that  the  insured  was  the  owner  of  the 
property  destroyed  must  be  considered  with  reference  to  the  contract  of  insurance. 
It  amounts  to  an  averment  that  the  insured  had  an  insurable  interest,  and  not 
that  he  was  the  absolute  owner  of  the  property.  When  he  sues,  his  right  to  re- 
cover depends  upon  whether  he  was  the  owner  of  an  insurable  interest,  and  not 
whether  he  was  the  absolute  owner,  and  the  averment  must  be  so  construed.  It 
cannot  be  construed  as  it  would  be  in  a  contract  or  covenant  to  convey  land,  as  in 
such  case  the  thing  sold  and  purchased  is  the  land  ;  and  when  the  vendor  says, 
in  his  covenant,  that  he  is  the  owner,  and  agrees  to  convey  it  to  another,  the  law 
holds  that  as  the  parties  understood  by  the  covenant  that  it  was  the  land  that 
was  sold,  that  the  assertion  of  ownership  implied  that  the  vendor  held  the  abso- 
lute title,  and  had  agreed  to  convey  such  a  title  as  would  vest  in  the  vendee 
absolute  ownership.  Language  not  having  a  technical  meaning  must  be  con- 
strued with  reference  to  the  subject  to  which  it  is  applied.  Thus,  under  either 
the  ai>plication  for  the  insurance  or  the  averment  in  the  declaration,  the  iijsured 
was  bound  only  to  prove  that  she  held  an  insurable  interest,  and  all  questions  be- 

587 


§  284]  INSUEANCE :     FIRE,   LIFE,    ACCIDENT,   ETC.        [CH.  XIII. 

the  company  if  the  assured  has  an  insurable  interest,  and  in 
such  cases  show  great  ingenuity  in  making  his  answers  fit 
the  facts,  sustaining  them  if  either  suhstantially  or  literally 
(though  only  literally  and  not  substantially)  they  can  be  ad- 
justed to  the  truth.  When  the  assured  in  answer  to  the 
question  "What  is  your  title  to  or  interest  in  the  land?" 
answered  "Deed,"  she  having  only  an  inchoate  right  of 
dower,  but  her  husband's  title  having  come  by  deed,  it  was 
held  to  be  no  breach  of  warranty  sufficient  to  work  a  forfeit- 
ure. ^  In  answer  to  the  question  "What  title  has  the  occu- 
pant ?  "  he  said,  "  Warranty  deed  ; "  "  Number  of  acres  ?  "  — 
"160."  He  had  warranty  deeds  for  the  whole,  but  for  120 
acres  the  deeds  were  given  to  him  in  order  that  he  might 
sell  the  land  for  the  owner.  The  deeds  were  absolute  on 
their  face,  there  being  no  mention  of  the  trust;  wherefore 
it  was  held  that  his  answer  was  sufficient.  If  the  company 
wished  to  know  the  equities  they  should  have  inquired  about 
them.2  Where  the  insured  who  described  the  property  as 
"his"  had  bought  a  fee  simple,  and  held  a  title  bond  from 
the  vendor,  whose  title  was  imperfect  by  reason  of  a  rever- 
sionary interest  of  one-seventh  belonging  to  another,  and 
who  was  pushing  a  chancery  suit  to  perfect  his  title,  it  was 
held  that  the  question  whether  the  defect  was  material  should 
have  gone  to  the  jury.^] 

yond  that  were  immaterial."  Rockford  Ins.  Co.  v.  Nelson,  Sup.  Ct.  111.  2  Ins. 
L.  J.  341.  In  Catron  v.  Tennessee  Insurance  Companj-^,  6  Humph.  (Tenn. )  176, 
a  tenant  in  common  owning  one-half,  applied  for  insurance  in  these  words:  "I 
wish  a  furnace  and  forge  insured,"  without  anything  further  said,  or  required  to  be 
said,  about  the  title  or  interest  of  the  insured.  And  the  court  held  this  a  mis- 
representation as  to  the  interest,  which  avoided  the  policy.  But  neither  the  cases 
cited  and  relied  upon  by  the  court,  nor  any  others  that  we  have  been  able  to  find, 
support  so  extravagant  a  doctrine.  There  were  other  and  sufficient  grounds  for 
the  decision,  and  it  is  evident,  from  an  examination  of  the  opinion,  that  the  court 
were  penetrated,  if  not  influenced,  by  a  confident  belief  that  the  insured  set  fire 
to  his  own  property.  And  the  early  cases  in  the  Supreme  Court  of  the  United 
States  (Columbian  Ins.  Co.  v.  Lawrence,  2  Peters,  25 ;  s.  c.  10  id.  507  ;  and 
Carpenter  v.  Prov.  Wash.  Ins.  Co.,  16  id.  495),  ojiposed  to  the  doctrine  stated 
in  the  text,  have  not  received  the  approbation  of  the  State  courts.  Franklin 
Fire  Ins.  Co.  v.  Coat.es,  14  Md.  285.     And  see  §  285. 

1  [Dacey  v.  Agricultural  Ins.  Co.,  21  Hun,  83,  87.] 

2  [Pavey  v.  American  Ins.  Co.,  56  Wis.  221.] 

3  [Williams  V.  Buffalo  German  Ins.  Co.,  17  Fed.  Rep.  63 ;  12  Ins.  L.  J.  374.] 

588 


CH.  XIII.]  TITLE   AND   INCUMBRANCE.  [§  285 

§285.  Title;  Ownership;  Interest.  —  The  insured  is  not 
bound  to  state  the  nature  or  particulars  of  his  title,  unless 
they  are  inquired  about,  or  required  to  be  disclosed  by  the 
provisions  of  the  policy. ^  (a)  A  statement  that  he  is  the 
owner,  that  being  an  indefinite  term,  or  that  the  property  is 
his,  if  in  fact^  it  be  his  in  some  substantial  sense,  is  suffi- 
cient; as  where  the  property  insured  stands  upon  the  land 
of  another,  the  buildings  belonging  to  the  assured  ;2  or  has 

1  [Trade  Iiis.  Co.  v.  Barracliff,  45  N.  J.  543  ;  Guest  v.  Fire  Insurance  Co.,  66 
Mich.  98  ;  Castner  v.  Farmers'  Mut.  Fire  Ins.  Co.,  46  Mich.  15,  18.  Under  a 
general  policy  on  goods  the  assured  is  not  required  to  state  the  particular  inter- 
est or  proportion  of  interest  which  he  intends  to  have  insured.  He  may  recover 
according  to  his  interest.  Whether  it  be  a  distinct  or  an  undivided  share  can- 
not be  material.  Lawrence  v.  Van  Home,  1  Caines,  276,  284.  The  nature  of 
the  interest  of  the  assured  need  not  be  specified  in  the  policy  except  in  cases  of 
re-assurance,  and  insurance  by  the  holder  of  a  bottomry  or  respondentia  bond, 
and  insurance  on  freight,  profits,  and  commissions ;  and  even  these  cases  will 
not  be  exceptions  if  they  may  be  regarded  as  the  subject-matter  of  insurance, 
rather  than  the  interest  of  the  party  in  the  subject-matter.  White  i'.  Hudson 
River  Ins.  Co.,  7  How.  Pr.  341,  348.] 

2  [It  is  enough  if  the  title  is  actually  good,  though  apparently  defective  on 
the  records.     Lockwood  v.  Middlesex  Mut.  Ass.  Co.,  47  Conn.  553.] 

*  Curry  r.  Commonwealth  Ins.  Co.,  10  Pick.  (Mass.)  535;  Fletcher  v.  Com- 
monwealth Ins.  Co.,  18  id.  419;  Morrison  v.  Tenn.  Mar.  &  Fire  Ins.  Co.,  18  Mo. 
262  ;  Sussex  County  Mut.  Ins.  Co.  v.  Woodruff,  2  Dutch.  (N.  J.)  541  ;  Hopkins 
V.  Provincial  Ins.  Co.,  18  U.  C.  (C.  P.)  74  ;  Sinclair  v.  Canadian,  &c.  Ins.  Co.,  40 
U.  C.  (Q.  B.)  206,  211.  [Where  the  owner  of  property  on  which  there  was  in- 
surance, sold  the  land,  retaining  the  buildings,  and  took  out  new  insurance  on 

(a)   In    general,   when   there   is    no  in  an  application  for  a  fire  policy  are 

fraudulent  intent,  the  assured's  neglect  usually  treated  as  warranties.     Stevens 

to  disclose  and  define  incumbrances  or  v.  Queen  Ins.  Co.,  81  Wis.  335  ;  West- 

his  interest,  beyond  what  he  is  asked  Chester  F.  Ins.   Co.  v.  Weaver,  70  Md. 

about,  in  the  property,  does  not  invali-  536  ;  Cerys  r.  State  Ins.  Co.,  71  Minn, 

date  the   policy.     Hall   v.    Niagara  F.  338  ;     German -American    ins.     Co.    v. 

Ins.    Co.,  93  Mich.   184  ;  Cross  v.   Na-  Hart,  43  Neb.    441  ;  State  Ins.   Co.  v. 

tional    F.    Ins.    Co.,    132   N.   Y.   133  ;  Gray,  44  Kansas,    731  ;  Morris  v.  Im- 

Dooly  V.  Hanover  F.  Ins.  Co.,  16  Wash,  perial  Ins.  Co.,  106  Ga.  461. 
155  ;  Seal  v.  Farmers'  Ins.  Co.  (Neb.),  As  to  the  agent's  consent  to  transfer 

80   N.  W.   807  ;  Koshland  v.  Hartford  of  title,  see  St.  Onge  v.  Westchester  F. 

F.  Ins.  Co.,  31  Oregon,  402  ;  Morotock  Ins.  Co.,  80  Fed.  Rep.  703  ;  Graham  v. 

Ins.  Co.   V.  Rodefer,  92  Va.  747;   Hart  American   F.   Ins.   Co.,   48   S.   C.   195. 

V.  Niagara  F.   Ins.   Co.,  9  Wash.  620  ;  If  the  agent  knowingly  writes  in  the 

Knop    V.   National    F.    Ins.    Co.,    101  application  false    answers   as    to    title 

Mich.  359  ;  German  Ins.  Inst'n  j;.  Kline,  when  the  truth  is  told,  the  insurer  is 

44  Neb.  395  ;  Queen  Ins.  Co.  v.  Kline  liable.     Creed  v.  Sun  Fire  Office,    101 

(Ky. ),  25  Ins.  L.  J.  236.  But  actual  rep-  Ala.  522. 
resentations  made  as  to  incumbrances 

589 


§  285]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.         [CH.  XIII. 

been  seized  on  execution  ;i  or  the  insured  is  tenant  for 
years  ;^  or  there  is  an  outstanding  agreement  to  sell,^  or  a 
parol  agreement  to  purchase,  upon  which  a  portion  of  the 
purchase-money  has  been  advanced;*  or  the  insured  is  a 
joint  owner,  in  which  case  he  may  recover  to  the  extent  of 
his  interest,^  especially  if  his  copartner  be  only  interested  in 
the  profits.^  The  interest  of  the  partner  in  such  a  case,  who 
in  fact  owns  the  stock  of  goods,  is  an  absolute  equitable  in- 
terest, and  is  protected  by  a  policy  which  is  to  be  void  if  the 
interest  of  the  insured  be  not  an  absolute  one.'  So  where 
the  insured,  in  reply  to  a  question,  —  the  policy  containing 
no  stipulation  as  to  disclosure  of  title,  —  answered  that  the 
land  on  which  the  insured  building  stood  was  hers,  when  in 
fact  she  had  only  a  life-estate  therein,  but  her  husband's 
will  had  made  no  disposition  of  the  remainder,  and  the 
heirs,  during  the  twelve  years  which  had  passed  since  the 
probate  of  the  will,  had  made  no  claim  to  the  property,   it 

them  without  saying  anything  about  the  change  of  title  to  the  land,  and  being 
asked  no  questions  about  the  land  title,  it  was  held  that  there  was  no  conceal- 
ment. It  was  the  carelessness  of  tlie  company  if  it  did  not  make  specific  in(iui- 
ries  about  such  a  matter.  Washington  Mills  Manuf.  Co.  v.  Weymouth  Ins.  Co., 
13.5  Mass.  505.] 

1  Strong  V.  Manufacturers'  Ins.  Co.,  10  Pick.  (Mass.)  40. 

2  Niblo  V.  North  American  Ins.  Co.,  I  Sand.  (N.  Y.  Sup.  Ct.)  551  ;  Sauvey  v. 
Isolated  Ins.  Co.,  U.  C.  (Q.  B.),  16  Can.  L.  J.  30  (1880).  In  Crockford  v.  Lon.  & 
Liverpool  Fire  Ins.  Co.,  5  Allen  (N.B.),  152,  it  appeared  that  the  plaintiff,  the  ten- 
ant of  a  lessee,  had  an  agreement  with  his  landlord  for  an  assignment  of  the  lease, 
which,  however,  had,  before  the  insurance  was  effected,  been  assigned  to  another 
person.  It  was  held  that  the  plaintiff  was  at  most  a  tenant  from  year  to  year, 
and  not  an  owner  in  such  a  sense  as  the  policy  contemplated. 

3  Davis  V.  Quincy  Mut.  Fire  Ins.  Co.,  10  Allen  (Mass.),  113;  Dohn  v.  Farm- 
ers' Joint  Stock  Ins.  Co.,  5  Lans.  (N.  Y.)  275  ;  Lorillard  Fire  Ins.  Co.  v.  Mc- 
CuUoch,  21  Ohio  St.  176;  Laidlaw  v.  Liverpool,  &c.  Ins.  Co.  (U.  C),  13  Grant, 
Ch.  377  ;  Bonham  v.  Iowa,  &c.  Ins.  Co.,  25  Iowa,  328.  Where  there  is  an  out- 
standing tax-title  in  litigation,  qucere.  Hurd  v.  St.  Paul,  &c.  Ins.  Co.,  39  ]\Iicli. 
443. 

4  Brogden  v.  Manufacturers',  &c.  Ins.  Co.,  U.  C.  (C.  P.)  15  Can.  L.  J.  31 
(1879). 

5  Hartford  Prot.  Ins.  Co.  v.  Harmer,  2  Ohio  St.  452.  And  see  also  Peck  v. 
New  London  Mnt.  Ins.  Co.,  22  Conn.  575. 

6  Irving  V.  Excelsior  Fire  Ins.  Co.,  1  Bosw.  (N.  Y.  Superior  Ct. )  507.  [A 
part-owner  may  insure  his  individual  interest  without  specifying  that  interest. 
Turner  v.  Burrows,  5  Wend.  541,  546.] 

■^  Ibid.  And  see  also  Collins  v.  Charlestown  Mut.  Fire  Ins.  Co.,  10  Gray 
(Mass.),  155  ;  Gould  v.  York  County  Mut.  Ins.  Co.,  47  Me,  403. 

590 


CH.  Xlli.]  TITLE    AND    INCUMBRANCE.  [§  285 

was  held  that  the  answer  was  substantially  true.^  So  if  the 
insured  is  in  possession  of  a  house  under  an  executory  con- 
tract on  which  part  payment  has  been  made,  or  which  can 
be  enforced  in  equity.^  So  if  the  insured  be  in  possession 
in  right  of  his  wife,  under  a  verbal  agreement  that  upon  cer- 
tain conditions  —  part  already  executed  —  he  shall  have  the 
legal  title. ^  And  a  conveyance  by  the  owner  to  a  fictitious 
person,  with  a  reconveyance  in  the  name  of  the  fictitious  per- 
son to  the  owner,  leaves  the  title  in  the  owner.'*  And  he 
may  describe  himself  as  owner  who,  as  cestui  que  trust,  can 
enforce  his  title  in  equity.^  But  a  mere  promise  by  a  pur- 
chaser, at  a  sale  on  execution,  to  reconvey  on  the  payment 
of  the  purchase-money,  there  being  no  promise  on  the  part 
of  the  execution  debtor  to  pay,  nor  other  consideration,  will 
not  support  a  representation  that  the  property  is  the  appli- 
cant's.^ If  the  insurer  be  the  owner  of  an  equity  of  re- 
demption,  it  is  likewise   sufficient;'' («)  since  an  equity  of 

1  Allen  V.  Charlestovvn  Mat.  Fire  Ins.  Co.,  5  Gray  (Mass.),  384. 

2  iEtiia  Ins.  Co.  v.  Tyler,  16  Wend.  (N.  Y.)  385  ;  s.  c.  12  Ind.  507  ;  Franklin 
Fire  Ins.  Co.  v.  Martin  (N.  J.)  8  Ins.  L.  J.  135  ;  Ramsay  v.  Phcpnix  Ins.  Co.,  C. 
Ct.  (N.  Y.),  2  Fed.  Rep.  429  ;  Dohn  v.  Farmers'  Ins.  Co.,  5  Lans.  (N.  Y.)  275. 

3  Farmers'  Ins.  Co.  v.  Fogleman,  38  Mich.  481  ;  Southern  Ins.  Co.  v.  Lewis, 
42  Ga.  587. 

*  David  V.  Williamsburgh,  &e.  Ins.  Co.  (N.  Y.),  10  Ins.  L.  J.  150. 

5  Newman  v.  Springfield  Ins.  Co.,  17  Minn.  123.  [An  equitable  interest  is 
enough  to  sustain  a  recital  of  ownership.  Guest  v.  Fire  Insurance  Co.,  66  Mich. 
98.  Such  a  statement  is  not  a  material  misrepresentation.  Dohn  v.  Farmers' 
Joint  Stock  Ins.  Co.,  5  Lans.  275,  279.  The  equitable  ownership  is  equivalent 
to  the  fee,  for  the  purposes  of  insurance,  and  where  the  equitable  owner  repre- 
sents that  the  title  was  in  her  name,  the  company  will  not  be  allowed  to  defend 
on  that  ground.  Pennsylvania  Fire  Ins.  Co.  7;.  Dougherty,  102  Pa.  St.  568. 
When  A,  described  the  insured  property  as  his,  when  in  fact  previous  to  the  in- 
surance he  had  conveyed  it  to  B.  by  a  warranty  deed,  B.  giving  a  defeasance  deed 
in  return,  which  latter  had  not  been  recorded,  the  policy  was  held  good.  Walsh 
V.  Philadelphia  Fire  Ass.,  127  Mass.  383,  385.  In  the  absence  of  express  in- 
quiry, the  interest  of  the  insured  as  equitable  owner  upon  whom  the  whole  loss 
must  fall,  was  sufficient.] 

f  Mers  V.  Franklin  Ins.  Co.,  68  Mo.  127. 

"^  [A  mortgagor  on  whose  property  the  mortgage  had  been  foreclosed,  but  the 
period  of  redemption  had  not  expired,  took  out  insurance  without  any  written 
application,  or  any  statement  of  the  condition  of  his  title,  and  it  was  held  that  in 
the  absence  of  fraud  the  insurance  of  the  property  as  his  own  was  valid.  It 
was  otherwise  with  a  policy  issued  after  the  redemption  expired.  Essex  Savings 
Bank  v.  Meriden  Ins.  Co.,  57  Conn.  335.] 

(a)  See  infra,  §  449,  new  note. 

_  591 


§  286]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.       [CH.  XIII. 

redemption  is  a  right,  and  is  a  real  interest  in  the  land, 
created  and  secured  by  the  law,  to  which  a  lien  will  attach, 
so  that  when  the  insured  states  the  property  in  his  posses- 
sion to  be  his,  he  sufficiently  states  the  true  title,  in  the 
absence  of  specific  inquiries. i  And  though  the  vendor  makes 
out  a  bill  of  sale  of  personal  property,  and  receives  a  note 
secured  by  a  mortgage  in  consideration  for  the  sale,  if  tliere 
be  no  delivery  of  the  bill  of  sale,  the  property  will  not 
thereby  be  devested  out  of  the  vendor,  so  that  a  warranty 
that  the  property  is  his  will  be  broken. 2  [Where  the  prop- 
erty had  been  deeded  to  the  insured  and  the  deed  left  with  a 
third  person  to  be  delivered  to  the  insured,  but  was  not  so 
delivered  till  after  the  fire,  it  was  held  that  she  was  the 
owner. ^  A  sheriff's  sale  afterward  annulled  will  not  affect 
the  title  of  the  insured,  nor  his  right  to  claim  under  a  pol- 
icy obtained  by  him  as  owner  after  such  sale  of  his  land  and 
before  it  was  set  aside.  ^] 

§  286.  Mortgagor  of  Personal  Property.  —  And  it  is  also 
held  that  the  mortgagor  of  chattels  is  the  "  sole  and  uncon- 
ditional owner"  of  the  mortgaged  property.^ 

1  Buffum  0.  Bowditch  Mut.  Fire  Ins.  Co.,  10  Gush.  (Mass.)  540  ;  Washington 
Ins.  Co.  V.  Kelley,  32  Md.  421  ;  Kronk  v.  Birmingham  Ins.  Co.  (Pa.),  9  Ins.  L.  J. 
26. 

2  Vogel  V.  People's  Mut.  Fire  Ins.  Co.,  9  Gray  (Mass.),  23. 
8  [Mattocks  V.  Des  Moines  Ins.  Co.,  74  Iowa,  233.] 

*  [Kearman  v.  Gouhl,  42  N.  J.  Eq.  4.] 

5  Huhhard  et  al.  v.  Hartford  Fire  Ins.  Co.,  33  Iowa,  325.  But  Miller,  J.,  in 
his  dissenting  opinion  in  this  case,  takes  a  distinction  between  mortgages  of 
real  and  mortgages  of  personal  property,  based  upon  the  statute,  which,  as  the 
statutes  of  other  States  may  have  similar  provisions,  it  may  be  of  importance  to 
note.  "  Without  stopping  to  inquire,"  says  the  learned  judge,  "  into  the  rights 
of  mortgagors  at  common  law,  it  is  sufficient  to  show  that  by  our  statute,  in  the 
absence  of  stipulations  to  the  contrary,  the  mortgagor  of  real  property  retains  the 
legal  title  and  right  of  possession  thereof,  but  in  the  case  of  personal  property,  the 
mortgagee  holds  that  title  and  right.  Here  the  statute  confers  the  title  and  the 
rights  of  possession  on  the  mortgagee  of  chattels,  the  mortgagor  having  a  naked 
equity  of  redemption,  a  mere  right  to  defeat  the  title  of  the  mortgagee  by  a  per- 
formance of  the  condition  of  the  mortgage,  and  on  a  failure  to  comply  with  those 
conditions  the  mortgagee  becomes  the  absolute  owner.  Bean  v.  Barney,  Scott 
&  Co.,  10  Iowa,  498.  The  mortgagor  of  personal  property  is  so  far  from  having 
any  ownership  in  the  goods  covered  by  the  mortgage,  that  he  has  no  interest 
therein  which  can  be  levied  upon  and  sold  under  execution  ;  unless  by  the  terms 
of  the  mortgage,  he  is  entitled  to,  and  in  fact  retains,  the  possession.  Campbell  v. 
Leonard,  11  Iowa,  489;  Rindskoff  Bros.  &  Co.  v.  Lyman,  16  id.  260.     In  what 

592 


CH.  XIII.]  TITLE   AND    INCUMBRANCE.  [§  287 

§  "287.  True  Title ;  Entire,  Unconditional,  and  Sole  Owner- 
ship,—  If,  however,  the  "true  title  "  is  called  for,  — and  this 
is  generally  the  case  in  mutual  insurance  companies,  as  the 
lien  which  they  rely  upon  as  security  depends  upon  the  title, 
—  a  failure  to  set  forth  the  title  with  substantial  accuracy 
will  amount  to  a  misrepresentation  or  a  concealment,  as  the 
case  may  be :  ^  as  where  the  insured  describes  the  property 
as  his  when  he  has  only  a  bond  for  a  deed ;  ^  or  is  a  stock- 
holder in  a  corporation  which  owns  the  property  ;2  or  is 
only  a  tenant  by  the  curtesy;^  or  a  lessee  with  or  without 
an  agreement  for  purchase;^  or  the  assignee  of  a  lessee  with 
right  to  purchase ;  ^  or  a  mortgagee ;  ^  or  has  only  an  imper- 
fect tax  title  ;^  or  for  the  purpose  of  defrauding  his  creditors, 
has  conveyed  away  his  estate,  without  consideration,  to  an- 
other, who  promises  to  reconvey  upon  request;^  or  is  the 
owner  of  only  one  of  seven  parcels  of  the  property  insured.^*' 
One  who  holds  as  trustee  under  a  will  has  not  an  "  absolute 
title."  11    In  such  case  the  policy  will  not  cover  even  that  the 

sense,  then,  can  it  be  said  that  the  mortgagor  of  personal  property  is  '  con- 
sidered the  owner '  ?  None  whatever  ;  much  less  can  it  be  maintained  that  he  is 
the  '  sole  and  unconditional  owner.' 

1  [If  the  policy  does  not  require  a  statement  of  title,  a  misrepresentation  will 
not  be  fatal  that  does  not  diminish  the  risk  or  lower  the  premium,  but  if  the  pol- 
icy re(;[uire  the  true  title,  a  failure  to  state  the  truth  vitiates  the  contract.  Ad- 
ema  v.  Insurance  Co.,  36  La.  An.  660.] 

2  Smith  V.  Bowditch  Mut.  Ins.  Co.,  6  Cash.  (Mass.),  448  ;  Brown  v.  Williams, 
28  Me.  252  ;  Falis  v.  Conway  Mut.  Fire  Ins.  Co.,  7  Allen  (Mass.)  46  ;  Birming- 
ham V.  Empire  Ins.  Co.,  42  Barb.  (N.  Y.)  457. 

3  Philips  V.  Knox  County  Mut.  Ins.  Co.,  20  Ohio,  174  ;  Abbott  v.  Shawmut 
Mut.  Fire  Ins.  Co.,  3  Allen  (Mass.),  213.  [The  insured  is  not  sole  owner  of 
goods  belonging  to  a  company  of  which  he  is  a  stockholder,  and  which  are  held 
by  him  as  security  for  advances  to  the  corporation.  McCormick  v.  Springfield 
Fire  &  Mar.  Ins.  Co.,  66  Cal.  361.] 

*  Leathers  v.  Insurance  Co.,  4  Fost.  (N.  H.)  259  ;  Eminence  Mut.  Ins.  Co.  v. 
Jesse,  1  Met,  (Ky.)  523. 

s  Shaw  V.  St.  Lawrence  County  Mut.  Ins.  Co.,  11  U,  C.  (Q.  B.)  73;  Marshall 
i;.  Columbian  Mut.  Ins.  Co.,  7  Fost.  (N.  H.)  157. 

6  Walroth  v.  St.  Lawrence  County  Mut.  Ins.  Co.,  10  U.  C.  (Q.B.)  525. 

7  Jenkins  v.  Quincy  Mut.  Fire  Ins.  Co.,  7  Gray  (Mass.),  370  ;  Brown  v.  Gore 
Dist.  Mat.  Ins.  Co.,  10  U.  C.  (Q.  B.)  353. 

8  Pinkhara  v.  Morang,  40  Me.  587. 

9  Treadway  v.  Hamilton  Mut.  Ins.  Co.,  29  Conn.  68. 
i«  Day  V.  Charter  Oak  Fire  &  Mar.  Ins.  Co.,. 51  Me.  91. 

"  Murphrey  v.  Old  Dominion  Ins.  Co.,  C.  Ct.  (N.  C.)  5  Ins.  L.J.  297. 
VOL.  I.  — 38  593 


§  287]  INSURANCE  :   FIRE,   LIFE,   ACCIDENT,    ETC.         [CH.  XIII 

title  to  which  is  truly  represented. ^  [The  omission  to  state 
the  true  title  amounts  to  a  warranty  of  such  title  as  the 
charter  of  the  company  requires.  The  extent  of  the  as- 
sured's  interest  is  always  considered  by  the  insurers,  and  if 
the  estate  be  less  than  an  unincumbered  fee  simple  it  should 
be  disclosed. 2]  If,  hotvever,  the  polict/  of  a  mutual  insurance 
company,  whose  charter  gives  a  lien  upon  real  estate,  does 
not  call  specifically/  for  the  true  title,  no  description  of  the 
title  need  be  given.  A  general  answer  that  the  property  be- 
longs to  the  insured,  or  to  that  effect,  is  sufficient.^  And  in 
Clapp  V.  Union  Mutual  Insurance  Company,*  a  judgment 
creditor,  to  whom  the  insured  property  had  been  set  off  on 
execution,  subject  to  two  mortgages  to  other  parties,  and  to 
the  debtor's  unexpired  equity  of  redemption,  was  held  not 
to  have  misrepresented  his  title  and  interest  in  stating  the 
property  to  be  his  own.  In  like  manner,  in  Chase  v.  Hamil- 
ton Mutual  Insurance  Company, ^  the  insured,  who  had  been 
in  possession  of  the  land  several  years  under  an  executory 
agreement  for  the  p)urchase  thereof,  and  had  erected  thereon 
the  building  insured,  and  before  the  application  for  insur- 
ance had  paid  all  the  purchase -money,  though  he  had  not 
then  taken  the  legal  title,  was  held  to  have  stated  his  "  true 
title  and  interest,"  in  representing  the  house  and  land  to  be 
his.  So  where  the  purchase  was  at  a  sale  under  foreclosure 
of  a  mortgage,  and  the  property  was  destroyed  before  the 
deed  was  passed,  it  was  held  that  when  the  deed  was  passed 
it  took  effect  as  of  the  day  of  the  sale,  and  that  the  insured 
then  had  the  legal  title,  subject  to  an  equity  of  redemption, 
and  truly  answered  that  they  were  the  owners.^     [A  pur- 

»  "Wilbur  V.  Bowditch  Mut.  Fire  Ins.  Co.,  10  Ciish.  (Mass.)  446. 

2  [Illinois  Mut.  Ins.  Co.  v.  Marseilles  Manuf.  Co.,  6  111.  236,  267-268.] 

3  Allen  V.  Mut.  Fire  Ins.  Co.,  2  Md.  111.  In  this  case  the  title  was  in  point 
of  fact  such  as  to  give  a  lien.  Allen  v.  Charle-stown  Mut.  Fire  Ins.  Co.,  5  Gray 
(Mass.),  384.  In  this  case  the  title  was  a  life-estate  under  a  will,  subject  to  con- 
tingent possible  reduction  to  an  estate  in  dower.  Sussex  County  Mut.  Ins.  Co. 
V.  Woodruff,  2  Dutch.  (N.  J.)  541.  Contra,  Mutual  Ass.  Co.  i;.  Mahon,  5  Call 
(Va.),  517  ;  Mutual  Ins.  Co.  v.  Deale,  18  Md.  26. 

4  7  Fost.  (N.  H.)  143. 
«  22  Barb.  (N.  Y.)  527. 

^  Gaylord  v,  Lamar  Fire  Ins.  Co.,  40  Mo.  13. 

594 


CH.  XIII.]  TITLE   AND   INCUMBRANCE.  [§  287 

chaser  at  a  sheriff's  sale  before  acknowledgment  of  the  deed, 
applied  for  insurance,  stating  that  he  owned  the  premises, 
and  it  was  held  no  such  misstatement  as  to  avoid  the  pol- 
icy.^] An  answer  to  a  question  as  to  incumbrances,  stating 
that  the  applicant,  a  mortgagee  in  possession,  was  first  mort- 
gagee, taken  together  with  the  fact  that  the  application  was 
for  insurance  on  "dwelling-house,"  not  stated  to  be  the 
applicant's,  is  a  sufficient  statement  of  the  "true  title"  of 
the  insured. 2  And  a  description  of  the  insured  as  mort- 
sagees  is  a  sufficient  statement  of  the  interest  of  the  insured, 
under  a  provision  that  if  the  interest  of  the  insured  be  "  any- 
other  than  the  entire,  unconditional,  and  sole  ownership  of 
the  property  for  the  use  and  benefit  of  the  insured,"  it  must  be 
so  expressed  in  the  written  part  of  the  policy,  and  is  a  true 
statement  of  their  interest  as  "mortgagee  or  otherwise. "^ 
So  a  vendee  in  possession  after  part  payment,  there  being  no 
outstanding  lien  or  incumbrance,  though  he  has  not  received 
his  deed,  has  such  an  ownership.*  So  where  two  agree  to 
carry  on  a  cotton  plantation,  one  to  furnish  stock,  money, 
and  supplies,  the  other  to  furnish  the  plantation  and  to 
superintend  the  business;  the  former  to  be  indemnified  for 
his  advances  out  of  the  proceeds  of  the  cotton,  and  the  stock 
and  implements  used  to  be  equally  divided  at  the  end  of  the 
year,  it  was  held  that,  the  cotton  not  being  worth  enough  to 
pay  the  advances,  the  partner  who  had  made  them  was  the 
sole  and  unconditional  owner  of  the  cotton,  but  not  of  the 
stock  and  implements.^  In  some  States,  the  mortgagor  in 
possession  is  the  owner  of  the  fee,  and  when  his  estate  is  in 
fee-simple,  and  there  is  no  joint  tenancy,  he  has  the  sole, 
entire,  and  unconditional  ownership.^     And  where  the  prop- 

1  [Susquehanna  Mut.  Fire  Ins.  Co.  v.  Staats,  102  Pa.  St.  529.] 

2  Wynian  v.  People's  Equity  Ins.  Co.,  1  Allen  (Mass.),  301. 

3  "Williams  v.  Koger  Williams  Ins.  Co.,  107  Mass.  377. 

"»  Bonham  v.  Iowa,  &e.  Ins.  Co.,  25  Iowa,  328  ;  Insurance  Co.  v.  Wilgus,  7  W. 
N.  C.  (Pa.)  24;  Hinman  v.   Hartford  Fire  Ins.  Co.,  36  Wis.  159  ;    Kamsej'  v. 
'  Phojnix  Ins.  Co.,  C.  Ct.  (N.  Y.),  2  Fed.  Rep.  429. 

5  Noyes  v.  Hartford  Fire  Ins.  Co.,  54  N.  Y.  668. 

6  DolUver  v.  St.  Joseph,  &c.  Ins.  Co.,  128  Mass.  315  ;  Clay,  &c.  Ins.  Co.  v. 
Beck,  43  Md.  358  ;  Washington  Ins.  Co.  v.  Kelly,  32  id.  421  ;  Manhattan  Ins. 
Co.  V.  Barker,  7  Heisk.  (Tenn.)  503  ;  Insurance  -Co.  v.  Haven,  95  U.  S.  242.  As 
to  mortgagor  of  personal  property,  see  j^ost,  §  286. 

595 


§  287]  INSURANCE  :    riKE,   LIFE,   ACCIDENT,    ETC.        [CH.  XIII. 

erty  belonged  to  a  corporation,  but  the  record  title  was  in 
fact  in  the  name  of  an  individual  corporator,  who  held  for 
the  corporation,  the  latter  was  held  to  be  "entire,  unquali- 
fied, and  sole  owner,"  within  the  meaning  of  the  contract. ^ 
Such  ownership  is  entirely  consistent  with  outstanding  liens 
and  incumbrances. 2  When  the  policy  required  that  if  the 
"  interest "  was  other  than  the  "  entire,  unconditional,  and 
sole  ownership,"  it  must  be  so  expressed  in  the  "written 
part "  of  the  policy,  it  was  held  that  an  outstanding  mort- 
gage ought  to  have  been  declared  and  inserted  in  the  policy. ^ 
But  a  purchaser  at  sheriff's  sale,  no  purchase-money  having 
been  paid,  and  there  being  an  outstanding  right  to  claim  the 
premises,  has  not  such  an  ownership ;  *  nor  a  tenant  in  pos- 
session under  a  partly  executed  agreement  to  purchase,  there 
being  an  outstanding  tax-title;^  nor  has  the  holder  of  a  mere 
legal  title,  while  the  equitable  estate  and  interest  and  the 
right  to  be  immediately  invested  with  the  legal  title  are  in 
another.^  Where  the  use  of  real  estate  is  contributed  as  a 
partner's  share  of  the  capital,  there  being  no  deed,  directly 
or  in  trust,  the  firm  cannot  truly  describe  the  property  as 
"theirs,"  nor  have  they  an  entire,  unconditional,  and  sole 
ownership.''  And  a  mortgage  must  be  disclosed  where  the 
"true  title  and  interest"  are  required. ^     [If  the  policy  is  to 

1  American  Basket  Co.  v.  Farmville  Ins.  Co.,  C.  Ct.  (Va.),  8  Ins.  L.  J.  331. 
See  also  Quarrier  v.  Insurance  Co.,  10  W.  Va.  507. 

2  Manhattan  Fire  Ins.  Co.  v.  Weill,  28  Grat.  (Va.)  389. 

3  McLeod  V.  Citizens'  Ins.  Co.,  3  R.  &  C.  (Nova  Scotia)  156. 
*  Security  Ins.  Co.  r.  Bronger,  6  Bush  (Ky.),  146. 

5  Hinman  v.  Hartford  Fire  Ins.  Co.,  36  Wis.  159. 

6  Clay  Ins.  Co.  v.  Huron,  &c.  Co.,  31  Mich.   346;  Farmers'  &c.  Ins.  Co.   v. 
Curry,  13  Bush  (Ky.),  312. 

7  Citizens'  Ins.  Co.  v.  Doll,  35  Md.  89. 

8  Bowditch  Mut.  Fire  Ins.  Co.  v.  Winslow,  3  Gray  (Mass.),  415  ;  s.  c.  8  id.  38. 
The  ])laintiff  had  lived  with  his  father  for  about  thirty-seven  years  on  land  be- 
longing to  the  town.  A  barn  had  been  built  on  it,  resting  upon  abutments  of 
loose  stones,  which  the  plaintiff,  in  October,  1867,  insured  with  defendants.  In 
December,  1867,  a  patent  issued  to  one  F.,  and  in  June,  1869,  S.,  claiming  • 
through  the  patentee,  recovered  judgment  in  ejectment  against  the  plaintiff  and 
his  father,  and  placed  a  hab.  fac.  in  the  sheriff's  hands.  A  few  days  after,  and 
before  it  had  been  executed,  the  barn  was  burned.  Proceedings  in  chancery 
were  then  pending  by  the  plaintiff,  contesting  the  claim  of  S.  The  policy  re- 
quired that  the  plaintiff  in  his  account  of  the  loss  should  show  the  true  state  of  his 

596 


CH.  XIII.]  TITLE   AND    INCUMBRANCE.  [§  287  B 

be  void  when  the  interest  of  the  insured  as  owner,  trustee, 
consignee,  mortgagee,  &c.,  is  not  truly  stated,  the  failure  to 
disclose  a  mortgage  is  fatal.  A  mortgage  may  be  very  ma- 
terial to  the  underwriter.  The  interest  of  the  assured  in 
property  mortgaged  to  many  times  its  value  is  hardly  equal 
to  that  of  an  absolute  owner,  especially  if  the  mortgagor  has 
nothing  else  with  which  to  pay  his  debts.^  JJ.  Miller  and 
Irving  dissented  on  the  ground  that  in  the  enumeration  of 
the  policy,  a  mortgagee  was  mentioned  as  bound  to  disclose 
the  particular  state  of  his  interest,  but  not  a  mortgagor,  and 
that  the  insertion  of  one  word  and  omission  of  the  other  Avas 
strong  evidence  of  an  intent  to  exclude  mortgagors  from  the 
clause,  except  as  they  come  under  the  word  "  owner."  When 
one  takes  as  his  trade  name  "National  Slipper  Co."  and  in- 
sures in  that  name  bona  fide,  it  is  not  a  breach  of  the  con- 
dition to  truly  state  the  interest,  and  an  action  thereon  can 
be  maintained. 2  The  belief  of  the  company  that  it  was  in- 
suring a  corporation  is  immaterial.] 

[§  287  A.  A  condition  that  if  the  insured  is  not  the  sole, 
entire,  and  unconditional  owner  the  policy  shall  be  void  is 
reasonable  and  valid, ^  and  violation  of  it  will  prevent  recov- 
ery.^ And  failure  to  disclose  the  real  state  of  the  title  if 
not  sole,  &c.  will  be  fatal  although  the  insured  was  not  ques- 
tioned as  to  that  fact.^] 

[§  287  B.  When  the  conditions  require  the  applicant  to 
have  the  "  entire,  unconditional,  and  sole  ownership  "  a  pol- 

title  at  the  time  of  the  fire  ;  and  the  plaintiff  in  such  account  stated  that  he  was 
bona  fide  owner,  and  that  his  title  was  by  possession  for  thirty  years  by  himself 
and  his  father.  Held,  that  the  account  did  not  give  a  true  statement  of  plain- 
tiff's title  ;  that  the  barn  was  part  of  the  freehold  ;  and  that  he  could  not  recover. 
Wilson,  J.,  dissenting,  on  the  grounds  that  the  plaintiff,  being  in  possession,  and 
prosecuting  his  claim  in  equity,  had  an  insurable  interest ;  that  as  against  an 
adverse  claimant  he  might  treat  the  barn  as  a  chattel  which  he  could  remove  ; 
and  in  this  view  his  statement  of  title  was  correct.  Sherboneau  v.  Beaver  JIut. 
Fire  Ins.  Ass.,  30  IT.  C.  (Q.  B.)  472. 

1  [Westchester  Fire  Ins.  Co.  v.  Weaver,  70  Md.  536.] 

2  [Clark  V.  German  Mut.  Fire  Ins.  Co.,  7  JIo.  App.  77,  82.] 
;     3  [Barnard  v.  National  Fire  Ins.  Co.,  27  Mo.  App.  26.] 

*  [Farmville  Insurance,  &c.  Co.  v.  Butler,  55  Md.  233.] 
5  [Waller  v.  Northern  Ass.  Co.,  2  McCrary,  637,  611  ;  Reithmueller  v.  Fire 
Assurance,  20  Mo.  App.  246.] 

597 


§  287  B]      INSURANCE  :    FIRE,    LIFE,   ACCIDENT,   ETC.        [CH.  XIII. 


icy  issued  to  one  who  described  the  property  as  "  his  frame 
dwelling-house,"  when  his  only  title  was  under  a  quitclaim 
deed  from  a  second  mortgagee^  avoids  the  policy  under  the 
sole  ownership  clause.  1  If  the  policy  issued  to  the  insured 
describes  the  policy  as  A/s,  this  implies  sole  and  uncondi- 
tional ownership,  and  if  he  had  only  a  leasehold  in  the  real 
estate,  and  a  contract  for  purchase  of  the  personalty,  never 
"having  paid  the  price,  the  policy  is  avoided.  2  (a)     A  surviv- 

1  [Southwick  V.  Atlantic  Fire  &  Mar.  Iiis.  Co.,  133  Mass.  457.] 

2  [Brown  v.  Commercial  Fire  lus.  Co.,  86  Ala.  189.] 


(«)  Misrepresentations  as  to  the  in- 
sured's ownership  are  fatal  only  when 
fraudulent  or  material  to  the  risk. 
Kenton  Ins.  Co.  v.  Wigginton,  89  K}'. 
330  ;  Western  &  Atlantic  Pipe  Liner  v. 
Home  Ins.  Co.,  145  Fenn.  St.  346. 
Where  by  an  accident  policy  the  benefi- 
ciary was  warranted  to  be  the  assured's 
wife,  when  in  fact  she  was  his  mistress, 
<here  was  held  to  be  a  misrepresentation 
which  forfeited  the  policy.  Travelers' 
Ins.  Co.  V.  Lampkin,  5  Col.  App.  177. 
But  where  the  assured  in  good  fiiith 
had  his  life  policy  made  payable  to  his 
wife  Mary,  whom  he  had  married,  and 
with  whom  he  was  living,  she  was  held 
entitled  to  its  proceeds,  though  the 
marriage  was  void  because  he  was  not 
divorced  from  his  former  wife,  who  was  ■ 
still  living.  Overbeck  v.  Overbeck, 
155  Penn.  St.  5. 

An  assured  who  represents  himself  as 
"owner"  of  realty  is,  when  not  pressed 
for  accurate  information,  required  only 
to  show  an  insurable  interest.  Man- 
chester F.  Ass.  Co.  V.  Abrams,  89  Fed. 
Rep.  932  ;  Phoenix  Ins.  Co.  v.  Wilson 
(Ind.),  20  Ins.  L.  J.  73  ;  Phcenix  Ins. 
Co,  V.  Munger  Manuf.  Co.,  92  Texas, 
277  ;  Sisk  v.  Citizens'  Ins.  Co.,  16  Ind. 
App.  565;  Home  Ins.  Co.  ■«.  Mendenhall, 
168  111.  458  ;  Foley  v.  Manufacturers' 
F.  Ins.  Co.,  152  N.  Y.  131.  If,  in  his 
application  he  answers  merely  "deed" 
to  the  question  as  to  his  title,  this  does 
not  warrant  absolute  ownership  in  fee, 
as  his  deed  may  be  any  kind  of  a  deed. 
Clawson  v.  Citizens'  Mut.  F.   Ins.  Co., 

598 


(Mich.)  80  N.  W.  573.  See  Lindner  v. 
St.  Paul  F.  &  M.  Ins,  Co.,  93  Wis.  526  ; 
East  Texas  F.  Ins.  Co,  v.  Crawford 
(Texas;,  21  Ins.  L.  J.  39. 

"  Sole  and  unconditional  ownership  " 
is  satisfied,  as  a  requirement  of  the 
policy,  when  the  insured  is  the  actual 
and  substantial  owner,  though  his  title 
is  subject  to  restrictions,  or  his  power 
of  alienation  is  limited  :  Yo.st  v.  McKee, 
179  Penn.  St.  381  ;  but  not  by  a  part 
ownership.  Liverpool,  &c.  Ins.  Co.  v. 
Cochran  (Miss.),  29  Ins.  L.  J,  374.  A 
condition  re(iuiring  for  the  future  "  en- 
tire, unconditional,  unencumbered,  and 
sole  ownership"  has  been  held  not  to 
be  violated  by  a  written  contract  to 
convey.  Arkansas  F.  Ins.  Co.  v.  Wil- 
son (Ark.),  55  S.  W,  933  ;  see  14  Harv, 
L.  Rev,  157.  It  is  not  "sole  owner- 
ship "  to  possess  a  half  interest  in  the 
insured  propei-ty  and  a  contract  for  the 
purchase  of  the  other  half;  Liverpool, 
&c.,  Ins.  Co.  V.  Cochran  (Miss.),  26  So. 
932.  See  Clapp  v.  Farmers'  Mut.  F, 
Ins.  Ass'n  (N.C.),  29  Ins.  L.  J.  468  ;  or 
to  be  interested  in  realty  which,  when 
the  application  for  insurance  was  made, 
has  been  sold  under  the  foreclosure  of 
a  mortgage,  the  period  for  redeeming 
which  has  expired.  Planters'  Mut,  Ins. 
Co.  V.  Lloyd  (Ark.),  56  S.  W.  44. 

Policies  conditioned  on  "sole  and 
unconditional  ownership "  have  been 
held  valid  :  —  where  the  insured,  though 
equitably  owner,  and  entitled  by  bond 
to  the  benefits  of  the  property,  has  not 
paid  all  the  purchase  money,  nor  ob- 


CH.  XIII.]  TITLE   AND   INCUMBRANCE.  [§  287  B 

ing  partner  is  not  the  sole  and  unconditional  owner  of  the 


tained  a  deed,  but  has  fully  performed 
his  part  up  to  date,  and  holds  the  laud 
under  a  contract  providing  that  failure 
to   make   payments   when   due   should 
■work   a  forfeiture   of  all  rights  there- 
under ;  he  can  insure  for  the  payments 
made  :    see  Manchester  F.   Ins.  Co.  v. 
Abrams,  89  Fed.  Rep.  932,  934  ;  Priu- 
gle  V.   Des  Moines  Ins.  Co.,  107  Iowa, 
742  ;  Baker  v.  State  Ins.  Co.,  31  Ore- 
gon, 41  ;  Davis  v.  Phoenix  Ins.  Co.,  Ill 
Cal.  409  ;  Grable  v.   German  Ins.  Co., 
32  Neb.  645  ;  Loventhal  v.  Home  Ins. 
Co.,    112  Aln.  108;    Home  Ins.  Co.  v. 
Bethel,  142  III  537  :  where  a  husband 
insured,  as  his  own,   furniture  belong- 
ing  to  his  wife  before   their  marriage, 
the  law  of  their  residence  giving  to  him 
the  "  sole  management  and  control  of 
his  wife's  separate  property "  :  Georgia 
Home   Ins.    Co.    v.    Brady   (Tex.   Civ. 
App.),  41  S.  \V.   513  ;    where   the  in- 
sured was  in  possession  under  a  verbal 
contract  to  convey,  and  had  made  im- 
provements, although  the  policy  called 
both   for   sole   ownership   and   title   in 
fee-simple  :  Queen  Ins.  Co.  v.  May  (Tex. 
Civ.  App.),  35  S.  W.  829  ;  see  Liberty 
Ins.  Co.  V.  Boulden,  96  Ala.  508  ;  (Co-a- 
tra,  as  to  the  vendor  in  such  case :  Ham- 
ilton V.    Dwelling-House  Ins.    Co.,  98 
Mich.  535)  ;  where   the  grantor's   wife 
did  not  join  in  his  deed  to  the  insured  : 
Ohio  Farmers'  Ins.  Co.  v.  Bevis,  18  Ind. 
App.  17  ;  where  the  plaintiffs  advanced 
money    to   a   partnership    to    purchase 
grain,  and  held  warehouse   receipts   of 
the  firm  for  their  advances,  the  insur- 
ance  having   been   obtained   upon   the 
grain  as  the  property  of  one  member  of 
the  firm,  with  the  loss  payable  to  the 
plaintiffs  :  Traders'  Ins.  Co.  v.  Pacaud, 
150    111.  245  ;    see  also  Manchester  F. 
As.   Co.  V.  Abrams,  89  Fed.  Rep.  932  ; 
Westchester  F.  Ins.  Co.  v.  Wagner  (Tex. 
Civ.  App.),  26  Ins.  L.  J.  261  ;  Morotock 
Ins.  Co.  V.  Cheek,  93  Va.  8  ;  Traders' 
Ins.  Co.  V.  Pacaud,  150  111.  245  ;  Pelzer 
Manuf.  Co.  v.  Sun  Fire  Office  (S.  C),  21 
Ins.  L.  J.  952  :  where  a  deed  was  held 


in  escrow,  running  to  the  insured  who 
was  in  possession,  and   deliverable   on 
performance   of  a  condition  :  Davis  v. 
Pioneer  Furniture  Co.,   102  Wis.  394  ; 
where   the   two   persons    insured   were 
sole  owners  of  the  stock  of  a  corporation 
which  had  title  to  the  insured  property  : 
North  British  &  ^lercantile  Ins.  Co.  v. 
Bohn,  49  Neb.  572  ;  Syndicate  Ins.  Co. 
V.  Bohn,  65  Fed.  Rep.  165  ;  where  the 
insured  had  the  entire  beneficial  interest, 
but  the  naked  legal   title   was  in   his 
wife  :  McCoy  v.   Iowa   State  Ins.   Co., 
107  Iowa,  80  ;  where  the  husband  in- 
sured as  sole  owner,  but  his  wife  had  an 
equal   interest ;    Miotke    v.   Milwaukee 
Mechanics'  Ins.   Co.,   113   Mich.    166  ; 
Phenix   Ins.     Co.    v.   Angel  (Ky.),   26 
Ins.  L,  J.  722  ;  Schroedel  v.  Humboldt 
F.  Ins.  Co.  (Tenn.),  23  Id.  240  ;  DifFen- 
baugh  V.  Union  F.  Ins.  Co.,  150  Penn. 
St.    270 ;  Glaze   v.    Three   Rivers   Far- 
mers' Mut.  F.  Ins.  Co.,  87  Mich.  349  ; 
Pelican    Ins.    Co.    v.    Smith,    92   Ala. 
428  ;  German   Ins.   Co.  v.    Hynian,   34 
Neb.  704  ;  Trott  v.   Woolwich  j\Iut.  F. 
Ins.  Co.,  83  Maine,  362;  see  Graves  v. 
Merchants'    Ins.    Co.,    82    Iowa,    637  ; 
Webster   v.    DwoUing-House   Ins.  Co., 
53    Ohio    St.  558  :    where   by   mi.stake 
the  insured's  building  was  erected  chiefly 
on  his  own  lanrl,  but  also  partly  on  the 
street   and   partly   on   adjacent    land  : 
Haider  v.  St.   Paul  F.  &  M.  Ins.    Co., 
67  Minn,  514 ;  where  the  insured,  be- 
ing owner,  uses  another's  name  in  his 
business  :    Phcenix  Ins.  Co.  v.  McKer- 
nan  (Ky.),   27  Ins.  L.   J.  870;  or  the 
policy  is  issued  to  a  partnership  having 
i)ut  one  member,  and  this  is  known  to 
the  insurer's  agent.     In  re  Pelican  Ins. 
Co.,  47  La.  Ann.  935.     See  McFetridge 
V.  Phenix  Ins.  Co.,  84  Wis.  200. 

On  the  other  hand,  a  contract  of  sale 
which  passes  the '  equitable  title  and 
beneficial  interest  violates  a  policy  pro- 
vision against  change  of  title  or  posses- 
sion. Cottingham  v.  Fireman's  Fund 
Ins.  Co.,  90  Ky.  439.  Where  the  title 
under  a  contract  was  in   the  vendor, 

599 


§  287  C]        INSURANCE  :   FIRE,   LIFE,   ACCIDENT,   ETC.         [CH.  XIII. 

firm  goods.  ^  Warranting  that  he  has  the  sole  ownership 
when  he  really  has  only  a  life  estate  is  fatal  to  the  insured. ^j 
[§  287  C.  The  "entire  ownership"  clause  does  not  neces- 
sitate statement  of  a  mortgage.  If  the  company  desired  in- 
formation as  to  mortgages  they  should  have  used  language 
to  which  no  doubt  could  attach.^  A  mortgage  for  the  pur- 
chase-money or  a  lien  for  it  by  contract,  or  by  the  retention 
of  the  title  by  the  vendor  as  security,  does  not  affect  the 
risk  nor  prevent  the  insured  from  being  the  entire  and  sole 
owner.  The  equitable  owner  is  the  entire  and  sole  owner.* 
And  an  absolute  deed  intended  as  a  mortgage  does  not  falsify 
the  claim  of  sole  ownership.^  Entire  ownership  for  insur- 
ance is  not  prevented  by  a  lien,  or  a  conditional  sale,  the 
vendor  remaining  in  possession.  ^  A  warranty  of  sole  owner- 
ship is  not  broken  by  proof  of  the  pendency  of  an  action  not 
intended  to  question  the  ownership  but  only  to  establish  a 
lien.''     An  agreement  by  the  insured  with  W.  that  the  said 


1  [Crescent  Ins.  Co.  .  Camp,  64  Tex.  521  ;  Insurance  Co.  v.  Camp,  71  Tex. 
503.] 

2  [Gavver  v.  Hawkeye  Ins.  Co.,  69  Iowa,  202.] 

3  [Clay  Fire  &  Mar.  Stock  Ins.  Co.  v.  Beck,  43  Md.  358,  359  ;  Ellis  v.  In- 
surance Co.,  32  Fed.  Rep.  646  (Iowa),  1887  ;  Friezen  v.  Allemania  Fire  Ins.  Co., 
30  Fed.  Rep.  352  (Wis.)  1887.] 

*  [Insurance  Co.  Crockett,  7  Lea  (Tenn  ),  725,  729  ;  Millville  Mut.  Fire 
Ins.  Co.  V.  Wilgus,  88  Pa.  St.  107,  110.] 

5  [Dft  Armand  v.  Home  Ins.  Co.,  28  Fed.  Rep.  603  (Mich.)  1886.] 
^  [Carrigan  v.  Insurance  Co.,  53  Vt.  418.] 
'   [Lang  y.  Hawkeye  Ins.  Co.,  74  Iowa,  673.] 


and  the  vendee  was  in  possession,  the 
latter's  assignee  of  that  contract,  who 
holds  his  assignment  merely  as  a  pledge 
to  secure  him  for  moneys  advanced, 
thougli  having  an  insurable  interest,  is 
not  the  unconditional  and  sole  owner  of 
the  contract,  and  his  policy  as  such 
owner  is  void,  especially  if  his  interest  is 
less  than  the  insurance.  Gettelman  v. 
Commercial  Union  Ass.  Co.,  97  Wis.  237. 
So  an  assignment  for  creditors,  as  au- 
thorized by  a  State  statute,  avoids  the 
policy.  Orr  v.  Hanover  F.  Ins.  Co., 
158  111.  149.  Other  decisions  in  which 
the  above  clause  was  held  not  applicable 
are,  Williamson  v.  Orient  Ins.  Co.,  100 
600 


Ga.  791 ;  Manchester  F.  Ass.  Co.  v. 
Feibelman,  118  Ala.  308 ;  Cooper  v. 
Penn.  State  Ins.  Co.,  96  Wis.  362  ; 
Cushman  v.  New  England  F.  Ins.  Co., 
65  Vt.  569 ;  Phila.  Fire  Ass'n  v.  Fh)ur- 
noy,  84  Texas,  632  ;  Hall  v.  Niagara  F. 
Ins.  Co.,  93  Mich.  184  ;  Met'n  L.  Ins. 
Co.  V.  Anderson,  79  Md.  375.  See  fur- 
ther on  this  clause,  Carey  v.  Liverpool, 
&c.  Ins.  Co.,  92  Wis.  538  ;  Sun  Ins. 
Co.  V.  Greenville  B.  &  L.  Ass'n,  58 
N.  J.  L.  367  ;  Ins.  Co.  of  North  Ameri- 
ca y.  Johnson,  70  Fed.  Rep.  794;  Kella 
V.  Northwestern  Live-stock  Ins.  Co., 
64  Minn.  390. 


CH.  XIII.]  TITLE   AND   INCUMBRANCE.  [§  287  C 

W.  shall  have  a  share  in  the  profits  of  the  goods  insured  in 
consideration  of  certain  services,  does  not  prevent  the  in- 
sured from  having  the  "entire,  unconditional,  and  sole 
ownership"  of  the  goods  for  his  own  "use  and  benefit. "^ 
Where  the  insured  had  a  brother  who  was  claimed  to  be 
only  an  employee,  although  he  shared  in  the  profits  and 
losses,  and  the  business  was  in  the  name  of  plaintiff  "  and 
brother, "  and  the  proofs  represented  the  property  as  partner- 
ship goods,  the  evidence  was  given  to  the  jury  on  the  ques- 
tion of  no  partnership  and  consequent  sole  interest.  ^  One 
who  is  the  sole  beneficial  owner  of  property  is  the  sole  and 
absolute  owner  in  respect  to  insurance,  so  that  the  policy 
will  not  be  void  by  his  failure  to  state  the  equitable  charac- 
ter of  his  title. ^  The  equitable  owner  in  fee  is  the  sole  and 
unconditional  owner  in  respect  to  insurance.*  As  where  the 
naked  legal  title  is  in  A.  but  the  whole  beneficial  interest 
and  the  possession  are  in  B,,  B.  has  the  entire,  uncondi- 
tional, and  sole  ownership.^  One  who  has  the  exclusive  use 
and  enjoyment  of  property  without  any  assertion  of  an  ad- 
verse claim  by  any  other  person,  may  insure  as  sole  and 
unconditional  owner. ^  One  in  possession  under  a  valid  con- 
tract of  purchase  is  the  sole,  &c.  owner."  And  an  assign- 
ment of  a  contract  of  purchase  of  land  to  secure  a  debt  and 
future  advances  does  not  divest  the  assignor  of  the  "entire, 
unconditional,  and  sole  ownership  "  required  to  recover  on 
the  policy.^  But  mere  verbal  promises  without  consideration 
that  the  plaintiff  should  be  allowed  to  buy  such  interests  in 

1  [Boutelle  v.  Westchester  Five  Ins.  Co.,  51  Vt.  4.] 

2  [Pittsburgh  Ins.  Co.  v.  Frazee,  107  Pa.  St.  521.] 

3  [Lebanon  Mut.  Ins.  Co.  v.  Erb,  112  Pa.  St.  149.] 

4  [Imperial  Fire  Ins.  Co.  v.  Dunham,  117  Pa.  St.  460,  475  ;  Elliott  w.  Ashland 
Mut.  Fire  Ins.  Co.,  117  Pa.  St.  548.] 

6  [Martin  v.  State  Ins.  Co.,  44  N.  J.  485  ;  "Watertown  Fire  Ins.  Co.  v.  Simons, 
96  Pa.  St.  520,  522,  527.] 

6  [Miller  v.  Alliance  Ins.  Co.,  7  Fed.  Rep.  649,  2ndCir.  N.  Y.  1881,  19  Blatch. 
308,  12  Rep.  4.] 

7  [Lewis  V.  N.  E.  Fire  Ins.  Co.,  29  Fed.  Rep.  496  ;  24  Blatch.  181  (Vt.),  1886  ; 
Dupreau  v.  Insurance  Co.,  76  Mich.  615  (vendee  legally  in  possession  under  part 
paid  contract);  Johannes  v.  Standard  Fire  Office,  70  Wis.  196  (vendee  "not  in 
default.")] 

8  [Chandler  v.  Commerce  Fire  Ins.  Co.,  88  Pa.  St.  223,  227.J 

601 


§  288]  INSURANCE  :   FIRE,   LIFE,    ACCIDENT,    ETC.         [CH.  XHI. 

the  property  as  were  not  already  his  (promises  made  by  the 
holders  of  such  interests),  will  not  prevent  the  policy  from 
being  void  under  the  clause  requiring  the  entire  interest  to 
be  in  the  assured. ^  When  the  property  is  described  as  be- 
longing to  the  insured  or  "held  in  trust  by  him  "  the  printed 
condition  about  sole  ownership  does  not  apply. ^  When  the 
assured  represented  himself  to  be  the  owner  of  the  insured 
property,  but  in  answer  to  the  question  as  to  incumbrances, 
said  "Held  by  contract,"  the  latter  answer  precluded  a  war- 
ranty of  absolute  ownership.^] 

§  288.  Title  ;  Absolute  Interest ;  Leasehold  Interest.  —  When 
the  policy  provides  that  if  the  interest  to  be  insured  be  a 
leasehold  interest,  or  any  interest  not  absolute,  it  must  be 
so  represented,  upon  penalty  of  forfeiture,  reference  is  made 
to  the  character,  not  the  quantity,  of  the  interest.  An  abso- 
lute interest  is  equivalent  to  vested  interest,  or  an  interest 
so  completely  vested  that  the  party  owning  it  cannot  be  de- 
prived of  it  without  his  consent.  Interest  and  title  are  not 
synonymous.  Thus,  where  the  insured  had  entered  into 
possession,  and  made  valuable  improvements,  under  a  parol 
contract  of  purchase  at  an  agreed  price,  part  of  which  had 
been  paid,  and  his  interest  was  such  that  the  loss  would  fall 
upon  him  if  the  property  should  be  destroyed,  it  was  held 
that  a  statement  by  the  insured  that  the  property  was  his, 
was  true,  and  his  interest  was  an  absolute  one.*  So  the  pur- 
chaser of  personal  property  who  leaves  it  with  an  auctioneer 
to  sell,  with  instructions  to  pay  a  portion  of  the  proceeds  to 
the  owner,  and  to  hold  the  goods  generally  as  security  for 
any  advances  by  the  auctioneer,  has  an  "absolute  interest. "^ 
And  where  the  insured  owned  the  building  insured,  —  a 
four-story  brick   building,  —  and  had  a  lease  of   the  land 

1  [Miller  v.  Amazon  Ins.  Co.,  46  Mich.  463.] 

2  [Grandin  v.  Insurance  Co.,  107  Pa.  St.  26.] 

3  [McCulloch  V.  Norwood,  58  N.  Y.  562,  572.] 

*  [Housli  V.  City  Fire  Ins.  Co.,  29  Conn.  10.  And  see  also  Irving  v.  Excelsior 
Fire  Ins.  Co.,  1  Bosw.  (N.  Y.  Superior  Ct.)  507  ;  ante,  §  285.  But  see  this  sec- 
tion further  on.  A  mere  intruder  in  possession  may  have  such  title  as  possession 
gives,  and  that  may  he  absolute,  but  lie  has  not  an  "absolute  interest."  Porter 
V.  JEtna.  Ins.  Co.,  C.  Ct.  (Mich.),  6  Ins.  L.  J.  928. 

6  Franklin  Fire  Ins.  Co.  v.  Vaughan,  92  U,  S.  516. 

602 


CH.  XIII.]  TITLE   AND   INCUMBRANCE.  [§  288 

upon  which  it  stood,  stipulating  that  a  two-story  brick  build- 
ing should  be  left  upon  the  land  at  the  expiration  of  the 
term,  the  interest  was  held  to  be  properly  stated  as  his  own, 
and  was  not  a  leasehold  interest.  ^  So  where  the  policy  was 
to  be  void  if  the  interest  in  the  property  insured  was  a  lease- 
hold, or  other  interest  not  absolute,  and  the  insured  owned 
the  buildings,  but  had  only  a  lease  for  years  of  the  land 
upon  which  they  stood,  with  the  right  to  remove  the  build- 
ings at  the  end  of  the  term,  it  was  held  that  the  insured 
might  recover. 2  But  where  the  insured  was  in  possession 
only  under  an  agreement  to  purchase,  having  paid  but  a  part 
of  the  purchase-money,  the  policy  was  held  to  be  void,  the 
insured  not  having  an  absolute  estate.^  So  an  interest  under 
a  statutory  mechanic's  lien,  not  yet  confirmed  by  a  decree  of 
court,  upon  a  building  standing  upon  leased  land,  is  covered 
by  a  policy  which  is  by  its  terms  to  be  void  if  the  interest  of 
the  insured  be  a  leasehold  or  other  interest  not  absolute.* (a) 
But  a  building  standing  on  leased  land,  and  not  described  as 
such,  will  not  be  protected  by  a  policy  expressly  excluding 
such  property  from  its  protection,  unless  specifically  so  de- 
scribed and  insured  as  such.^  Where  lessees  of  land  for  a 
term  of  years  erected  thereon  a  building  which  was  to  be- 
come the  lessor's  at  the  expiration  of  the  term,  and  insured 
the  property,  describing  it  as  "their  .  .  .  building,"  "situ- 
ated on  leased  land,"  their  interest  was  held  to  be  "truly 
stated  "  in  the  policy.^     [Violation  of  a  condition  in  the  pol- 

1  David  V.  Hartford  Fire  Ins.  Co.,  13  Iowa,  69. 

2  Hope  Ins.  Co.  v.  Brolaskey,  3.5  Pa.  St.  282. 

3  Reynolds  v.  State  Mut.  Ins.  Co.,  2  Grant  (Pa.),  326  ;  Mers  v.  Franklin  Ins. 
Co.,  68  Mo.  127. 

*  Longhurst  v.  Conway  Fire  Ins.  Co.,  U.  S    Dist.  Ct.  Iowa,  1861,  cited  in 
Dige.st  of  Fire  Insurance  Decisions,  2d  ed.,  by  Clarke,  p.  584. 

5  Kibbe  v.  Hamilton  Mut.  Ins.  Co.,  11  Gray  (Mass.),  163. 

6  Fowle  V.  Springfield,  &c.  Ins.  Co.,  122  Mass,  191. 

(a)  A  mechanic's  lien  is  an  "incum-  225.     A  sale  under  such  lien  does  not 

brance  "  within  the  meaning  of  a  fire  increase   the  risk  when  the  period  for 

policy,  and  a  suit  thereon  works  a  for-  redemption  has  not  expired.     Greenlee 

feiture  under  a  condition  against  pro-  v.   North  British  and   Mercantile  Ins. 

ceedings  affecting  the  title.      Snath  v.  Co.,  102  Iowa,  427. 
St.  Paul  F.  &  M.  Ins.  Co.,  106  Iowa, 

603 


§  289]  INSURANCE :   FIEE,   LIFE,   ACCIDENT,   ETC.        [CH.  XIII. 

icy  that  if  the  building  is  on  leased  ground  it  must  be  so 
expressed,  will  be  fatal  although  no  question  was  asked  in 
the  application  in  respect  to  the  matter. ^  And  land  held 
under  a  lease  to  A.  and  his  heirs  and  assigns  forever,  re- 
serving a  perpetual  rent  to  the  grantor,  is  a  leasehold. ^J 

§  289.  Fee-Simple ;  Good  and  Perfect  unincumbered  Title ; 
Absolute  and  unconditional  Fee-Simple.  —  An  equitable  fee- 
simple  is  a  title  in  fee-simple,  though  the  legal  title  do  not 
pass.  Thus,  a  purchaser  in  possession,  but  under  a  defec- 
tively executed  deed,  has  an  equitable  title  in  fee-simple. 
A  "  less  estate  "  than  a  fee-simple  means  an  estate  of  less 
duration  than  a  fee-simple.^  "A  good  and  perfect  unincum- 
bered title  "  implies  a  title  good  both  at  law  and  in  equity ; 
and  an  outstanding  mortgage  undischarged  of  record,  though 
in  fact  paid,  is  a  breach  of  a  condition  that  the  property  in- 
sured has  such  a  title.  An  insurance  company  which  relies 
upon  its  lien  might  find  difficulty  in  enforcing  its  lien 
against  such  an  outstanding  mortgage.  The  proof  of  pay- 
ment might  not  be  obtainable,  and  it  is  not  unreasonable  to 
suppose  that  a  perfect  title  is  required  expressly  to  avoid 
such  difficulties.'*  An  "absolute  and  unconditional  fee- 
simple  "  does  not  exist  when  the  title  is  by  verbal  gift, 
though  the  donee  may  have  been  long  in  possession  and  may 
have  made  valuable  improvements,  and  though  the  gift  be 
with  a  promise  of  a  deed  which  was  in  fact  executed  and 
delivered  before  the  loss.^  Nor  can  a  husband  truly  state 
that  real  estate  belonging  to  his  wife  is  his,  when  the  char- 
ter of  the  company  requires  that  the  assured  must  have  a 
fee-simple  estate,  or  if  less  than  that,  the  true  interest  must 
be  stated  or  the  policy  will  be  void.^  A  mortgagee,  in  fact, 
however,  who  holds  by  an  absolute  deed,  may  describe  his 

1  [Eoss  V.  Citizens'  Ins.  Co.,  19  N.  B.  R.  126.] 

2  [Dowd  V.  Amer.  Fire  Ins.  Co.,  41  Hun,  139.] 

3  Swift  V.  Vermont  Mut.  Fire  Ins.  Co.,  18  Vt.  305. 

*  "Warner  v.  Middlesex  Mut.  Ass.  Co.,  21  Conn.  444.     But  see  post,  §  292. 

5  Winelaiid  v.  Security  Ins.  Co.  (Md.)  9  Ins.  L.  J.  551. 

6  Eminence  Mut.  lus.  Co.  v.  Jesse,  1  Met.  (Ky. )  563.  In  this  case  the  ques- 
tion was,  "  Have  you  a  clear  title  to  the  property  which  you  wish  to  be  insured  ?  " 
to  which  tlie  answer  was,  "  It  was  the  house  of  J.  P.  Foree,  whose  title  was  as 
good  as  anv  man's  in  the  country,  and  who  was  the  father  of  my  wife." 

6U4 


CH.  XIII.J  TITLE    AND   INCUMBRANCE.  [§  290 

title  as  a  fee-simple.^  [An  insured  having  only  a  life  estate, 
and  not  so  stating,  the  policy  is  void.^  If  the  policy  is  to  be 
void  provided  the  insured  is  not  the  owner  in  fee-simple  of 
the  land  under  the  buildings  insured,  unless  the  fact  be  ex- 
pressed in  the  policy,  a  verdict  for  the  insured  in  a  case 
where  it  was  shown  that  he  was  only  owner  in  fee  of  an 
undivided  portion  of  the  land,  and  no  waiver  was  proved, 
should  be  set  aside.^  But  a  warranty  that  the  insured  has 
the  fee-simple  is  not  broken  if  he  is  in  condition  to  enforce 
specific  performance  of  a  bond  to  convey  to  himself.*  When 
several  persons  interested  in  the  same  property  are  insured 
in  respect  to  it,  the  provision  that  any  interest  other  than 
a  fee-simple  must  be  stated,  applies  to  their  united  interest, 
and  unless  that  is  less  than  a  fee-simple  the  provision  is  in- 
operative.^ A  warranty  of  ownership  in  fee-simple  is  not 
broken  where  the  insured  is  in  a  condition  to  enforce  specific 
performance  of  a  bond  to  convey.^] 

§  290.  Incumbrance.  —  The  general  object  of  the  inquiry 
as  to  incumbrance  is  to  ascertain  the  amount  of  the  interest 
of  the  insured  in  the  property  as  affecting  the  judgment  of 
the  insurers  upon  the  value  of  the  risk,  by  taking  into  con- 
sideration the  motive  which  the  insured  may  have  in  the 
preservation  of  the  property.  Mutual  insurance  companies 
are  also  interested  to  know  the  amount  of  the  incumbrance 
with  reference  to  the  value  of  any  lien  which  they  may  have 
for  the  security  of  the  payment  of  assessments.  Statements 
as  to  incumbrance  are  material,  and  have  regard  to  the  risk.*^ 
If  no  inquiry  be  made,  nothing  but  good  faith  is  necessary, 
touching  the  title  or  interest.^     Where  the  fa,ct  of  incum- 

1  White  V.  Agf.  Mut.  Ins.  Co.,  22  U.  C.  (C.  P.)  98. 

2  [Davis  V.  Iowa  State  Ins.  Co.,  67  Iowa,  494.] 

3  [Scottish  Union,  &c.  Ins.  Co.  v.  Petty,  21  Fla.  399.] 
*  [East  Tex.  Fire  Ins.  Co.  v.  Dyches,  56  Tex.  565.] 

5  [Rankin  v.  Andes  Ins.  Co.,  47  Vt.  144,  146.] 

6  [East  Tex.  Fire  Ins.  Co.  v.  Dyches,  56  Tex.  565.] 

'  Friesmuth  v.  Agawam  Mut,  Ins.  Co.,  10  Cush.  (Mass.)  588  ;  Patten  v. 
Merchants'  &  Farmers'  Ins.  Co.,  38  N.  H.  338  ;  Piichardson  v.  Maine  Ins.  Co.,  46 
Me.,  394  ;  Gahagan  v.  Union  Mut.  Ins.  Co.,  43  N.  H.  176  ;  Schumitsch  v.  Amer- 
ican Ins.  Co.,  48  Wis.  26  ;  Byers  v.  Farmers'  Ins.  Co.,  35  Ohio  St.  606. 

»  West  Rockingham,  &c.  Lis.  Co.  v.  Sheets,  26  Grat.  (Ya.)  854  ;  Morrison  v. 
Tennessee,  &c.  Ins.  Co.,  18  Mo.  262. 

605 


§  291]  INSURANCE  :    FIKE,    LIFE,    ACCIDENT,   ETC.        [CH.  XIII. 

brance  is  required  to  be  stated  by  special  conditions  or  by 
specific  inquiry,  a  general  statement  of  the  fact,  without  giv- 
ing the  particulars  of  the  amount,  is  sufficient,  even  though 
the  amount  be  called  for,  if  a  policy  be  issued  upon  the  in- 
complete and  general  answer.  The  acceptance  of  the  risk 
and  issue  of  the  policy  on  the  general  answer  will  be  deemed 
a  waiver  on  the  part  of  the  insured  of  further  particulars.  ^ 
But  if  the  insured  undertake  to  state  the  number  of  mort- 
gages, and  does  not  state  them  truly,  his  policy  will  be  void.^ 
And  a  substantially  untrue  statement  of  the  amount,  with 
the  accrued  interest,  will  also  avoid  the  policy. ^  And  that, 
too,  without  reference  to  the  fact  that  the  company  is  a  for- 
eign one,  and  has  no  hen  in  the  State  where  the  insurance 
is  made.* 

§  291.  Incumbrance,  what  is.  —  A  mortgage,  of  course,  is 
an  incumbrance,^  though  without  consideration,  and  there- 
fore fraudulent  and  void  as  against  creditors,^  and  though  un- 
recorded, if  delivered; 7  although  the  insured  did  not  acquire 
title  till  after  the  date  of  the  mortgage. ^  So  is  a  lien  for 
taxes  ;'^  and  a  mechanic's  lien,  if  initiatory  steps  to  enforce  it 
have  been  taken ;  ^^  and  an  attachment,  if  judgment  follows ; " 

1  Nichols  V.  Fayette  Mut.  Fire  Ins.  Co.,  1  Allen  (Mass.),  63  ;  Wyman  v.  Peo- 
ple's Equity  Ins.  Co.,  1  Allen  (Mass.),  301  ;  Dohn  v.  Farmers'  Joint-Stock  Ins. 
Co.,  5  Lans.  (N.  Y.)  275. 

2  Towne  v.  Fitchburg  Mut.  Fire  Ins.  Co.,  7  Allen  (Mass. ),  51  ;  Smith  v.  Em- 
pire Ins.  Co.,  25  Barb.  (N.  Y.)  497  ;  Battles  v.  York  County  Mut.  Ins.  Co.,  41 
Me.  208. 

3  Lowell  V.  Middlesex  Mut.  Fire  Ins.  Co.,  8  Cush.  (Mass.),  127  ;  Hayward  v. 
New  England  Mut.  Ins.  Co.,  10  Cush.  (Mass.)  444  ;  Jacobs  v.  Eagle  Mut.  Fire 
Ins.  Co.,  7  Allen  (Mass.),  132. 

*  Davenport  v.  New  England  Mut.  Ins.  Co.,  6  Cush.  (Mass.)  340. 

5  Masters  v.  Madison  County  Mut.  Ins.  Co.,  11  Barb.  (N.Y.)  624;  ^tna 
Ins.  Co.  V.  Kesh,  40  Mich.  241  ;  [Mallory  v.  Farmers'  Ins.  Co.,  65  Iowa, 
450]. 

6  Treadway  v.  Hamilton  Mut.  Ins,  Co.,  29  Conn.  68. 

7  Hutchins  v.  Cleveland  Mut.  Ins.  Co.,  11  Ohio  St.  477.  Otherwise  if  not 
delivered.     Olmstead  v.  Iowa  Mut.  Ins.  Co.,  24  Iowa,  503. 

8  Packard  v.  Agawam  Mut.  Fire  Ins.  Co.,  2  Gray  (Mass.),  334. 

9  Wilbur  V.  Bowditch  Mut.  Ins.  Co.,  10  Cush.  (Mass.)  446. 

w  Longhurst  v.  Conway  Fire  Ins.  Co.,  U.  S.  Dist.  Ct.  Iowa,  1861,  cited  in 
Digest  of  Fire  Ins.  Decisions  (2d  ed.),  p.  247;  Redmon  v.  Phoenix  Ins.  Co. 
(Wis.)  11  Reptr.  687  ;  s.  c.  10  Ins.  L.  J.  287. 

11  Brown  v.  Commonwealth  Ins.  Co.,  41  Pa.  St.  187. 

606 


CH.  XIII.]  TITLE    AND   INCUMBRANCE.  [§  291  A 

and  a  seizure  on  execution;^  and  a  title  under  a  sale  on 
execution,  subject  to  the  debtor's  equity  of  redemption  ;2 
and  an  assessment  upon  a  deposit  note  to  pay  a  loss;^ 
and  a  lien  for  a  balance  due  of  the  purchase-money  where 
the  purchaser  is  in  possession  under  an  agreement  for  pur- 
chase, having  paid  part  of  the  purchase-money/  and  a  judg- 
ment lien  existing  at  the  time  of  insurance.^ (a)  [A  deposit 
of  title-deeds  upon  an  advance  of  money  creates  an  equitable 
lien.^  But  the  mere  possession  of  title-deeds  without  ex- 
planation or  evidence  of  how  they  were  obtained,  docs  not 
create  an  equitable  mortgage  or  lien."] 

[§  291  A.  Incumbrance  Fatal.  —  If  the  policy  is  to  be  void  by 
an  incumbrance,  without  written  consent  of  the  company,  such 
incumbrance  avoids  it,  whether  known  to  the  assured  or  not.^(5) 

1  Penn.  Ins.  Co.  v.  Gottsman,  48  Pa.  St.  151,  158.  [But  the  insured  is  not 
■bound  to  disclose  a  levy  and  execution  on  goods  still  in  his  possession  unless 
such  information  is  specially  called  for,  or  he  knows  that  the  levy  increases  the 
risk.  There  was  nothing  in  the  policy  to  warn  him  that  the  company  regarded 
the  levy  as  an  increase  of  risk,  nor  was  there  any  suspicion  that  the  transaction 
and  loss  were  not  honest.     Niagara  Fire  Ins.  Co.  v.  Miller,  120  Pa.  St.  504,  516.] 

2  Campbell  v.  Hamilton  Mut.  Ins.  Co.,  51  Me.  69. 

8  Jackson  v.  Farmers'  Mut.  Fire  Ins,  Co.,  5  Gray  (Mass.),  52  ;  Tuttle  v.  Rob- 
inson, 33  N.  H.  104. 

4  Reynolds  v.  State  Mut.  Ins.  Co.,  2  Grant  (Pa.),  326. 

6  Bowman  v.  Franklin  Ins.  Co.,  40  Md.  620  ;  Gottsman  v.  Penn.  Ins.  Co.,  56 
Pa.  St.  210  ;  Merrill  v.  Agr.  Ins.  Co.,  73  N.  Y.  452  ;  [Leonard  v.  American  Ins. 
Co.,  97  Ind.  299.  But  the  warranty  against  incumbrances  is  not  broken  by  the 
existence  of  judgments,  receipts  for  the  satisfaction  of  which  can  be  shown, 
although  they  are  not  satisfied  of  record.  Lang  v.  Hawkeye  Ins.  Co.,  74  Iowa, 
673.  And  where  a  policy  covering  real  and  personal  property  is  to  be  void  if  any 
incumbrance  is  put  upon  the  property  without  the  company's  consent,  a  judg- 
ment against  the  assured  not  being  an  incumbrance  on  the  whole  property  in- 
sured, but  only  on  the  real  estate,  is  not  fatal,  for  the  clause  strictly  construed 
refers  to  incumbrances  on  the  whole  property,  and  it  must  be  strictly  construed, 
the  defence  being  merely  technical.  Bailey  v.  Homestead  Fire  Ins.  Co.,  16  Hun, 
503,  506.] 

6  [Langston,  Ex  parte,  17  Vesey,  227  ;  Wells  v.  Archer,  10  S.  &  R.  412  : 
Whitbread,  Ex  parte,  19  Vesey,  209;  Kensington,  Ex  parte,  204,  379.] 

7  [Chapman  v.  Chapman,  13  Beav.  308.] 

8  [Hench  v.  Insurance  Co.,  122  Pa.  St.  128,  if  continued  to  the  time  of  loss  : 
Ellis  V.  State  Ins.  Co.,  61  Iowa,  577.] 

{a)    There  is  an  incumbrance  of  the  Renninger  v.  Dwelling-House  Ins.  Co., 

title  as  to  insurance  if  the  insured  takes  168  Penn.  St.  350. 

the  property  under  a  will  at  a  stated.  {h)    A  stipulation  in  a  policy  against 

sum,  to  be  paid  in  annual  instalments,  incumbrances  without  the  insurer's  con. 


60 


§  291  A]       INSURANCE  :    FIRE,    LIFE,   ACCIDENT,   ETC.        [CH.  XIII. 

A  judgment  on  an  official  bond  though  unknown  to  the 
insured  will  avoid  his  policy,  on  failure  to  give  the  com- 
pany notice  of  the  incumbrance  and  pay  the  additional 
premium.  1  In  this  case  the  mortgage  on  the  property  at  the 
time  of  insurance  had  been  reduced  more  than  the  amount 
of  the  judgment,  so  that  the  total  incumbrance  was  less  in 
amount  than  at  first.  The  court  hinted  that  on  another  trial 
this  fact  might  carry  the  case  against  the  company. ^  A.^ 
while  building  a  house,  negotiated  with  an  insurance  agent 
to  insure  it.  Among  the  questions  asked  as  a  part  of  the 
application  which  the  agent  was  to  fill  out  was,  if  there  was 
any  incumbrance  on  the  building,  the  answer  being  no,  but 
that  the  plaintiff  owed  for  materials  and  was  intending  to 
incumber  it  to  pay  for  them.  In  answer  to  "How  much"  he 
was  to  incumber,  he  replied  that  he  really  did  n't  know,  "not 
less  than  $1000."  The  agent  inserted  in  the  application 
"incumbrance  of  $1000,"  did  not  read  the  same  to  the  plain- 
tiff, and  the  policy  was  so  made  out,  with  a  condition  avoid- 

1  [Pemi.  Mut.  Fire  Ins.  Co.  v.  Schmidt,  119  Pa.  St.  449.]         2  [id.  461.] 

sent  relates  to  voluntary  incumbrances,  judgment  on  tax  lien  m  invitum  against 
and  not  to  judgment  liens  or  other  the  insured  while  the  policy  is  in  force, 
liens  created  by  law.  Lodge  v.  Capital  further  than  to  make  it  voidable  accord- 
Ins.  Co.,  91  Iowa,  103  ;  Phenix  Ins.  ing  to  such  conditions  as  the  policy 
Co.  V,  Pickel,  119  Ind.  155.  But  see  contains.  Gerling  v.  Agricultural  Ins. 
Capital  City  Ins.  Co.  v.  Autrey,  105  Co.,  39  W.  Va.  689  ;  Dover  Glass 
Ala.  269;  Carey  v.  German-American  Works  Co.  v.  American  F.  Ins.  Co., 
Ins.  Co.,  84  Wis.  80  ;  Walradt  v.  1  Marvel  (Del.),  32  ;  Lodge  v.  Capital 
Phcenix  Ins.  Co.,  136  N.  Y.  375.  Ins.  Co.,  91  Iowa,  103.  But  an  express 
"  Attached,"  when  stipulated  against,  provision  avoiding  the  policy  if  the  in- 
nsually  refers  to  personalty  only,  at-  sured  pro]ierty  is  levied  upon  or  taken 
tended  by  a  change  of  possession,  into  possession  or  custody  under  any 
Tefft  V.  Providence- Washington  Ins.  legal  process,  is  valid  ;  and  even  if  a 
Co.  (P.  I.),  32  Atl.  914.  See  Carey  v.  part  only  of  such  property  is  attached, 
German-American  Ins.  Co.,  84  AVis.  80;  the  contract,  being  indivisible,  is  wholly 
Carey  u.  Phenix  Ins.  Co.,  id.  208;  void.  Burr  y.  German  Ins.  Co.,  84Wis.  76. 
Wheeler  v.  Real  Estate  Title  Ins.  Co.,  A  stipulation  avoiding  the  policy  if 
160  Penn.  St.  408.  "Increase  of  risk,"  the  insured  property  becomes  involved 
when  provided  against  in  a  policy,  re-  in  litigation  is  not  against  public  policy. 
lates  to  change  of  structure,  heating,  Small  v.  Westchester  F.  Ins.  Co.,  51 
&c.,  and  not  to  sales  under  existing  Fed.  Rep.  789.  That  clause  refers  only 
judgments.  Collins  v.  London  Ass.  to  litigation  respecting  the  insured's 
Corp.,  165  Penn.  St.  298.  A  provision  title  or  jjossession,  and  not  to  a  suit  to 
against  incumbrances  by  mortgage,  eject  a  tenant.  Hall  v.  Niagara  F.  Ins. 
judgment  liens,  &c.,  does  not  cover  a  Co.,  93  Mich.  184. 

608 


CH.  XIII.]  TITLE    AND    INCUMBRAXCE.  [§  292 

ing  it,  if  the  amount  was  increased  without  the  company's 
consent.  A.  subsequently  gave  a  mortgage  for  81500  on  it, 
and  the  policy  was  held  avoided.^  A  partner's  mortgage  of 
his  interest  to  a  third  party  violates  the  condition  against 
incumbrance  of  the  firm  property  insured. ^J 

§  292.  Incumbrance,  what  is  not.  —  A  mortgage  which  has 
been  paid,  though  not  discharged  of  record,  is  no  longer  an 
incumbrance. 3  Nor  is  an  invalid  mortgage.*  [Nor  a  mort- 
gage barred  by  the  statute  of  limitations  at  the  time  the  pol- 
icy is  issued.^]  Nor  is  a  bond  for  the  conveyance  of  the 
premises  insured,  upon  the  payment  of  the  purchase-money 
at  a  specified  time,  although  the  forfeiture  on  account  of 
the  expiration  of  the  time  has  been  waived,  if,  in  fact,  the 
money  has  not  been  paid ;  ^  nor  a  bond  by  the  grantee  in  a 
deed  to  support  the  grantor,  given  as  a  part  of  the  consider- 
ation for  the  conveyance ;'  nor  a  vendor's  lien;^  nor  is  a 
judgment  against  one  of  several  insurers.^  In  Jackson  v. 
Farmers'  Mutual  Fire  Insurance  Company, ^^  the  question 
arose  whether  a  liability  for  an  assessment  on  a  deposit 
note,  laid  under  a  policy  which  was  afterwards  declared  void 
on  account  of  an  increase  of  the  risk,  was  an  incumbrance 
such  as  ought  to  have  been  disclosed  by  the  insured  in  a  new 
policy  taken  out  from  another  company  after  the  increase  of 

1  [Sentell  v.  Oswego  Co.  Farmers'  Ins.  Co.,  16  Hun,  516,  519.] 

2  [Hicks  V.  Fanners'  Ins.  Co.,  71  Iowa,  119.] 

3  Hawkes  v.  Dodge  County  Mat.  Ins.  Co.,  11  Wis.  188  ;  Merrill  v.  Agr.  Ins. 
Co.,  73  N.  Y.  452.  But  see  Warner  v.  Middlesex  Mut.  Ass.  Co.,  21  Conn.  444  ; 
rmte,  §  289.  And  an  outstanding  undischarged  mortgage  has  been  held  to  be  an 
incumbrance,  though  actually  paid  by  services  rendered  to  the  mortgagee  by  the 
mortgagor,  and  while  the  former  was  ready  to  cancel  the  mortgage.  Muma  v. 
Niagara,  &c.  Ins.  Co.,  22  U.  C.  (Q.  B.)  214  ;  [The  doctrine  of  the  text  is  affirmed 
in  Smith  v.  Niagara  Fire  Ins.  Co.,  60  Vt.  682,  citing  all  the  cases  of  this  note.] 

*  Watertown  Fire  Ins.  Co.  v.  Grover,  &c.  Co.,  41  Mich.  131. 

5  [Lockwood  V.  Middlesex  Mut.  Ass.  Co.,  47  Conn.  553.] 

6  Newhall  v.  Union  Mut.  Fire  Ins.  Co.,  52  Me.  180. 

T  Mason  v.  Agr.  &c.  Ass.  Co.,  18  U.  C.  (C.  P.)  19.  [In  Canada,  however,  it 
has  been  held  that  concealment  of  the  fact  that  property  is  charged  with  the  main- 
tenance of  the  plaintiff's  father  is  the  concealment  of  an  incumbrance,  but  bad 
faith  must  be  shown.     Reddick  v.  Saugeen  Mut.  Fire  Ins.  Co.,  14  Out.  R.  506.] 

8  Dohn  V,  Farmers'  Ins.  Co.,  5  Lans.  (N.  Y.)  275. 

9  Miller  V.  Germania  Ins.  Co.,  C.  C.  P.  (Pa.),  6  Ins.  L.  J.  873. 
10  5  Gray  (Ma.ss.),  52. 

vol!  I.  —39  609 


§  292  A]        INSURANCE  :    FIRE,    LIFE,    ACCIDENT,    ETC.         [CH,  XIII. 

risk  and  before  the  policy  was  declared  void,  and  was  dis- 
cussed, though  not  decided,  with  an  evident  inclination  to 
the  negative.     "It  will  be  a  grave  question,  we  think,"  says 
Shaw,  C.  J.,  "whether  a  remote  contingent  liability  or  pos- 
sibility of  charge  for  a  very  minute  assessment  is  an  incum- 
brance within  the  meaning  of  this  contract  of  insurance. 
Perhaps  a  different  rule  may  apply  in  covenants  against  in- 
cumbrances, because  founded  on  a  different  reason;  thus  a 
purchaser,  having  paid  a  full  compensation  for  the  estate, 
with  all  its  benefits,  has  a  right  to  expect  in  his  grant  and 
covenants  an  indefeasible  title  without  further  charge.   .  .   . 
It  is,   m  effect,  a  stipulation  that  if  there  be  any  charge 
upon  the  estate,  known  or  unknown,  the  vendor  of  the  estate 
will  pay  the  expense  of  removing  it.     Should  the  same  rule 
apply  to  this   subject  of   representation  with  a  view  to  in- 
surance, every  married  man  making  application  for  an  in- 
surance,  in  answer  to  the  question  whether  his  estate   is 
incumbered,  must  state  that  he  has  a  wife  living,  otherwise 
the  policy  would  be  void."     A  tax-title  held  by  a  third  party 
whose  relations  are  such  that  he  would  be  held  in  equity  as 
trustee,  has  been  held  to  be  no  incumbrance.  ^     And  a  con- 
tingent right  of  dower  or  curtesy  is  no  incumbrance.  ^     It 
may  be  otherwise  where,   after   the  death  of   the  husband, 
dower  has  attached.^     Incumbrances  "without  the  consent" 
of  the  company  do  not  include   those   liens  and  claims  — ■ 
such,  for  instance,   as  judgment  liens  —  which  are  enforce- 
able against  the  will  of  the  insured,  but  only  such  as  may 
be  created  by  his  consent,  and  on  application  to  the  com- 
pany for  its  consent.* 

[§  292  A.  No  Incumbrance.  —  The  word  "  incumbrance  " 
has  no  reference  to  an  involuntary  lien  effected  by  the  law, 
where  the  condition  is  "If  the  property  shall  hereafter  be- 

1  Newman  v.  Springfield  Fire  &  Mar.  Ins.  Co.,  17  Minn.  123. 

2  Virginia  Fire,  &c.  Ins.  Co.  v.  Kloeber  (Va.),  9  Ins.  L.  J.  354  ;  Commer- 
cial Ins.  Co.  V.  Spankneble,  52  111.  53  ;  Virginia  Ins.  Co.  v.  Kloeber  (Va.),  9  Ins. 
L.  J.  30. 

8  Security  Ins.  Co.  v.  Bronger,  6  Bush  (Ky.),  147. 

*  Green  v.  Homestead  Ins.  Co.  (N.  Y.)  10  Ins.  L.  J.  175  ;  Baley  v.  Homestead 
Ins.  Co.,  80  N.  y.  21 ;  [Steen  v.  Niagara  Falls  Ins.  Co.,  61  How.  Pr.  144,  148]. 

610 


CH.  XIII.]  TITLE   AND   INCUMBRANCE.  [§  292  B 

come  mortgaged  or  incumbered."^  The  question  "Is  there 
a  mortgage,  deed  of  trust,  lien,  or  incumbrance  of  any  kind 
on  property  ?  "  relates  only  to  incumbrances  created  by  act 
or  consent  of  the  party,  and  an  omission  to  state  a  statute 
lien  for  unpaid  taxes  is  no  breach  of  warranty.^  The  court 
gives  no  reason  for  this  opinion.  If  the  reason  for  wishing 
to  know  of  incumbrances  is  to  gauge  the  applicant's  interest 
to  care  for  the  property,  then  a  statute  lien  is  as  much 
within  the  reason  as  any  other  if  the  assured  knows  of  it. 
It  certainly  is  covered  by  the  words  "lien  or  incumbrance 
of  any  kind,"  and  unless  the  applicant  was  ignorant  of  the 
fact  that  taxes  were  a  lien,  which  fact  did  not  appear,  he 
should  have  stated  the  tax  lien.  If  the  assessment  is  illegal 
of  course  there  is  no  incumbrance  by  it.^  Neither  the  entry 
of  land  in  an  assessment  roll  nor  the  assessment  and  subse- 
quent levy  of  a  tax  thereon  is  a  breach  of  a  covenant  against 
incumbrances  in  a  deed  of  the  land  made  after  completion 
of  the  assessment  roll  but  before  a  levy  of  the  tax.^  A  pol- 
icy, to  be  void  if  the  property  is  incumbered  by  mortgage  or 
otherwise,  is  not  rendered  invalid  by  the  existence  of  a  lien, 
if  no  questions  were  asked  or  representations  made  about  the 
matter  at  the  time  of  application  or  issuance  of  the  policy.^ 
A  lease  of  five  years  is  not  an  incumbrance.^] 

[§  292  B.  Misrepresentation  and  Concealment.  —  Conceal- 
ment of  an  existing  incumbrance  avoids  a  policy  when  the 
act  of  incorporation  so  provides. ^  Failure  to  state  a  mort- 
gage of  1)450  and  falsely  affirming  that  there  were  no  incum- 
brances is  fatal. s  So,  alleging  the  amount  of  incumbrance 
to  be  "  about  83,000  "  when  in  fact  it  was  84, 000.  ^  So,  stat- 
ing an  incumbrance  of  $4,400  at|3,OOO.io     If  the  insured 

1  [Phenix  Ins.  Co.  v.  Pinkel,  18  Ins.  L.  J.  592  (Ind.)  May,  1889.] 

2  [Hosford  V.  Hartford  Fire  Ins.  Co.,  127  U.  S.  404.] 

8  [Runkle  v.  Citizens'  Ins.  Co.,  11  Ins.  L.  J.  94  ;  6th  Cir.  (Ohio),  1882.] 
*  [Barlow  v.  St.  Nicholas  Nat.  Bank,  63  N.  Y.  399,  404.] 
6  [Dwelling-House  Ins.  Co.  v.,  Hoffman,  125  Pa.  St.  626.] 

6  [Lockwood  V.  Middlese.x  Mut.  Ass.  Co.,  47  Conn.  553.] 

7  [Gahagan  v.  Insurance  Co.,  43  N.  H.  176,  177.] 

8  [Indiana  Ins.  Co.  i;.  Brehm,  88  Ind.  578.] 

9  [Hayvvard  v.  New  Eng.  Uut.  Fire  In.s.  Co.,  10  Cush.  444,  445.] 
10  [Glade  v.  Germania  Fire  Ins.  Co.,  56  Iowa,  400.] 

611 


§  292  B]  INSURANCE,   FIRE,   LIFE,    ACCIDENT,   ETC.        [CH.  XIII. 

warrants  that  he  has  given  all  information  material  to  the 
risk,  it  is  a  breach  if  he  says  nothing  about  a  mortgage 
which  he  believes  to  be  outstanding  on  the  property,  although 
the  mortgage  may  in  fact  have  been  paid  without  his  knowl- 
edge. The  moral  hazard  is  the  same  if  he  believes  the  place 
to  be  mortgaged,  as  if  it  were  so.  ^  If  an  applicant  states 
that  there  is  no  incumbrance  when  in  fact  there  is  a 
mortgage,  the  materiality  of  tlie  misstatement  is  for  the 
jury.  2 

A.  sold  an  estate  to  B.,  covenanting  for  a  perfect  title  and 
agreeing  to  pay  off  an  old  mortgage  of  $200,  B.  gave  the 
vendor  back  a  mortgage  and  insured,  representing  that  the 
latter  was  the  only  incumbrance.  It  was  held  that  in  equity 
this  was  so,  since  B.  could  extinguish  the  old  mortgage  by 
the  amount  he  would  have  to  pay  on  his  own,  and  the  court 
would  not  allow  the  insurer  to  avoid  the  policy  for  mere 
technical  and  formal  defects.^  Where  an  incumbrance  of 
$37,000  on  the  property  insured  has  been  changed  by  parol 
agreement  to  one  of  $12,000,  which  is  named  to  the  insur- 
ance company,  the  latter  cannot  avoid  the  policy  on  the 
ground  that  in  reality  the  parol  agreement  was  void  under 
the  statute  of  frauds,  wherefore  the  real  incumbrance  was 
$37,000.  A  stranger  to  the  contract  cannot  raise  such  a 
plea.*  Misstatements  of  incumbrances  or  subsequent  incum- 
brances on  portions  of  the  plaintiff's  farm,  none  of  which 
incumber  the  land  on  which  the  insured  building  stands,  do 
not  avoid  the  policy.^  When  a  policy  stipulated  that  it 
should  be  void  unless  the  incumbrance,  if  any,  was  expressed 
therein,  it  was  held  that  the  mere  stating  that  there  was  an 
incumbrance  without  stating  the  amount  was  a  sufficient 
compliance  with  the  requirement  of  the  policy  and  charter.^ 
Where  the  questions  and  answers  were:  "Is  there  any  in- 
cumbrance on  the  property  ?  —  Yes.     If  mortgaged,  state  the 

1  [Smith  V.  Niagara  Fire  Ins.  Co.,  60  Vt.  682,  690.] 

2  [Sweat  V.  Piscataquis  Mut.  Ins.  Co.,  79  Me.  109.] 

3  [Ring  V.  Windsor  Co.  Mut.  Fire  Ins.  Co.,  54  Vt.  434.] 
*  [Mutual  Mill  Ins.  Co.  v.  Gordon,  20  Brad.  565.] 

5  [Eddy  V.  Hawkeye  Ins.  Co.,  70  Iowa,  472.] 

6  [Bersche  v.  St.  Louis  Ins.  Co.,  31  Mo.  555,  560.] 

612 


CH.  XIII.]  TITLE   AND   INCUMBRANCE.  [§  294 

amount.  — $3,000,"  an  omission  to  state  other  incumbrances 
did  not  avoid  the  policy.^] 

§  293.  Incumbrance  ;  Several  Mortgages.  —  If  a  mortgagee 
insures  his  interest  as  mortgagee,  under  a  provision  calling 
for  incumbrances  calculated  to  affect  the  interest,  other 
mortgages  should  be  stated. ^  But  where  the  insurance  is 
specifically  upon  the  particular  interest,  and  not  upon  the 
property,  other  incumbrance  upon  the  property  need  not  be 
stated ;  as  where  a  "  mechanic's  lien  on  the  Lawrence  Block  " 
was  specified  as  the  subject-matter  of  insurance,  and  a  nega- 
tive answer  to  the  question  whether  "  it  "  was  incumbered 
was  given,  it  was  held  that  this  was  no  misrepresentation, 
although  there  were  other  liens  upon  the  same  block.  ^ 

§  294.  Incumbrance  made  after  Application ;  Reduction  of 
Interest.  —  In  Howard  Fire  Insurance  Company  v.  Bruner,^ 
application  was  made  for  insurance  July  17,  and  the  policy 
countersigned  and  issued  on  the  25th  of  the  same  month.  A 
mortgage  existing  on  the  ITth  was  disclosed  in  the  applica- 
tion, but  a  mortgage  executed  on  the  25th,  and  after  the 
delivery  of  the  policy,  was  not  disclosed.  And  it  was  held 
that  it  need  not  be,  as  it  was  a  subsequent  incumbrance, 
whereas  the  inquiry  related  only  to  existing  incumbrances,  (a) 
And  in  Dutton  v.  New  England  Mutual  Fire  Insurance  Com- 
pany,^ a  mortgage  executed  on  same  day  when  the  policy 
was  issued,  but  whether  before  or  after  delivery  of  the  policy 
did  not  appear,  was  held  to  be  a  subsequent  incumbrance 
which  the  applicant  was  not  bound  to  disclose  in  reply  to 
the  interrogatory  on  that  point,  whether  executed  before  or 

1  [Hosford  V.  Germania  Fire  Ins.  Co.,  127  U.  S.  399.] 

2  Addison  v.  Kentucky  &  Louisiana  Ins.  Co.,  7  B  Mon.  (Ky.)  470;  Smith 
V.  Columbia  Ins.  Co.,  17  Pa.  St.  253;  Rex  v.  Insurance  Companies,  2  Pbila. 
(Pa.)  357. 

3  Longhurst  v.  Conway  Fire  Ins.  Co.,  U.  S.  Dist.  Ct.  Iowa,  186L 
*  23  Pa.  St.  50- 

6  9  Fost.  (N.  H.)  153. 

(a)    A  clause  in  a  policy  providing  affect  statements  and  acts  of  agents  and 

that  the  company  shall  not  be  bound  by  others  after  the  delivery  and  acceptance 

any  act  of  or  statement  to  the  agent  not  of  the  policy.     Hoose  v.  Prescott  Ins. 

contained  in  the  policy  or  the  written  Co.,  84  Mich.  309  ;  Ahlberg  v.  German 

application    for    insurance,    and    other  Ins.  Co.,  94  id.  259. 
preliminary    papers,    is    held  only    to 

613 


§  29  i]  insurance:   fire,   life,   accident,    etc.         [CH.  XIII. 

after  the  delivery  of  the  policy,  as  it  was  not  an  incum- 
brance when  the  application  was  filed  and  the  answer  made, 
five  days  before.  What  would  be  the  effect  if  the  mortgage 
was  in  contemplation  at  the  time  the  application  was  filed, 
and  purposely  kept  open  till  after  the  delivery  of  the  policy, 
was  not  decided.  But  it  was  intimated  that  such  facts  might 
amount  to  a  fraudulent  concealment  of  a  fact  material  to  the 
risk.  Where  a  policy  was  assigned  by  consent  of  the  in- 
surers to  the  plaintiffs,  and  afterwards  the  insured  mortgaged 
the  property  insured  to  the  plaintiff's  to  protect  them  as 
accommodation  indorsers  for  the  insured,  it  was  held  that 
this  was  not  such  an  incumbrance  as  was  contemplated  in 
the  policy,  which  provided  for  notice  of  any  incumbrance 
"sufficient  to  reduce  the  real  interest  of  the  insured  to  a  sum 
only  equal  to,  or  below,  the  amount  insured."^  The  confes- 
sion of  a  judgment  to  a  greater  amount  than  the  value  of  the 
insured  property  is  a  sufficient  reduction  of  the  assured's  in- 
terest therein  "  below  the  amount  insured  "  to  work  a  forfeit- 
ure of  a  policy  having  a  condition  against  such  a  reduction, 
though  no  execution  issue  upon  the  judgment.^  If  the  con- 
dition be  against  incumbrances  made  by  the  applicant,  one 
made  by  the  assignee  of  the  property  does  not  work  a  for- 
feiture.^ [When  a  mortgage,  given  without  the  company's 
knowledge  and  in  violation  of  a  condition  in  the  policy,  is 
produced  in  evidence,  the  presumption,  in  the  absence  of 
evidence  to  the  contrary,  is  that  the  amount  for  which  the 
mortgage  was  given  is  still  due  thereon.*  An  incumbrance 
in  violation  of  the  policy  only  suspends  it,  and  if  paid  before 
loss  the  policy  revives.^ 

1  Allen  V.  Hudson  River  Mut.  Ins.  Co.,  19  Barb.  (N.  Y.)  443.  It  certainly 
seems  an  extremely  liberal  interpretation  in  favor  of  the  insured,  to  protect  him 
against  the  consequences  of  a  material  change,  effected  by  himself,  in  the  status 
of  the  property  insured,  between  the  time  of  the  application  and  that  of  issuing 
the  policy,  by  holding  that  the  insurance  is  by  relation  from  the  date  of  filing  the 
application.  Besides  opening  a  wide  door  to  fraud,  it  does  not  seem  to  be  in 
accordance  with  the  well-settled  doctrine  that  a  material  change  intervening,  pend- 
ing the  negotiations,  ought  to  be  disclosed.     See  ante,  §  190. 

2  Kensington  Bank  v.  Yerkes,  86  Pa.  St.  227. 

8  Richardson  v.  Canada,  &c.  Ins.  Co.,  16  U.  C.  (C.  P.)  430. 
*  [Gould  V.  Holland  Purchase  Ins.  Co.,  16  Hun,  538,  540.] 
5  [Kimball  v.  Monarch  Ins.  Co.,  70  Iowa,  513.] 

614 


CH.  xiil]  title  and  incumbrance.  [§  294  6 

Paying  off  an  old  mortgage  and  giving  a  neiv  one.  —  If  the 
policy  is  conditioned  against  mortgaging  without  consent, 
the  paying  off  of  an  existing  mortgage  does  not  authorize  the 
giving  of  a  new  one,  however  small,  to  another  party. ^  But 
in  Iowa  it  is  held  that  if  at  the  time  of  insurance  there  is  a 
mortgage  on  the  property  and  this  is  subsequently  paid  off 
and  a  new  one  put  on,  the  question  is  whether  the  risk  has 
been  increased.  ^J 

§  294  a.  Notice.  —  [A  condition  in  a  policy  that  any  lien 
or  judgment  upon  the  property  insured  must  be  made  known 
to  the  company  or  the  policy  will  be  void,  is  a  warranty  on 
the  part  of  the  assured  that  must  be  strictly  complied  with.^ 
A  delay  of  giving  notice  for  fifty  days  after  mortgaging  the 
property  is  unreasonable  and  avoids  the  policy.  *]  Deposit- 
ing notice  in  the  mail  with  the  proper  address  is  prima  facie, 
and  only  prima  facie,  evidence  that  it  was  received.*  An 
indorsement  on  the  policy  that  the  loss  is  to  be  payable  to 
the  incumbrancer,  is  notice  that  the  property  is  incumbered. '^ 
[Although  the  by-laws  provide  that  notice  of  incumbrances 
shall  be  given,  yet  an  incumbrance  without  notice  will  not 
avoid  the  policy  unless  it  is  expressly  so  stipulated  either  in 
the  policy  or  the  organic  law.'^j 

§  294  h.  "Waiver. —  But  here,  as  in  other  cases  of  defective 
or  untrue  statements,  knowledge  of  the  untruth  at  the  time 
of  the  issue  of  the  policy  is  a  waiver  of  the  right  to  avoid 
the  policy  therefor.^  So  if  the  answer,  erroneous  in  fact,  is 
made  by  the  advice  of  the  agent  as  a  proper  answer;^  or  he. 


1  [Hankins  a;.Rockford  Ins.  Co.,  70  Wis.  1,  4.] 

2  [Russell  V.  Cedar  Rapids  Ins.  Co.,  71  Iowa,  69.] 

3  [Egan  V.  aiutual  Ins.  Co.,  5  Denio,  326,  328  ;  Seybert's  Adm.  v.  Penn.  Mut. 
Fire  Ins.  Co.,  103  Fa.  St.  282.] 

^  [McGowan  v.  People's  Mut.  Fire  Ins.  Co.,  54  Vt.  211.] 

5  Plath  V.  Minn.  Ins.  Co.,  23  Minn.  479. 

6  Insurance  Co.  v.  M'Dowel,  50  111.  120. 

^  [Tiefenthal  v.  Citizens'  Mut.  Fire  Ins.  Co.,  53  Mich.  306,  308-309.] 

8  Union  Ins.  Co.  v.  Chipp,  93  111.  96. 

»  iEtna,  &c.  Ins.  Co.  v.  Olmstead,  21  Mich.  246.  [The  omission  of  an  in- 
cumbrance caused  by  the  advice  of  the  agent  cannot  be  taken  advantage  of 
by  the  company  in  the  ab-sence  of  fraud.  Carr  v.  Fire  Ass.  Assoc,  14  Out.  R. 
487.] 

615 


§  294  C]         INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.      [CH.  XIII. 

being  duly  informed  of  the  facts,  neglects  to  make  the  proper 
statement  or  indorsement  of  the  facts  so  stated ;  ^  (a)  or  ad- 
justs the  loss.'-' 

[§  294  C.  It  has  been  held  that  a  policy  insuring  A.  B.  "  as 
his  interest  may  appear,"  waives  the  conditions  requiring  a 
specific  statement  of  such  interest  in  the  policy.^  An  agent 
to  solicit  insurance  and  issue  policies  countersigned  by  him- 
self, may  waive  the  condition  requiring  specification  that  the 
ground  is  leased.^  The  condition  as  to  sole  ownership  may 
be  waived,  but  not  so  as  to  make  the  policy  cover  goods  not 
described  in  it,  and  owned  by  persons  not  named  in  it.^ 
Where  the  company,  ten  days  after  issue  of  the  policy,  in- 
dorsed it  as  payable  to  the  mortgagee,  the  breach  of  con- 
dition as  to  ownership  which  the  formerly  undisclosed 
mortgage  constituted  was  held  to  be  waived.^  Although  the 
applicant  represents  that  there  is  no  incumbrance  when 
really  there  is  a  mortgage,  if  before  the  fire  a  new  mortgage 
is  substituted  for  the  old  one  and  the  company  assents  to 
the  new  one,  it  is  estopped  to  set  up  the  misrepresentation.^ 
Where  an  agent  made  out  the  application  in  his  office  in  the 
absence  of  the  plaintiff,  and  later  took  it  and  the  policy  made 
out  and  signed  to  the  plaintiff,  and  did  not  read  to  him  (he 
being  a  foreigner  and  unable  to  understand  English)  nor 
cause  to  be  translated  to  him  the  same,  but  told  him  it  was 
all  right,  and  obtained  his  signature;  if  no  inquiries  as  to 
incumbrances  were  made  of  the  plaintiff,  —  it  is  a  waiver  of 


1  Richmond  v.  Niagara  Fire  Ins.  Co.,  79  N.  Y.  230  ;  9  Ins.  L.  J.  117  ;  Smith 
V.  Commonwealth  Ins.  Co.,  49  Wis.  322. 

2  Eagan  v.  Mtn&,  &c.  Ins.  Co.,  10  W.  Va.  583.  See  also  Titus  v.  Glens  Falls 
Ins.  Co.  (N.  Y.),  9  Ins.  L.  J.  664  ;  Van  Schoick  v.  Niagara,  68  N.  Y.  434;  State 
Ins.  Co.  V.  Todd,  83  Pa.  St.  272. 

3  [De  Wolf  V.  Capital  City  Ins.  Co.,  16  Hun,  116,  118.] 
*  [Home  Ins.  Co.  v.  Duke,  84  Ind.  253.] 

6  [Fuller  i;.  Phrenix  Ins.  Co.,  61  Iowa,  350.] 

6  [Lewis  V.  Council  Bluffs  Ins.  Co.,  63  Iowa,  193.] 

7  [Lebanon  Mat.  Ins.  Co.  v.  Losch,  109  Pa.  St.  100.] 

\ 

(a)    "Indorsements  on  the  policy"    the  policy  is  issued.     Hoose  v.  Prescott 
of  the   title  or  changes  therein,  or  of    Ins.  Co.,  84  Mich.  309,  322. 
mortgages,  relate  to  transactions  after 

616 


CH.  XIII.]  TITLE    AND   INCUMBRANCE.  [§  29-4  E 

the  company's  right  to  have  the  plaintiif  disclose  the  fact  of 
a  mortgage  on  his  property. ^  (a)] 

[§  294  D.  Knowledge  of  the  Company.  —  A  description 
which  gives  the  company  constructive  notice  that  the  build- 
ings are  on  United  States  land,  destroys  the  condition  that 
the  insured  must  have  the  fee-simple. ^  If  the  policy  requires 
that  the  insured  shall  be  the  fee-simple  owner,  but  the  appli- 
cation which  is  made  a  part  of  the  policy  shows  clearly  that 
such  is  not  the  case,  the  condition  is  waived  by  the  issue  of 
the  policy  on  the  basis  of  the  application.^  If  the  applicant 
says  that  an  incumbrance  exists  without  stating  the  amount, 
the  issue  of  a  policy  waives  any  further  disclosure.^  When 
at  the  time  of  issuing  the  policy  the  company  knew  of  the 
existence  of  a  mortgage  on  the  insured  property,  they  can- 
not set  it  up  as  a  defence  to  an  action  on  the  policy  on  the 
ground  of  breach  of  warranty.^] 

[§  294  E.  Knowledge  of  the  Agent.  —  If  the  agent  knows 
at  the  time  of  issuing  the  policy  that  the  building  is  on 
leased  ground,  though  no  mention  is  made  of  the  fact  in  the 
application,  it  will  not  avail  the  company.  The  issue  of  a 
policy  on  a  known  state  of  facts  waives  all  conditions  incon- 
sistent therewith."  (b)    If  the  agent  read  the  lease,  the  policy 

1  [Geib  V.  Insurance  Co.,  1  Dillon,  443.] 

2  [Broadwater  v.  Lion  Fire  Ins.  Co.,  34  Minn.  465.] 

3  [Lamb  v.  Council  Bluffs  Ins.  Co.,  70  Iowa,  238.  See  however,  Eminence 
Mut.  Ins.  Co.  V.  Jesse,  1  Met.  (Ky.)  563  ;  supra,  §  289,  n.  3.] 

*  [Nichols  V.  Fayette  Mut.  Fire  Ins.  Co. ,  1  Allen,  63.] 

5  [Bidwell  V.  NoVth  West  Ins.  Co.,  24  N.  Y.  302,  304.] 

6  [Germania  Fire  Ins.  Co.  v.  Hick,  125  111.  361 ;  Phoenix  Ins.  Co.  v.  Copeland, 
86  Ala.  551 ;  Holmes  v.  Drew,  16  Hun,  491,  493  ;  Sentell  v.  Oswego  Co.  Farmer^ 
Ins.  Co.,  16  Hun,  516,  518  ;  Boetcher  v.  Hawkeye  Ins.  Co.,  47  Iowa,  253,  255.] 

{a)  If  the  applicant  is  not  asked  as  when  the   applicant  is  not  questioned 

to  existing  incumbrances,  his  failure  to  thereon,  especially  when  the  facts  are 

disclose  an   existing   mortgage   on   the  known  to  the  insurer's  agent.     Cross  v. 

property   is   not    such    concealment   or  National  F.   Ins.  Co.,   132  N.  Y.  133. 

misrepresentation  as  avoids  the  policy.  Intent  to  deceive  the  insurer  is  not  pre- 

Koshland  v.  Hartford  Ins.  Co.,  31  Ore-  sumed  from  the  simple  fact  of  falsity  in 

gou.  402  ;  Seal  v.  Farmers'  &  Merchants'  a  statement  by  the  insured.     Dolan  v. 

Ins.    Co.    (Neb.),  80  N.   W.    807;  see  Mutual  Reserve  Fund  Life  Ass'n,  173 

Sproul  V.  Western  Ass.  Co.,  33  Oregon,  Mass.  197. 

98.     So  conditions  in  the  policy  as  to  (b)  London  &   L.  Fire  Ins.   Co.  v. 

title  and  vacancy  are  deemed  waived,  Fischer,  92  F.  500. 

617 


§  294  E]         INSUKANCE:   FIKE,   LIFE,   ACCIDENT,    ETC.         [CH.  XIII. 

cannot  be  avoided  on  the  ground  that  the  interest  of  the 
assured  was  not  a  fee-simple,  or  that  the  lessor  had  by  the 
lease  a  lien  on  the  buildings  for  the  rent.  ^  When  the  assured 
had  a  fee-simple  title  subject  to  a  |;10,000  incumbrance, 
which  was  known  to  the  agent,  but  the  assured  answered 
"fee-simple  "  in  response  to  the  question  as  to  interest,  and 
it  so  appeared  in  the  policy,  it  was  held  that  the  policy  was 
not  avoided,  though  it  contained  a  forfeiture  clause  if  the 
question  should  be  wrongly  answered. ^  Parol  evidence  is 
admissible  to  show  that  the  assured  stated  to  the  company's 
agent  that  there  was  an  incumbrance  on  the  property,  al- 
though the  policy  declares  there  is  none.^  The  applicant 
stated  to  the  agent  that  he  was  in  possession  under  a  con- 
tract for  purchase.  The  policy  contained  no  such  state- 
ment, but  was  conditioned  to  be  void  if  the  insured  was  not 
the  sole,  absolute,  and  unconditional  owner,  and  also  pro- 
vided that  no  agent  of  the  company  should  be  held  to  have 
waived  any  condition  of  the  policy  unless  such  waiver  were 
indorsed  thereon.  It  was  held  that  the  company  was  es- 
topped by  the  knowledge  of  the  agent,  (a)  The  court  said, 
quoting  a  former  case :  "  The  principle  that  if  statements  in 
the  application,  relied  upon  as  breaches  of  warranty,  are  in- 
serted by  the  agent  of  the  insurers  without  any  collusion  or 
fraud  on  the  part  of  the  insured,  the  insurer  is  estopped 

1  [Dresser  v.  United  Firemen's  Ins.  Co.,  45  Hun,  298.] 

2  [Home  Mut.  Fire  Ins.  Co.  v.  Garfield,  60  111.  124,  127.] 

3  [Boetcher  v.  Hawkeye  Ins.  Co.,  47  Iowa,  243,  25,5.] 

(a)  See  London  &  L.  F.  Ins.  Co.  v.  v.  Security  F.  Ins.   Co.,  99  Iowa,  382 ; 

Fischer,  92  Fed.  Rep.  500 ;  Ins.  Co.  of  Greenlee   v.    Iowa  State   Ins.   Co.,    102 

North  America  v.  Bachler,  44  Neb.  549 ;  Iowa,  260  ;  Robbins  v.  Springfield  F.  & 

McGonigle  v.  Susquehanna  Mut.  F.  Ins.  M.  Ins.  Co.,  149  N.  Y.  477  ;  Frane  v. 

Co.,    168   Penn.   St.  1 ;   McGonigle  v.  Burlington    Ins.   Co.,    87    Iowa,    288 ; 

Agricultural    Ins.    Co.,    167    id.    364  ;  Beebe   v.    Ohio    Farmers'  Ins.  Co.,   93 

Sproul  V.  Western  Ass.  Co.    (Oregon),  Mich.  514;  McFetridge  v.  American  F. 

54Pac.  180;  Phenix  Ins.  Co.  v.  Hart,  Ins.    Co.,   90  Wis.   138;  McFarland  v. 

149    111.    513  ;    Summerfield   v.   North  Kittanning  Ins.  Co.,  134  Penn.  St.  590  ; 

British  &  Merc.   Ins.  Co.,  62  Fed.  Rep.  Bosworth  v.  Merchants'  F.  Ins.  Co.,  80 

249  ;  PhcBnix  Ins.  Co.  v.  Warttemberg,  Wis.  393  ;  Gristock  v.  Royal  Ins.  Co., 

79  id.  245  ;  McElroy  v.  British  America  87  Mich.  428  ;  Lyon  v.  Dakota  Ins.  Co., 

Ass.  Co.,  94  id.  990  ;  Arthur  v'.  Palatine  6  Dak.  67. 
Ins.  Co.  (Oregon),  57  Pac.  62 ;  Corkery 

618 


CH.  XIII.]  TITLE   AND   INCUMBRANCE.  [§  294  E 

from  setting  up  their  error  or  falsity,  seems  now  well  set- 
tled." ^  Where  the  insured,  B.,  told  the  agent  that  the 
property  belonged  to  his  wife,  but  the  agent,  contrary  to 
instructions  and  without  the  knowledge  of  B.  made  the  pol- 
icy in  B. 's  name,  it  was  held  that  B.  could  sue  in  his  own 
name  for  the  use  of  his  wife,  though  the  policy  contained  a 
provision  that  if  the  insured  is  not  the  absolute  owner  the 
fact  must  be  expressed  in  writing  on  the  policy. ^  And  where 
a  husband  took  out  insurance  on  his  wife's  property  in  his 
own  name,  the  agent  knowing  the  facts  and  failing  to  state 
the  wife's  interest  in  the  policy,  it  was  held  that  the  com- 
pany was  chargeable  with  his  knowledge,  and  the  husband 
could  sue  in  his  own  name  for  his  wife's  loss.^  Orally  the 
applicant  stated  all  incumbrances.  The  agent,  without 
knowledge  of  applicant,  made  out  an  application  omitting 
the  incumbrances.  It  was  held  that  the  applicant  was  not 
bound  by  the  written  application,  and  that  there  was  no 
breach  of  the  condition  in  the  policy  requiring  statement  of 
incumbrances  in  the  application.*  When  the  assured  stated 
in  his  application  that  there  were  no  incumbrances  on  the 
property,  and  on  the  trial  the  defendants  proved  that  there 
were,  evidence  was  held  admissible  to  explain  that  the  com- 
pany's agent  knew  of  this  at  the  execution  of  the  policy.^ (a) 

1  [Miaghan  v.  Hartford  Fire  Ins.  Co.,  24  Hun,  58,  60.  See  also  Mark  v.  Na- 
tional Fire  Ins.  Co.,  24  Hun,  565.  The  policy  contained  a  similar  clause  as  to 
■whole  ownership,  and  the  agent  knew  that  Mark  was  not  sole  owner  of  the  boat 
insured.  ] 

2  [Deitz  V.  Insurance  Co.,  31  W.  Va.  851.] 

3  [Hunt  V.  Mercantile  Ins.  Co.,  22  Fed.  Rep.  503  (Mo.)  1884.] 
*  [Benninghoff  v.  Agricultural  Ins.  Co.,  93  N.  Y.  495.] 

5  [Patten  v.  Merchants'  &  Fanners'  Mut.  Fire  Ins.  Co.,  40  N.  H.  375,  380.] 

(a)  The  insurer's  agent  may  waive  Bank,  id.  449  ;  Carpenter  v.  German 
unconditional  ownership.  Bateman  v.  American  Ins.  Co.,  135  N.  Y.  298  ; 
Lumbermen's  Ins.  Co.,  189  Penn.  St.  McMurray  v.  Capital  Ins.  Co.,  87  Iowa, 
465  ;  Breedlove  v.  Norwich  Union  F.  453  ;  Robison  v.  Ohio  Farmers'  Ins.  Co., 
Ins.  Co.,  124  Cal.  164;  London  &  L.  F.  93  Mich.  533.  Where  the  policy  re- 
Ins.  Co.  V.  Gerteson  (Ky.),  28  Ins.  L.  J.  quires  a  mortgagee  to  notify  the  insurer 
653  ;  Graham  v.  American  F.  Ins.  Co.,  of  change  of  title  or  increase  of  risk, 
48  S.  C.  195  ;  Dupuy  v.  Delaware  Ins.  and  to  have  the  same  indorsed  on  the 
Co.,  63  Fed.  Rep.  680;  Rockford  Ins.  policy,  notice  thereof  to  a  former  agent, 
Co.  V.  Farmers'  State  Bank,  50  Kansas,  given  in  ignorance  that  his  agency  had 
427  ;    Capital   Ins.   Co.   v.    Pleasanton  ceased,  is  a  sufficient  compliance  with 

619 


§  294  F]       INSURANCE  :   FIKE,   LIFE,   ACCIDENT,   ETC.         [CH.  XIII. 

Where  the  statement  of  the  assured  does  not  amount  to  a 
warranty  and  was  made  without  fraud,  knowledge  of  the 
agent  binds  the  company.  A  report  of  the  agent  stating 
that  there  are  no  incumbrances  subsequent  to  the  applica- 
tion, and  without  knowledge  of  the  assured,  does  not  bind 
the  latter.^  But  if  a  warranty  that  there  are  no  incum- 
brances is  written  with  the  assent  of  the  insured,  who  states 
to  the  agent  that  he  don't  know  for  certain  whether  there 
are  any  or  not,  and  the  statement  turns  out  untrue,  the  pol- 
icy is  void.  The  fact  that  the  agent  was  a  director  is  im- 
material; there  is  a  clear  breach  of  warranty. ^  And  failure 
at  the  trial  to  prove  the  title  which  the  insured  told  the 
agent  he  possessed,  it  appearing  on  the  contrary  that  the 
title  to  the  property  is  in  another,  will  prevent  recovery  by 
the  insured.^] 

[§  294  F.  On  the  other  hand,  it  has  been  held  that  if  the 
policy  prohibits  waiver  by  the  agent,  the  assured  is  bound 
by  the  provision,  and  an  attempted  waiver  of  the  condition 
against  incumbrance  will  not  avail.*  In  the  absence  of 
fraud  or  mistake,  a  party  will  not  be  heard  to  say  he  was 
ignorant  of  the  contents  of  a  document  signed  by  him  with- 
out compulsion.^     Where  the  applicant  told  the  agent  that 

1  [Phenix  Jus.  Co.  v.  LaPointe,  17  Brad.  248.] 

2  [Blooming  Grove  Mat.  Fire  Ins.  Co.  v.  McAnerney,  102  Pa.  St.  335.] 

3  [Carpenter  v.  German-American  Ins.  Co.,  52  Hun,  249.] 
*  [Hankins  v.  Rockford  Ins.  Co.,  70  Wis.  1.] 

6  [Cuthbertson  v.  Insurance  Co.,  96  N.  C.  480.] 

such  stipulation.    Whitney  r.  American  Wooliver  v.    Boylston    Ins.     Co.,    104 

Ins.  Co.  (Cal. ),  56  Pac.  50.     Knowledge  Mich.  95;  Home   Ins.   Co.    v.   Gibson, 

of  .such  an  agent,  when  the  insurance  is  72  Miss.  58  ;  Westchester  F.  Ins.  Co.  v. 

effected,  of  the  state  of  the  title,  when  Wagner,   10  Tex.  Civ.  App.  398.     But 

acquired  verbally  or  by  the  answers  in  written  statements  of  the  agent,  with- 

the  application,  is  equivalent  to  actual  out  such  knowledge,  do  not  bind  the 

notice  given  by  the  insured,  and  over-  company.     Cornell  v.  Tiverton  Mut.  F. 

rides    the    conditions    in    the    policy.  Ins.  Co.  (R.  I.),  35  Atl.  Rep.  579.     A 

Cowart  V.   Capital  City   Ins.   Co.,  114  defect  in  pleading  on  a  fire  policy,  in 

Ala.   356 ;  Schaeffer  v.   Farmers'  M.  F.  not  stating  the  plaintiff  to  be  owner,  is 

Ins.  Co.,  80  Md.  563  ;  Home  Ins.  Co.  v.  cured  by  a  verdict  in  his  favor.     West- 

Mendenhall,    168    111.   458;    Davis    v.  ern   Ass.   Co.   v.   Ray  (Ky.),   49  S.  W. 

Phcenix  Ins.  Co.,  Ill  Cal.  409  ;  Parsons  326  ;  but  see  Western  Ass.  Co.  v.  Mc- 

V.  Knoxville  F.  Ins.  Co.,  132  Mo.  583  ;  Carty,  18  Ind.  App.  449. 

620 


CII.  XIIT.]  TITLE    AND   INCUMBKANCE.  [§  294  G 

there  was  a  mortgage  on  the  land,  but  none  on  the  house 
which  he  held  in  fee  unincumbered,  and  the  application  said 
"title  in  fee"  and  "no  incumbrance,"  it  was  held  that  the 
policy  was  void  for  non-disclosure  of  incumbrances,  the  house 
being  insured  not  as  a  chattel  but  as  realty.  Armour,  J., 
however,  properly  dissented,  holding  that  the  house  was 
really  a  chattel  resting  merely  on  blocks,  and  that  the  mort- 
gage was  not  in  the  least  material.^] 

[§  29-1  G.  No  "Waiver  or  Estoppel.  —  When  the  policy  pro- 
vides that  if  the  interest  of  the  assured  be  other  than  sole, 
unconditional,  &c.,  it  must  be  so  expressed  in  the  policy, 
the  insured  if  owner  otherwise  than  as  above  must  state  his 
interest,  and  the  fact  that  the  agent  made  no  inquiry  and 
the  assured  no  statement  of  the  same,  is  not  a  waiver  by  the 
company. 2  A  vote  of  the  company's  directors,  authorizing 
one  of  their  number  to  settle  the  claim,  part  payments  made 
by  them  to  plaintiff's  creditors  when  summoned  as  trustee, 
and  the  statements  of  one  of  the  directors  that  the  claim 
ought  to  be  paid,  —  will  not  estop  them  from  defending 
against  the  action  ^  of  the  assured,  on  the  ground  of  fraudu- 
lent and  untrue  statements  as  to  incumbrances  in  the  appli- 
cation, which  is  part  of  the  policy,  if  the  assured  has  not 
changed  his  position  in  consequence  of  the  action  of  the 
company.  Failure  to  state  that  the  ground  is  leased  is  fatal 
to  a  policy  requiring  such  statement,  and  employment  of  an 
adjuster  by  the  company  before  it  knows  of  the  plaintiff's 
title,  is  not  a  waiver.*  A  verbal  agreement  during  the  nego- 
tiations that  the  insured  may  mortgage  the  premises  at  a 
future  day,  which  agreement  is  not  mentioned  in  the  policy, 
is  no  part  of  the  contract  of  insurance,  and  if  the  insured 
does  so  mortgage,  the  condition  against  incumbrances  is 
violated.^] 

1  [Phillips  V.  Grand  Riv.  F.  Mut.  Fire  Ins.  Co.,  46  U.  C.  R.  (Q.  B.)  334.] 

2  [Waller  v.  Northern  Ass.  Co.,  10  Fed.  Rep.  232,  235;  2  McCrary,  637; 
8th  Cir.  Iowa,  1881.] 

3  [Murphy  v.  People's  Eq.  Mut.  Fire  Ins.  Co.,  7  Allen,  239.] 

*  [Security  Ins.  Co.  v.  Mette,  27  Brad.  324  ;  Illinois  Mut.  Ins.  Co.  v.  Mette, 
Id.  330.] 

6  [McNierney  v.  Agricultural  Ins.  Co.,  48  Hun,  239.     See  §  192.] 

621 


INSUKANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.        [CH.  XIV. 


CHAPTER  XIY. 

HEALTH,    HABITS,    AGE,    ETC, 

Analysis. 

§  295.  "  Good  health"  and  "sound  health  "  mean  reasonable,  not  fcrfed 

health.  A  healthy  life  is  one  insurable  at  ordinary  rates. 
Freedom  from  serious  disease  is  sufficient.  Slight  dys- 
pepsia no  breach  of  the  warranty,  but  Bright's  disease 
or  drunkenness  fatal.  Tendency  to  shorten  life  means 
substantial  tendency  ;  all  disorders  do  so  in  some  degree. 
Wound  affecting  bladder,  spasms,  gout,  dyspepsia. 
Consumption. 

Honest  answers  liberally  construed. 
§  296.  "  Tendency  to  shorten  life  ; "  drunkenness  a  breach  of  the  warranty 

"no  habit  obviously  tending  to  shorten  life." 
Serious  illness  or  injury  is  one  that  permanently  impairs  the  con- 
stitution and  increases  the  risk.  No  absolute  test  is  possi- 
ble. It  has  been  said  that  an  honest  belief  in  the  truth  of 
the  answer  is  all  that  is  required  ;  but  there  is  authority 
that  due  care  must  be  exercised  in  forming  the  belief  (see 
also  next  section).  Failure  to  speak  of  illnesses  so  slight  as 
to  be  beyond  tlie  reasonable  contemplation  of  the  parties,  is 
of  no  effect.  "Hereditary  disease,"  "local  disease,"  "dis- 
ease requiring  confinement."  Malaria,  rupture,  tubercles, 
sunstroke,  pneumonia.  Company  must  show  not  only 
insanity  in  ancestor,  but  also  that  it  is  hereditary. 
§  297.  The  insured   must  answer  in   good  faith   and   according  to   the 

knowledge  he  has,  or  as  an  ordinarily  intelligent  man  should 
have,  about  himself.     Knowledge  of  the  life-subject  is  im- 
putable to  the  assured  if  he  undertake  for  the  truth  of  the 
"life's"  statements,  §  297.     Fits,  gout,  vertigo. 
False  answer  to  a  specific  question  avoids  the  policy,  though 
the  matter  was  not  material,  otherwise  with  a  mere 
want  of  fulness,  §  300. 
§  298.  "Afflicted  with  disease."     Consumption,  spitting  of  blood, 

&c. 
fits,  diseases  of  liver  or  throat. 
§  299.  Habit  is  a  question  for  the  jury.     Means  more  than  a  single 

excess,  but   does   not   require  daily  and   continuous 
use.     Intemperance,  opium  ;  see  also  §§  300-302. 
§  301.  If  death  by  intemperance  is  to  avoid  the  contract,  the  death  must 

be  traced  clearly  to  intemperance  as  the  proximate  cause. 
Neither  intemperance  combined  with  other  causes,  nor  as 
a  predisposing   cause,  will   avoid   the   policy.     If  delirium 

622 


CH.  XIV.]  HEALTH,    HABITS,   AGE,    ETC,  [§  295 

tremens  with  care  and  skill  might  not  have  been  mortal, 
but  by  over-doses  of  morphine  the  man  died,  intemperance 
is  not  the  proximate  cause  of  death.  If  excess  of  liquor 
not  taken  by  medical  advice  impairs  the  health  or  causes 
death  though  without  delirium,  the  policy  is  void,  though 
the  insured  was  not  habitually  intemperate,  or  had  even 
been  habitually  temperate  up  to  the  fatal  debauch. 
Medical  Examination. 
§  303,  Statements  in  regard  to  applicant's  wealth,  &c.,  made  at 

such  examination  may  be  material. 
If  examiner  misleads  assured  into  making  a  wrong  answer, 
or  writes  a  false  one  without  assured's  knowledge,  the 
company  is  estopped, 
the  applicant  is  not  bound  by  the  doctor's  opinions, 
if  the  conij)any  issues  a  policy  knowing  the  examiner  is 
the  beneficiarj',  he  will  not  have  to  prove  the  transac- 
tion fair  and  just. 
§  304.  "Family  physician,"  "medical  attendance,"  &c. 

a  warranty  that  insured  had  not  consulted  a  physician  is 
broken  by  a  con'sultation,  though  only  for  a  cold. 
§  305.  Age,   misstatement   fatal.     Agent's   knowledge   esto[is   company  ; 

so  if  applicant  says  he  don't  know  and  the  agent  makes 
his  own  estimate.     Residence.     Prison.     Relationship. 
§  306.  Occupation  at  the  time  must  be  stated,  not  that  of  the  past ;  see 

also  §  188  A. 
but  all  occupations  need  not  be  stated  ;  one  is  enough  (qucere  as 
to  fairness  of  this  rule  ;  the  one  omitted  may  be  more  haz- 
ardous than  the  one  stated). 

§  295.     Good    Health ;    Healthy    Life ;    Tendency    to    shorten 

Life.  —  In  the  early  history  of  life  insurance  in  England,  and 
before  the  officers  had  acquired  the  art  or  indeed  seen  the 
necessity  of  hedging  the  insured  about  with  warranties,  in 
Ross  V.  Bradshaw,^  it  was  held,  by  Lord  Mansfield,  that  a 
warranty  of  good  health  meant  simply  that  the  applicant 
was  in  a  reasonably  good  state  of  health,  and  was  such  a 
life  as  ought  to  be  insured  on  common  terms, ^     That  it  did 

1  1  w.  Bl.  312  A.  D.  1760. 

-  [A  warranty  of  the  health  of  a  third  person  does  not  require  absolute  free- 
dom from  illness  or  disease,  but  only  that  the  person  does  not  manifest  symp- 
toms of  disease,  and  to  the  ordinary  observation  of  a  friend  or  relative,  is  well. 
Grattan  v.  Mut.  Life  Ins.  Co.,  92  N.  Y.  274.  Sound  health  does  not  mean  abso- 
lute freedom  from  infirmity,  slight  dyspepsia  yielding  readily  to  treatment  and 
not  known  to  be  organic  and  excessive,  is  not  inconsistent  with  such  a  represen- 
tation. Morrison  v.  Wisconsin  0.  F.  Mut.  Life  Ins.  Co.,  59  Wis.  162.  "Sound 
health  "  means  freedom  from  serious  disease,  or  grave,  important,  weighty  trouble, 
A  mere  indisposition  that  does  not  tend  to  undermine  the  constitution,  may 
exist,  but  Bright's  disease  is  serious  and  dangerous,  and  inconsistent  with  sound 

623 


§  295]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.         [CH.  XIV- 

not  mean  that  he  was  free  from  every  infirmity,  and  in  fact 
though  he  had  one,  the  life  might  be  a  good  one ;  and  the 
fact  that  insured  had  several  years  before  received  in  battle 
a  wound  in  the  loins  which  so  affected  him  that  he  could  not 
retain  his  urine  or  fseces,  though  not  mentioned,  was  not 
inconsistent  with  a  good  insurable  life.  And  about  twenty 
years  later,  in  Willis  v.  Poole, ^  where  it  appeared  the  insured 
was  at  times  troubled  with  spasms  from  violent  fits  of  the 
gout,  though  at  the  time  of  insurance  in  his  usual  state  of 
health.  Lord  Mansfield  said :  "  The  imperfection  of  language 
is  such  that  we  have  not  words  for  every  different  idea,  and 
the  real  intention  of  the  parties  must  be  found  out  by  the 
subject-matter.  By  the  present  policy  the  life  is  warranted 
to  some  of  the  underwriters,  in  health;  to  others,  in  good 
health.  And  yet  there  is  no  difference  in  point  of  fact. 
Such  a  warranty  can  never  mean  that  a  man  has  not  in  him 
the  seeds  of  some  disorder.  We  are  all  born  with  the  seeds 
of  mortality  in  us.  A  man  subject  to  the  gout  is  a  life  cap- 
able of  being  insured,  if  he  has  no  sickness  at  the  time  to 
make  it  an  unequal  contract."  In  Watson  v.  Mainwaring^ 
there  was  a  warranty  that  the  insured  was  free  from  any 
"disorder  tending  to  shorten  life,"  while  in  fact  the  appli- 
cant was  afflicted  with  a  disorder  of  the  bowels,  which  might 
proceed  either  from  a  defect  of  the  internal  organs,  which 
would  tend  to  shorten  life,  or  it  might  proceed  from  dys- 
pepsia, which  would  not,  unless  organic  and  excessive ;  and 
it  was  left  to  the  jury  to  say  whether  it  was  dyspepsia  or 
not,  and,  if  so,  whether  it  was  organic  and  excessive.  "  All 
disorders,"  said  Chambre,  J.,  "have,  more  or  less,  a  ten- 
dency to  shorten  life ;  even  the  most  trifling,  —  corns  may 

health.  Brown  v.  Metropolitan  Life  Ins.  Co.,  65  Mich,  306.  A  warranty  of 
good  health  does  not  require  perfect  and  absolute  health.  No  definite  rule  can 
he  laid  down  for  the  determination  of  the  matter.  It  becomes  usually  a  question 
for  the  jury  on  all  the  facts.  When  there  are  no  reasonable  grounds  to  suspect 
fraud,  the  questions  and  answers  should  be  liberally  construed  in  favor  of  the 
assured.  Maine  Benefit  Ass.  v.  Parks,  81  Me.  79.  See,  for  general  discussion 
as  to  representations  concerning  health,  Hoffman  r.  Supr.  Council  of  American 
Legion  of  Honor,  35  Fed.  Rep.  252  (Va.),  1888.] 

1  2  Parke,  Ins.  650. 

a  4  Taunt.  763. 
624 


CH.  XIV.]  HEALTH,   HABITS,   AGE,    ETC.  [§  295 

end  in  mortification.  That  is  not  the  meaning  of  the  clause. 
If  dyspepsia  were  a  disorder  that  tended  to  shorten  life 
within  the  exemption,  the  lives  of  half  the  members  of  the 
profession  of  the  law  would  be  uninsurable."  A  disease 
tending  to  shorten  life  is  one  which  has  a  continuing  ten- 
dency, and  not  stating  one  which  might  or  might  not  have 
produced  that  result  is  no  concealment.^  Of  course  if  there 
is  no  warranty  the  insurers  take  every  risk,  where  there  is 
no  fraud,  as  by  misrepresentation  or  concealment.^  "Good 
health  "  does  not  import  a  perfect  physical  condition.  The 
epithet  "  good  "  is  comparative,  and  does  not  ordinarily  mean 
that  the  applicant  is  free  from  infirmities.  Such  an  inter- 
pretation would  exclude  from  the  list  of  insurable  lives  a 
large  proportion  of  mankind.  The  term  must  be  interpreted 
with  reference  to  the  subject-matter  and  the  business  to 
which  it  relates.  Slight  troubles,  not  usually  ending  in 
serious  consequences,  and  so  unfrequently  that  the  possibil- 
ity of  such  result  is  usually  disregarded  by  insurance  com- 
panies, may  be  regarded  as  included  in  the  term  "good 
health. "  ^  Good  health  means  apparent  good  health,  with- 
out any  ostensible,  or  known,  or  felt  symptom  of  disorder, 
and  does  not  exclude  the  existence  of  latent  unknown  de- 
fects.* The  fact  that  death  may  ensue,  and  in  fact  does  un- 
expectedly ensue  in  the  particular  case,  from  one  of  these 
slight  troubles,  or  from  the  disease  which  the  applicant  has 
represented  ,that  he  did  not  have  nor  never  had,  is  of  little 
importance.^  But  a  predisposition  to  a  disease,  —  dyspep- 
sia, for  instance,  —  of  such  a  character  and  to  such  a  degree 
as  to  seriously  affect  the  health  and  to  produce  bodily  in- 
firmity, is  incompatible  with  a  warranty  of  good  health.^ 

1  Rose  V.  Star  Ins.  Co.,  2  Irish  Jurist,  o.  s.  206. 

2  Stackpole  v.  Simon,  2  Parke,  Ins.  648. 

3  Peacock  v.  N.  Y.  Life  Ins.  Co.,  20  N.  Y.  293,  affirming  s.  c.  1  Bosw.  (X.  Y. 
Superior  Ct.)  338. 

*  Hutchinson  v.  Nat.  Loan  Ass.  Soc,  7  Ct.  of  Sess.  (Scotch)  2d  ser.  467  ;  .s.  c. 
2  Big  Life  &  Ace.  Ins.  Cas.  444. 

^  Watson  V.  Mainwaring,  4  Taunt.  763  ;  Fahrenkrug  v.  Electric  &c.  Ins.  Co., 
68  in.  463.     See  also  Ellington  v.  .Etna  Life  Ins.  Co.,  77  N.  Y.  564. 

6  New  York  Life  Ins.  Co.  v.  Flack,  3  Md.  341. 

VOL.  I.  — 40  625 


§  296]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  XIV. 

The  fact,  however,  that  some  six  months  or  a  year  previous 
to  the  insurance  the  applicant  had  suffered  from  dyspepsia 
while  afflicted  with  an  abscess  is  not  conclusive  evidence  of 
a  breach  of  warranty  that  he  was  not  "subject  to  dyspep- 
sia."^ Nor  is  the  fact  that  a  man  was  pardoned  out  of  the 
State  prison  on  the  ground  that  he  had  had  hemorrhage  of 
the  lungs  conclusive  evidence  that  some  months  afterwards 
he  had,  as  a  disease,  consumption,  hemorrhage  of  the  lungs, 
or  spitting  of  blood.^  A  "healthy  life"  is  a  good  life,  one 
that  would  be  taken  at  common  rates ;  and  one  which  would 
be  charged  higher  than  the  usual  rate  of  premium  is  not  a 
healthy  life.^  And  a  "drunken  fellow"  is  not  a  good  life.* 
Equivocation  in  the  answers  touching  health  is  of  course  as 
fatal  as  falsehood.^  [Where  the  questions  were,  "State  so 
far  as  you  know  what  was  the  age  at  death,  cause  of  death, 
&c.,  of  each  of  the  following  persons  if  deceased.  What  is 
the  age  and  present  state  of  health  of  each  of  them  if  now 
living  ?  Are  you  now  in  good  health  and  is  your  health 
usually  good  ? "  it  was  held  that  "  so  far  as  you  know  "  did 
not  qualify  the  last  question,  and  as  the  answers  were  made 
warranties  any  falsity  in  fact  in  the  answer  to  the  last  ques- 
tion would  avoid  the  policy.^] 

§  296.  Serious  Illness  ;  Serious  Injury  ;  Tendency  to  shorten 
Life;  Local  Disease.  —  The  ordinary  question  whether  the 
applicant  has  ever  had  any  serious  illness  —  as  the  word 
"serious"  is  a  relative  term,  involving  a  question  of  degree, 
and  it  being  certain  that  there  are  all  degrees  of  illness, 
from  the  slightest,  about  which  no  concern  is  felt  by  any 
one,  to  the  most  aggravated,  attended  by  the  most  alarming 
developments  and  the  most  serious  consequences,  about  which 
there  is  everywhere  the  highest  degree  of  concern,  and  as 

1  World,  &c.  Ins.  Co.  v.  Schiiltz,  73  111.  586. 

2  Equitable  Life  Ins.  Co.  v.  Patterson,  C.  Ct.  (Mass.)  10  Ins.  L.  J.  384. 
8  Brealey  v.  Collins,  1  Yon.  317  ;  Ross  v.  Bradshaw,  1  W.  Bl.  312.     • 

*  Weskett,  Ins.  335.  In  Taylor's  Medical  Jurisprudence  may  be  found  many 
valuable  suggestions  on  the  subject  of  representation  as  to  health  and  disease 
and  personal  habits,  with  references  to  some  cases  not  elsewhere  repotted. 
Phila.  ed.  1866,  738  et  scq. 

6  Smith  V.  mna  Life  Ins.  Co.,  49  N.  Y.  211. 

6  [Mayer  v.  Equit.  Reserve  Fund  L.  Ass.,  49  Hun,  336.] 

626 


CH.  XIV.]  HEALTH,   HABITS,    AGE,   ETC.  [§  296 

even  a  disease  regarded  in  its  course  as  oi  the  most  trivial 
in  its  character  may  be  followed  by  the  most  serious  results 
—  seems  to  be  a  question  of  opinion,  the  expression  of  which 
should  be  based  upon  intelligence  and  good  faith.  Nor  does 
it  include  the  ordinary  malarial  diseases  of  the  neighboring 
country,  which  yield  readily  to  medical  treatment,  and  when 
ended  leave  no  permanent  injury  to  the  physical  system;  but 
refers  to  those  severe  attacks  which  often  leave  a  permanent 
injury  and  tend  to  shorten  life,  and  which  might  be  fairly 
regarded  as  likely  to  influence  the  insurers  in  determining 
whether  they  would  insure.'  [Excessive  drinking  of  liquor 
is  a  violation  of  a  warranty  that  the  insured  "will  not  prac- 
tise any  pernicious  habit  that  obviously  tends  to  shorten 
life.  "2]  Whether  the  injury  is  serious  or  not  depends  as 
much  upon  the  impression  produced  at  the  time  when  it 
happened  as  upon  its  history  and  consequences.^  What  one 
may  call  serious  another  might  not;  and  where  there  is  no 
test  furnished  by  the  insurers  by  which  the  applicant  can 
know  what  serious  illness  means,  his  failure  to  mention  one 
which  he  does  not  regard  as  serious  works  no  forfeiture  of 
the  policy,  though  in  fact  the  illness  not  mentioned  was  a 
serious  one.^  A  "serious  illness"  must  be  one  which  per- 
manently impairs  the  constitution  and  renders  the  risk  more 
hazardous,^  So,  if  the  inquiry  be  as  to  the  prior  existence 
of  disease  having  a  tendency  to  shorten  life,  or  rendering  an 
assurance  upon  it  more  than  usually  hazardous.  An  honest 
belief  in  the  truth  of  his  answer  is  all  that  is  required  of  the 
applicant.*'     He  may  have  had  repeated  attacks  of  disease, 

1  Holloman  v.  Lile  Ins.  Co.,  1  Woods  (U.  S.  C.  Ct.),  674. 

2  [Schultz  V.  I\Iut.  Life  Ins.  Co.,  10  Ins.  L.  J.  171,  2d  Cir.  (N.  Y.)  1881  ; 
Brockway  v.  Mut.  Betietit  Life  Ins.  Co.,  id.  762.] 

3  Insurance  Co.  v.  Wilkinson,  13  Wall.  (U.  S.)  222.     And  see  post,  §  539. 

*  Hogle  V.  Guardian  Life  Ins.  Co.,  6  Rob.  (X.  Y.  Superior  Ct.)  567  ;  Hollo- 
man  V.  Life  Ins.  Co.  (C.  Ct.),  1  Woods,  674. 

5  Illinois  Mason's  Soc.  v.  Winthrop,  85  111.  537.     See  also  a7ife,  §§  193,  210. 

6  [Where  the  applicant  was  required  to  state  whethei'  he  had  had  certain  dis- 
eases, and  he  replied  that  he  had  not,  the  court  held  u]ion  examination  of  the 
whole  policy  that  the  intent  was  only  to  require  good  faith,  and  that  although 
the  insured  might  have  had  one  or  more  of  the  diseases,  —  scrofula,  asthma,  and 
consumption,  in  this  case,  — yet  if  at  the  time  of  application  he  did  not  know  or 
believe   that  he  had  ever  been  afflicted  with  either  of  them  in  a  sensible,  appre- 

627 


§  296]        insurance:  fire,  life,  accident,  etc.       [ch.  xiv. 

but  if  he  does  not  know  or  have  reason  to  believe  that  they 
come  within  the  range  of  the  inquiry,  his  failure  to  answer 
is  immaterial,  even  though  in  point  of  fact  they  had  a  ten- 
dency to  shorten  life  and  to  increase  the  hazard  of  the  risk.^ 
In  such  cases  the  rule  seems  to  be  that  if  the  inquiry  call  for 
an  answer  which  involves  a  matter  of  opinion,  the  applicant 
is  answerable  only  for  the  honesty  of  his  opinion,  although 
the  answer  be  untrue  in  fact.  So,  where  it  was  untruly 
stated  that  the  party  had  not  had  rupture.^  And  substan- 
tially the  same  rule  was  laid  down  in  Hutchinson  v.  National 
Loan  Assurance  Society,^  where  the  inquiry  was  whether  any 
material  circumstances  touching  health  or  habits  of  life  with 
which  insurers  ought  to  be  made  acquainted  was  withheld, 
and  it  was  decided  that  the  answer  was  only  a  warranty  to 
the  extent  of  the  knowledge  and  reasonable  belief  of  the  in- 

ciable  form,  the  policy  was  not  avoided.  Moulor  v.  American  Life  Ins.  Co.,  Ill 
U.  S.  339,  340.  It  has  been  held,  however,  that  if  the  plaintiff  has  Bright's  dis- 
ease so  well  defined  as  to  cause  functional  derangement,  the  policy  is  void  whether 
the  plaintiff  knew  of  the  disease  or  not.  An  ailment,  however,  which  produces 
no  functional  disorder,  and  of  which  the  person  affected  is  unconscious,  can  hardly 
he  called  a  disease  within  the  meaning  of  an  insurance  contract.  Continental  Life 
Ins.  Co.  r.  Yung,  113  Ind.  159.  In  construing  the  question  "Have  you  had 
any  .  .  .  open  sores,  lumps,  or  swellings  of  any  kind,  .  .  .  or  any  malformation, 
illness,  or  injury,"  sores  must  result  from  functional  derangement  and  not  from 
wounds,  and  whether  any  injury  was  of  so  slight  a  character  as  to  he  unworthy  of 
mention  as  beyond  the  reasonable  contemplation  of  the  parties  is  a  question  for 
the  jury.     Home  Mut.  Life  Ass.  v.  Gillespie,  110  Pa.  St.  84.] 

1  "In  the  argument,"  said  the  court,  in  Jones  v.  Provincial  Ins.  Co.,  3  C.  B. 
N.  s.  6,5  "we  were  referred  by  the  defendant's  counsel  to  several  authorities, — 
amongst  others,  Lindeneau  v.  Desborough,  8  B.  &  C.  586,  — establishing  the 
proposition,  which,  as  a  rule,  is  indisputable,  that  it  is  the  duty  of  a  party  effect- 
ing an  insurance  on  life  or  property  to  communicate  to  the  underwriters  or  other 
insurer  all  material  facts  within  his  knowledge  touching  the  subject-matter  of 
insurance,  and  that  it  is  a  question  for  the  jury  whether  any  particular  fact  was 
or  was  not  material  to  be  communicated.  It  is,  however,  equally  clear  that  the 
underwriters  may  in  any  particular  case  limit  their  right  in  this  respect  to  that  of 
being  informed  of  M'hat  is  in  the  knowledge  of  the  assured,  not  only  as  to  its 
existence  in  point  of  fact  but  as  to  its  materiality  ;  and  in  our  opinion  that  is  the 
effect  of  the  limited  declaration  required  in  the  present  case  as  to  disorders  or  cir- 
cumstances tending  to  shorten  life  or  to  render  an  insurance  upon  the  life  insured 
more  than  ordinarily  hazardous." 

2  Life  Association  v.  Foster,  11  Ct.  of  Sess.  Cas.  2d  ser.  351,  an  elaborate  and 
well-considered  case  ;  ante,  §  175. 

3  7  Ct.  of  Sess.  Cas.  2d  ser.  (Scotch)  467 ;  Mallory  v.  Travelers'  Ins.  Co.,  47 
N.  Y.  52  :  2  Ins,  L.  J.  839. 

628 


CH.  XIV.]  HEALTH,    HABITS,   AGE,   ETC.  [§  296 

sured.  "A  disease  requiring '  confinement  "  seems  to  be  one 
calling  for  the  attendance  of  a  physician.  ^  And  it  has  been 
held  as  matter  of  law  that  tubercular  affection  of  the  lungs, 
or  tubercles  upon  the  lungs,  or  tubercles  on  the  brain,  or 
consumption,  either  of  them  constitutes  "local  disease."^ 
But  generally  whether  a  disease  or  injury  is  in  fact  one,  or 
is  serious,  slight,  local,  or  otherwise  qualified,  or  not,  will 
certainly,  if  there  be  any  discrepancy  in  the  testimony  or 
doubt  as  to  its  meaning,  be  a  question  for  the  jury.^  Where 
the  inquiry  is  whether  the  life  insured  has  had  "insanity, 
scrofula,  &c.,"  of  a  hereditary  character,  or  "other  heredi- 
tary disease,"  the  word  "hereditary"  qualifies  the  several 
specified  diseases.*  [In  a  case  where  it  was  provided  that 
any  untrue  or  fraudulent  statements  in  the  application  should 
vitiate  the  policy,  it  appeared  that  in  answer  to  the  question 
whether  certain  of  his  relatives  had  any  hereditary  disease, 
the  applicant,  A.,  said,  "No  hereditary  taint  of  any  kind  in 
family  on  either  side  of  house,  to  my  knowledge."  The 
company  proved  that  an  uncle  of  A.  had  been  insane,  and 
died  in  an  insane  asylum  about  twenty  years  before  the  ap- 
plication. The  jury  were  instructed  to  find  for  the  plaintiff, 
and  the  United  States  Supreme  Court  held  the  instruction 
right.  The  company  was  bound  to  prove  not  only  B,  's  in- 
sanity, but  that  it  was  hereditary,  and  that  both  facts  were 
known  to  A.  when  he  answered  the  question.^  So  when  the 
assured  stated  that  his  relations  had  not  been  afflicted  with 

1  Cazenove  i'.  Brit.  Ei|.  Ass.  Co.,  6  C.  B.  n.  s.  437. 

2  Scoles  V.  Universal  Life  Ins.  Co.,  42  Cal.  523. 

3  Southern  Life  Ins.  Co.  v.  Wili<inson,  L3  Wall.  (U.  S.)  222.  See  also  ante, 
§  187;  Boos  V.  World,  &o.  Ins.  Co.,  64  N.  Y.  236  ;  Moulor  v.  American  Life  Ins. 
Co.,  101  U.  S.  708 ;  Mutual  Life  Ins.  Co.  v.  Snyder,  93  id.  393  ;  Manhattan  Life 
Ins.  Co.  V.  Francisco,  17  Wall.  (U.  S.)  672;  Watson  v.  Main  waring,  4  Taunt. 
763  ;  ante,  §  295  ;  Moore  v.  Connecticut,  &c.  Ins.  Co.,  Sup.  Ct.  (Doni.),  reversing 
s.  c.  3  Ont.  Ct.  of  App.,  Ontario  Dig.  Insurance  addenda,  1880  ;  Newton  v.  Mut- 
ual Ben.  Life  Ins.  Co.,  76  N.  Y.  426 ;  Trefz  v.  Knickerbocker  Life  Ins.  Co.,  C.  Ct. 
(N.  J.),  6  Ins.  L.  J.  850  ;  Conover  v.  Massachusetts  Ins.  Co.,  3  Dill.  C.  Ct.  (Minn.) 
224  ;  post,  §  581. 

4  Newton  v.  Mutual  Benefit  Life  Ins.  Co.,  76  N.  Y.  426;  Peasley  v.  Safety 
Deposit  Company,  I5  Hun  (N.  Y.),  227;  Sinclair  v.  Phoenix  Life  Ins.  Co.,  C. 
Ct.  (Minn.)  9  Ins.  L.  J.  523  ;  North  Western  Life  Ins.  Co.  v.  Gridley,  100  U.  S. 
614  ;  Southern  Life  Ins.  Co.  v.  Wilkinson,  53  Ga.  536. 

5  [Insurance  Co.  v.  Gridley,  100  U.  S.  614,  616,  1879.] 

629 


§  297]  INSURANCE  :    FIRE,    LIFE,    ACCIDENT,    ETC.         [CH.  XIV. 

insanity,  it  was  held  that  proof  of  a  mere  temporary  case  of 
insanity  in  one  of  them  was  not  a  defence,  it  must  appear 
to  have  been  constitutional  and  hereditary  in  its  nature. ^ 
Whether  or  not  sunstroke  and  pneumonia  are  "serious  dis- 
eases "  is  for  the  jury,  when  expert  evidence  conflicts.  ^J 

§  297.  Subject  to  or  afflicted  with  Disease.  —  And  the  same 
rule  is  applicable  to  inquiries  whether  the  applicant  has  been 
afflicted  with  any  particular  disease  or  symptoms  of  disease. 
He  is  bound  to  answer  in  good  faith  and  according  to  his 
knowledge,  —  that  knowledge  which  a  man  of  ordinary  in- 
telligence ought  to  have,  and  in  law  is  presumed  to  have, 
touching  matters  relating  to  his  own  physical  condition  and 
history.  Though  some  of  the  cases  make  use  of  language 
strong  enough  to  require  that  -he  must  answer  truthfully  at 
his  peril,  without  regard  to  the  applicant's  knowledge  of,  or 
reason  to  believe,  the  truth  of  the  fact  as  stated  or  omitted, 
yet,  as  we  have  before  seen,^  the  facts  in  those  cases  did  not 
require  so  extreme  a  ruling;  and  it  may  be  doubted  if,  in 
view  of  the  current  of  opinion,  in  a  case  presenting  the  exact 
point,  the  courts  using  this  language  will  not  be  found  in 
accord  with  the  other  authorities.  Thus,  where  the  state- 
ment in  answer  to  an  inquiry  as  to  a  particular  disease  or 
infirmity,  as  that  the  party  has  not  been  "afflicted  with"  or 
"  subject  to  "  fits,  for  instance,  the  interpretation  to  be  put 
upon  the  clause  is  not  that  the  person  never  had  a  fit  acci- 
dentally, but  that  he  was  not  at  the  time  of  the  insurance  a 
person  habitually  or  constitutionally  afflicted  with  fits,  or  a 
person  liable  to  fits  from  some  peculiarity  of  temperament, 
either  natural  or  contracted,  from  some  cause  or  other.  ^  [A 
false  statement  by  the  insured  that  he  never  had  "vertigo" 
is  not  material,  if  it  was  merely  a  temporary  result  of  in- 

^  [Westover  v.  Mtna.  Life  Ins.  Co.,  2  How.  Pr.  N.  s.  163.] 

-  [Boos  V.  World  Mut.  Life  Ins.  Co.,  6  T.  &  C.  364,  367.] 

3  yhite,  §§  202-205. 

*  Chattock  j;.  Shawe,  1  Mood.  &  Rob.  498  ;  World,  &c.  Ins.  Co.  v.  Schultz,  73 
111.  586  ;  Sinclair  v.  Phoenix,  &c.'Life  Ins.  Co.,  C.  Ct.  (Minn.)  9  Ins.  L.  J.  523  ; 
ante,  §  295.  Otherwise,  if  the  question  be  whether  he  "  erer  had  "  fits.  Fletcher 
V.  ^Etna  Life  Ins.  Co.,  Supreme  Ct.  Montreal,  4  Ins.  L.  J.  236  ;  France  v.  Mtna, 
Life  Ins.  Co.,  C.  Ct.  (Pa.)  2  Ins.  L.  J.  567  ;  94  U.  S.  561. 

630 


CH.  XIV.]  HEALTH,   HABITS,   AGE,   ETC.  [§  298 

digestion.  1]  So,  where  the  question  was  whether  the  appli- 
cant had  ever  been  afflicted  with  the  gout.  "As  to  the  first 
answer,"  said  Cockburn,  C.  J.,  in  his  charge  to  the  jury,  in 
Fowkes  V.  Manchester  and  London  Life  Insurance  Company,^ 
"to  the  question  whether  he  had  ever  been  afflicted  with  the 
gout,  no  doubt  it  must  be  considered  with  some  reasonable 
latitude,  and  the  answer  would  not  be  false  merely  because 
he  had  had  some  symptoms  which  an  experienced  medical 
man  might  S'^e  indicated  the  presence  of  gout  in  the  system. 
You  will  probably  consider  whether  there  was  gout  in  a  sen- 
sible, appreciable  form;  and  in  considering  that  question 
you  will  bear  in  mind  that  the  medical  man  himself  de- 
scribed the  only  attack  which  preceded  the  policy  as  the 
slightest  possible  case  of  gout,  and  that  there  is  no  positive 
evidence  that  the  deceased  knew  that  he  liad  the  gout." 
Where  the  insurance  is  upon  the  life  of  a  third  party,  the 
knowledge  and  good  faith  of  the  third  party  will  be  imput- 
able to  the  insured,  if  he  undertake  for  the  truth  of  the  state- 
ments of  the  "life. "^ 

§  298.  Afflicted  with  Disease.  —  Li  Vose  v.  Eagle  Life  and 
Health  Insurance  Company,^  the  questions  were  whether  the 
applicant  or  any  of  his  family  had  been  afflicted  with  pul- 
monary complaints,  consumption,  or  spitting  of  blood,  or 
whether  he  was  afflicted  with  any  disease  or  disorder,  and 
the  court  thought  he  ought  to  have  stated  the  "  symptoms  of 
consumption  which  he  had,  and  which  he  knew  he  had,  and 
which  he  had  had  for  five  months  previous,"  in  answer  to  • 
the  last  interrogatory.  But  whether  this  were  so  or  not,  the 
denial  that  he  had  been  afflicted  with  pulmonary  complaints, 
consumption,  or  spitting  of  blood,  under  such  circumstances, 
whether  regarded  as  a  warranty  or  representation,  avoided 

1  [Mutual  Benefit  Life  Ins.  Co.  v.  Daviess'  Ex'x,  87  Ky.  541.] 

2  3  F.  &  F.  440. 

3  Duckett  V.  Williams,  2  Carr.  &  Marsh.  848  ;  Mutual  Benefit  Life  Ins.  Co.  v. 
Cannon,  48  Ind.  264  ;  Forbes  v.  Ed.  Life  Ass.  Co.,  10  Ct.  of  Sess.  Cas.  (Scotch) 
451.  In  Duckett  v.  Williams  it  was  held  that  a  warranty  by  the  assured,  that 
the  life  is  a  good  one,  cannot  be  avoided  by  a  want  of  knowledge  and  proof  of 
good  faith.  But  see  Life  Ass.  v.  Foster,  11  Ct.  of  Sess.  Cas.  2d  ser.  351 ;  ante, 
§§  202-204  ;  Arclnbald  v.  Mut.  Life  Ins.  Co.,  38  Wis.  542. 

*  6  Cush.  (Mass.)  42. 

631 


§  298]  INSURANCE  :   FIRE,   LIFE,   ACCIDENT,   ETC.         [CH.  XIV. 

the  policy.  In  a  later  case,  in  the  same  State,  where  the 
question  was  whether  the  insured  had  been  "  subject  to  or  at 
all  affected  by  spitting  of  blood, "  ^  the  appellate  cour  held 
the  following  language :  — 

"  The  court  instructed  the  jur}'  that  the  repeated  spitting 
of  blood,  accompanied  by  a  cough,  was  so  far  an  indication 
of  disease,  that  if  the  applicant  had  suffered  from  it  he  was 
bound  to  have  so  stated ;  that  if  he  was  subject  to  occasional 
spitting  of  blood,  a,ccompanied  by  a  cough,  he  was  bound  to 
have  stated  that  fact,  and  that  the  same  was  true  if  he  had 
spit  blood  in  a  single  instance,  if  recent,  and  such  as  to  ex- 
cite apprehension  in  his  own  mind  that  it  was  the  result  of 
disease. 

"  Considering  the  various  foj-ms  and  degrees  in  which  the 
spitting  of  blood  with  a  cough  may  manifest  itself,  the  un- 
certainty as  to  its  source  and  cause,  and  the  character  of  the 
facts  which  the  testimony  in  this  case  tended  to  prove,  we 
cannot  say  that  the  rulings  of  the  court  ought  to  have  gone 
further  than  this  in  favor  of  the  propositions  of  the  defend- 
ant. The  mere  raising  of  a  small  quantity  of  blood  with  a 
cough  in  a  single  instance  is  not  necessarily  an  indication  of 
disease  or  a  material  circumstance,  so  that  such  an  occur- 
rence, however  slight,  at  any  time  during  the  previous  life 
of  the  applicant,  would  make  his  answer  such  a  misrepre- 
sentation as  to  require  that  the  court  should  so  declare  it  as 
a  matter  of  law. " 

And  in  the  same  case,  on  exceptions  after  another  trial, 
the  question  being  whether  the  insured  had  truly  answered 
the  same  question  relative  to  "bronchitis,"  the  court  say: 
"It  was  for  the  jury  to  decide  whether  '  chronic  bronchitis' 
or  '  bronchial  difficulty,'  or  any  other  bodily  affection  or  con- 
dition to  which  the  assured  was  found  by  them  to  have  been 
subject,  amounted  to  bronchitis,  consumption,  disease  of  the 
lungs,  or  some  other  of  the  infirmities  stated  in  the  applica- 
tion, and  relied  on  by  the  defendants ;  and  whether  the  spit- 
ting of  blood  by  him,  if  proved  to  have  taken  place,   was 

1  Campbell  v.  New  England  Mut.  Life  Ins.  Co.,  98  Mass.  381.  See  also  Har- 
tigan  V.  International  Life  Ass.  Co.,  8  L.  C.  Jour.  203. 

632 


CH.  XIV.J  HEALTH,   HABITS,   AGE,   ETC.  [§  298 

under  such  circumstances  as  to  indicate  disease  in  his  throat, 
lungs,  air  passages,  or  other  internal  organs."  So  where 
the  application  states  that  the  insured  had  not  had  "any 
spitting  of  blood,  consumptive  symptoms,"  &c.,  the  "spit- 
ting of  blood  "  must  be  taken  to  mean  a  symptom  of  disease 
tending  to  shorten  life,  the  mere  fact  being  of  no  signifi- 
cance, as  it  may  happen  from  the  mere  pulling  a  tooth.  Yet 
the  court  were  of  the  opinion  that  if  a  single  instance  of 
spitting  of  blood  was  the  "  result  of  the  disease  called  spit- 
ting of  blood,"  it  ought  to  be  stated. ^  If  he  had  "spit  blood 
from  his  lungs,  no  matter  in  how  small  quantity,  or  even 
had  spit  blood  from  an  ulcerated  sore  throat,  he  would  be 
bound  to  state  it;"  and  one  of  the  learned  judges,  Pollock, 
C.  B.,  went  so  far  as  to  say  that  "one  single  act  of  spitting 
of  blood  "  ought  to  have  been  mentioned,  though  he  had  just 
before  said  that  the  expression  "spitting  of  blood  "  no  doubt 
meant  the  disorder  so  called,  whether  proceeding  from  the 
lungs,  the  stomach,  or  any  other  part  of  the  body,  leaving 
it  fairly  to  be  inferred  that  he  intended  to  go  no  further 
than  his  brethren  in  respect  to  the  single  act.^  In  Fried  v. 
Royal  Insurance  Company,  the  question  tried  was  whether 
the  "  spitting  of  blood  "  proceeded  from  the  lungs  or  from  the 
stomach,  under  a  representation  by  the  insured  that  he  was 
not  afflicted  with  spitting  of  blood  or  disease  of  the  lungs. ^ 
The  propriety  of  submitting  the  question  in  this  form  to  the 
jury  seems  not  to  have  been  contested  in  either  of  the  appel- 
late courts,  the  Supreme  Court, ^  or  the  Court  of  Appeals.^ 
[In  answer  to  the  questions,  "  Has  the  party  had  any  of  the 


1  [But  in  Michigan  it  was  more  sensibly  lield  that  a  mere  temporary  ailment, 
as  slight  lung  trouble,  and  spitting  of  blood,  that  does  not  nnderniine  the  consti- 
tution, will  not  aflfect  a  policy  issued  on  an  application  that  declares  that  the 
plaintiff  had  never  been  afflicted  with  the  disease  of  asthma  or  blood  spitting. 
Pudritzky  v.  Knights  of  Honor,  76  Mich.  428.] 

2  Geach  v.  Ingall,  14  Mees.  &  Wels.  95.  The  court  will,  in  its  discretion,  order 
the  defendant  to  file  a  bill  of  particulars,  setting  forth  when  and  where  the  facts 
alleged  in  defence  occurred.  Dwight  v.  Germauia  Life  Ins.  Co.  (N.  Y.},  10  Ins. 
L.  J.  295. 

3  So  stated  in  Bliss  on  Insurance,  p.  159. 
*  47  Barb.  (N.  Y.)  127. 

6  2  Ins.  L.  J.  126. 

633 


§298] 


insurance:    fire,   life,   accident,    etc.        [CH.  XIV. 


following  complaints  .  .  .  (16)  pneumonia,  .  .  .  spitting  or 
raising  of  blood,  (20)  any  disease  of  the  lungs  ?  "  the  assured 
said  "No,"  and  it  was  held  that  there  was  no  warranty  that 
the  assured  never  had  spitting  or  raising  of  blood,  but  only 
that  he  never  had  it  in  such  form  as  to  constitute  a  dis- 
ease.^ (a)]  ■  Fainting  fits  are  not  "epileptic  or  other  fits,"  and 

1  [Dreier  v.  Continental  Life  Ins.  Co.,  24  Fed.  Rep.  670  (Ind.)  1885.] 


(a)  The  applicant's  answers  as  to 
his  previous  health  are  warranties  and 
material  to  the  risk.  Hambrongh  v.  Mut- 
ual L.  Ins.  Co.,  72  L.  T.  140  ;  Maier  v. 
Fidelity  M.  L.  Ass'n,  78  Fed.  Rep.  566  ; 
Nelson  t;.  Nederland  L.  Ins.  Co.  (Iowa), 
81  N.  W.  807  ;  Petitpain  v.  Mut.  Reserve 
Fund  L.  Ass'n  (La.),  27  So.  113  ;  Aloe 
V.  Mutual  Reserve  Fund  L.  As'n,  147  Mo. 
561  ;  Reilly  v.  Chicago  Guaranty  Fund 
L.  Society,  75  Minn.  377  ;  Boland  v.  In- 
dustrial B.  Ass'n,  74  Hun,  385  ;  Red- 
mond V.  Industrial  B.  Ass'n,  78  Hun, 
104;  Sternman  v.  Met'n  L.  ln.s.  Co.,  63 
N.  Y.  S.  674  ;  Jerrett  v.  John  Hancock 
M,  L.  Ins.  Co.,  18R.  I.  754.  But  his  war- 
ranty i.s,  not  that  the  statements  in  his 
application  are  absolutely  correct,  but 
that  he  has  not  consciously  or  wilfully 
falsified.  Keatley  v.  Travellers'  Ins.  Co., 
187  Penn.  St.  197-  Some  diseases  or  bod- 
ily conditions  are  of  such  a  nature  that 
the  question  whether  they  increase  the 
risk  of  loss  is  for  the  jury.  See  Freeman 
V.  Mercantile  Mut.  Ace.  Ass'n,  156  Mass. 
351  ;  Dorey  v.  Met'n  L.  Ins.  Co.,  172 
Mass.  234  ;  Life  Ins.  Clearing  Co.  v. 
Altshuler,  55  Neb.  341.  Rupture  is  said 
to  be  of  that  class.  Levie  v.  Met'n  Ins. 
Co.,  163  Mass.  117  ;  see  Travelers'  Ins. 
Co.  V.  Murray,  16  Col.  296.  So  of  tem- 
porary heart  prostrations,  especially 
when  the  evidence  is  conflicting.  Smith 
V.  Met'n  L.  Ins.  Co.,  183  Penn.  St.  504  ; 
Commercial  Travellers'  Mut.  Ace.  Ass'n 
V.  Fulton,  79  Fed.  Rep.  423.  So  of 
"head-aches"  :  see  Mutual  L.  Ins.  Co. 
V.  Simpson,  88  Texas,  333  ;  Petitpain  v. 
Mut.  Reserve  Fund  L.  Ass'n  (La.),  27 
So.  113;  of  "fainting  spells":  see 
Manufacturers'  Ace.  Ind.  Co.  v.  Dorgan, 
58  Fed.  Pep.  945,  and  of  "bronchial 

634 


affections,"  or  the  "  spitting  of  blood  "  : 
see  Mutual  Beneiit  L.  Ins.  Co.  v.  Robi- 
son,  58  Fed.  Rep.  723  ;  White  v.  Pro- 
vident S.  L.  Ass.  Society,  163  Mass. 
108  ;  March  v.  Met'n  L.  Ins.  Co.,  186 
Penn.  St.  629  ;  Smith  v.  Northwestern 
Mut.  L.  Ins.  Co.  (Penn.),  46  Atl.  426. 
On  the  other  hand,  there  are  conditions 
and  diseases  of  a  nature  which  requires 
it  to  be  held,  as  matter  of  law,  that  a 
misrepresentation  as  to  them  is  one  as 
to  a  matter  which  increases  the  risk  of 
loss.  That  the  applicant  was  addicted 
to  the  excessive  use  of  intoxicating 
liquors  was  held  to  be  such  matter  in 
Rainger  v.  Boston  M.  L.  Ass'n,  167 
Mass.  109.  Consumption  develojied  in 
the  applicant  or  his  ancestors  is  also  of 
the  latter  class.  Brown  v.  Greenfield  L. 
Ass'n,  172  Mass.  498  ;  March  v.  Met'n 
L.  Ins.  Co.,  186  Penn.  St.  629  ;  Jerrett 
V.  John  Hancock  M.  L.  ln.s.  Co.,  18  R.  I. 
754  ;  Knights  of  Pythias  v.  Eosenfeld, 
92  Tenn.  508;  Met'n  L.  Ins.  Co.  v. 
Dempsey,  72  Md.  288. 

Under  the  statute  of  Iowa  providing 
that  when  the  applicant  is  declared  by 
the  com{iany's  medical  examiner  to  be  a 
fit  subject  of  insurance,  the  company 
shall  be  estopped  to  deny  that  he  was  in 
the  required  condition  of  health,  unless 
the  policy  was  procured  by  fraud  or  de- 
ceit, false  answers  as  to  health  by  the  in- 
sured cannot  be  set  up  in  the  absence  of 
evidence  that  the  physician  was  deceived 
or  was  in  collusion  with  insured.  Wei- 
mer  v.  Economic  Life  Ass'n  (Iowa),  79 
N.  W.  123.  The  parties  cannot  contract 
as  to  the  statements  which  shall  be  ma- 
terial when  a  statute  provides  that  they 
must  be  material  in  order  to  aff'ect  the 
risk,  but  the  materiality  of  the  state- 


CH.  XIV.]  HEALTH,    HABITS,   AGE,   ETC.  [§  299 

are  consistent  witli  the  truth  of  a  representation  that  the 
applicant  is  not  subject  to ''epileptic  or  other  fits. "^  And 
where  one  is  asked  whether  he  has  had  disease  of  the  liver 
or  throat,  this  means  something  more  than  a  temporary  ail- 
ment which  indicates  no  constitutional  vice,  and  leaves  no 
permanent  consequences.^  [The  length  of  time  before  the 
application  that  an  attack  of  apoplexy  occurred  may  be  ma- 
terial, in  viev/  of  the  fact  that  the  longer  the  person  lives 
without  a  new  attack  the  less  likelihood  there  is  of  further 
trouble.  2] 

§  299.  Habits  ;  Intemperance  ;  Opium-eating.  —  A  warranty 
that  the  insured  is  of  sober  and  temperate  habits  means  that 
at  the  time  of  insurance,  and  for  such  a  reasonable  time 
prior  thereto  as  would  allow  of  a  man  evincing  a  habit,  the 
insured  was  a  temperate  man.  The  question  is  not  whether 
he  was  intemperate  to  such  a  degree  as  to  injure  his  health. 
The  insurers  have  a  right  to  protect  themselves  by  guarding 
against  the  risks  of  pernicious  habits;  and  if  one  who  stipu- 
lates for  habitual  sobriety  and  temperance  is  an  habitual 
drunkard,  he  loses  his  protection  under  such  a  warranty, 
though  his  health  may  be  good  and  his  constitution  unim- 
paired.* [The  questions  "Has  the  party  ever  been  intem- 
perate ?  "  "Is  he  now  of  temperate  habits  ?  "  refers  to  habits 
and  not  to  occasional  practices.^  If  the  ordinary  habits  of 
a  person  are  temperate,  his  representation  that  he  was  a 
man  of  temperate  habits  is  not  untrue,  though  from  excep- 

1  Shilling  V.  Accidental  Death  Ins.  Co.,  1  F.  &  F.  116. 

2  Cushnian  v.  United  States  Ins.  Co.,  70  N.  Y.  72  ;  Eisner  v.  Guardian  Life 
Ins.  Co.,  C.  Ct.  (Mo.)  5  Ins.  L.  J.  613. 

3  [Webster  v.  Mutual  Relief  Soc,  20  U.  S.  R.  347.] 
*  Southcombe  v.  Merriman,  Carr.  &  Marsh.  286. 

5  [Union  Mut.  Life  Ins.  Co.  v.  Reif,  36  Ohio  St.  596.] 

nients   must   be  determined  judicially,  application,  the  by-laws,  and  the  policy 

Even  when  statements  as  to  diseases  in  of  an  assessment  association  made  the 

the  application  are  material,  the  insured  application  a  warranty,  an  untrue  an- 

is   not  obligated   to   remember  all   his  swer  as   to   health   avoids  the   policy, 

temporary  ailments  and  functional  dis-  though  not  material  to  the  risk.     Aloe 

eases  which  did  not  permanently  impair  v.   Mut.   Reserve  Fund  L.   Ass'n,    147 

his  health.     Fidelity  Mut.    L.  Ass.  v.  Mo.  561. 
Miller,   92   Fed.   Rep.    63.     When   the 

635 


§  299]  INSURANCE  :   FIRE,   LIFE,    ACCIDENT,    ETC.  [CH.  XIV. 

tioual  overindulgence  he  may  have  had  the  delirium  tremens^ 
I  doubt  if  these  rulings  are  fair.     A  man  who  drinks  in  such 
a  way  that  he  has  had  the  delirium  tremens,  whether  as  the 
result  of  a  single  debauch  or  otherwise,  is  liable  to  have  an- 
other debauch  and  another  attack.     He  is  not  a  temperate 
man  in  the  true  sense  and  spirit  of  the  question,  who  is  open 
to  such  excess,  nor  does  his  answer  disclose  what  the  com- 
pany manifestly  desires  to  know,  viz.  the  danger  to  his  life 
by  reason  of  his  appetite  for  drink.     Literally  it  is  true  that 
one  is  not  less  of  intemperate  habit  because  he  is  sober  now 
and  then,  and  so  the  general  habit  of  a  man  may  be  tem- 
perate and  yet  he  may  at  times  be  drunk;  but  the  spirit 
should  govern  the  letter,  and  the  insured  should  be  held  to 
state  facts  so  manifestly  germane  to  the  motive  of  the  ques- 
tion, if  they  are  near  enough  in  time  to  be  material  and  in 
his  memory.     Technicalities  and  literalitics  should  not  pro- 
tect the  insured  any  more  than  the  company.     Except  in 
very  clear  cases,  the  question  if  habitual  intemperance  ex- 
isted is  for  the  jury.^     And  it  is  error  to  charge  that  a  con- 
tinuous and  daily  use  of  liquor  is  necessary  to  constitute  a 
habit.  3     Where  it  was  agreed  that  if  the  habits  of  the  in- 
sured should  change  so  as  to  increase  the  risk,  the  policy 
should  be  void,  and  he  became  intemperate  during  the  year 
before  his  death,   but  medical   opinion  was  divided  on  the 
question  of  the  materiality  of  the  change,  it  was  held,  that 
the  change  in  its  nature   increased  the  risk.*]      Especially 
have  the  insurers  a  right  to  know  that  the  insured  had  had 
delirium  tremens  within   one  year  prior  to  the   issuing  the 
policy,  and  that  during  the  year  prior  to  that  he  had  been 
attended  by  his  physician  on  account  of  the  effects  of  ex- 
cessive drinking.^     In  Scotland  it  is  held  that  the  habit  of 
using  opium,  laudanum,  or  spirituous  liquor  to  such  an  ex- 
tent as  to  impair  the  health  is  one  that  ought  to  be  disclosed. 

1  [Insurance  Co.  v.  Foley,  105  U.  S.  350,  354.] 

2  [Northwestern  Ins.  Co.  v.  Muskegon  Bank,  122  U.  S.  501.] 

3  [Union  Mat.  Life  Ins.  Co.  v.  Reif,  36  Ohio  St.  596.] 

4  [Boyce  i;.  Phcenix  Mut.  Ins.  Co.,  14  Can.  S.  C.  R.  723  (three  judges  dis- 
senting. ] 

5  Hutton  V.  Waterloo  Life  Ass.  Soc,  1  F.  &  F.  735. 

636 


CH.  XIV.]  HEALTH,    HABITS,   AGE,    ETC.  [§  299 

And  a  policy  was  held  void  for  non-communication  of  this 
fact,  the  applicant  having  stated  that  he  was  in  perfect 
health,  and  a  negative  answer  by  both  the  medical  and  other 
referees  to  the  question  whether  "they  knew  any  reason  why 
an  insurance  on  the  life  would  be  more  than  usually  hazard- 
ous "  having  been  given. ^  If  the  agreement  is  that  at  the 
time  of  the  insurance  the  insured  is  a  man  of  sober  and 
temperate  habits,  and  that  is  not  the  fact,  it  is  no  answer 
to  say  that  the  habits  were  not  such  as  to  injure  the  health.  ^ 
Addicted  to  the  excessive  use  of  intoxicating  liquor  means 
habitual  excessive  use,  not  occasional.  There  is  no  sharp 
division  between  ebriety  and  inebriety,  what  is  habitual  and 
what  occasional,  what  is  temperate  and  what  is  intemperate. 
The  words,  however,  are  not  technical,  and  it  is  for  the  jury 
to  say  whether  the  circumstances  bring  the  insured  within 
either  category.3(a)     Habits  of  intemperance  acquired  sub- 

1  Forbes  v.  Ed.  Life  Ass.  Co.,  10  Ct.  of  Sess.  Cas.  (Scotch)  1st  ser.  451. 

2  Southcombe  v.  Merriman  et  al.,  Carr.  &  Marsh.  286  ;  SIcGinley  v.  United 
States  Life  Iiis.  Co.,  77  N.  Y.  495 ;  affirming  s.  c.  in  the  C.  C.  P.,  7  Ins.  L.  J.  791 ; 
Fox  V.  Pennsylvania,  &c.  Ins.  Co.,  Dist.  Ct.  Phila.,  4  Big.  Life  &  Ace.  Ins.  Cas. 
458  ;  Furniss^v.  Mut.  Ins.  Co.,  Supr.  Ct.  (N.  Y.)  11  Reptr.  98. 

3  Mowry  v.  Home  Ins.  Co.,  1  Big.  Life  &  Ace.  Ins.  Cas.  698  ;  9  E.  I.  346  ; 
Swick  V.  Home  Life  Ins.  Co.,  2  Dill.  C.  Ct.  1 60  ;  John  Hancock,  &c.  Ins.  Co.  v. 
Daly,  65  Ind.  6;  Holterhoff  v.  Mntual  Benefit  Life  Ins.  Co.,  3  Am.  Law  Record, 
272  ;  s.  c.  4  Big.  Life  &  Ace.  Ins.  Cas.  395.  In  this  case  the  court  distinguished 
between  periodical  "sprees"  and  habitual  intemperance,  unless  the  "sprees" 
were  frequent  and  aroused  an  uncontrollable  appetite  while  they  continued,  in 
which  case  the  habit  of  intemperance  might  be  said  to  exist ;  and  Tilden, ,].,  thus 
defined  "habit  :"  "A  habit  ...  is  a  disposition  or  condition  of  the  mind  or 
tody,  —  a  tendency  or  aptitude  for  the  performance  of  certain  actions  acquired 
by  custom  or  frequent  repetition  of  the  same  acts.  Habit  is  that  which  is  held 
or  retained,  — the  effect  of  custom  or  frequent  repetition.  Hence  we  speak  of 
good  habits  or  bad  habits."  See  also  Union  Ins.  Co.  v.  Reif  (Ohio),  10  Ins.  L.  J. 
428. 

(a)  See  Hanna  v.  Conn.  Mut.  L.  Ins.  of  using  intoxicating  liquors  to  excess 

Co.,  150  N.  Y.  526  ;  Janneck  v.  Met'n  increases  the  risk  of  loss  in  life  insur- 

L.   Ins.   Co.,   162  N.  Y.   574  ;  Masons'  ance,  and  a  misrepresentation  as  to  such 

Union  L.  Ins.   Ass'n  v.  Brockman,  20  habit  by  the  assured  in  his  ajiplication 

Ind.    App.    206  ;    Waters   v.    Supreme  for  insurance  avoids  the  policy,  under 

Conclave   Knights  of  Damon,   105  Ga.  Mass.  St.  1895,  c.  271,  whether  he  did 

151  ;  Ins.  Co.   v.   Lauderdale,  94  Tenn.  or  did  not  actually  or  knowingly  intend 

635;  Mutual  L.  Ins.  Co.  v.  Thomson,  to. deceive   the  insurer  by  such  state- 

94  Ky.  253  ;  Union  Central  L.  Ins.  Co.  ment.    Raingerr.  Boston  Mut.  L.  Ass'n, 

V.  Lee  (Kv.),  47  S.  W.  614.     The  habit  167  Mass.  109.     There  must  be  a  habit 

637 


§  299]  INSUKANCE  :    FIKE,   LIFE,    ACCIDENT,    ETC.         [clI.  XIV. 

sequent  to  the  insurance,  even  though  the  cause  of  death, 
will  not  avoid  the  policy,  unless  expressly  so  stipulated. ^ 
And  a  declaration  by  the  assured  that  he  "  does  not  now,  nor 
will  he,  practise  any  pernicious  habit  that  obviously  tends  to 
the  shortening  of  life,"  as  to  the  latter  clause  is  a  mere  dec- 
laration, and  not  a  covenant  the  violation  of  which  will  work 
a  forfeiture  of  the  policy. ^  And  that  the  insured  died  from 
an  injury  received  while  intoxicated  is  immaterial,^  unless 
the  policy  provides  to  the  contrary.*  But  a  man  cannot 
truly  be  said  always  to  have  been  sober  and  temperate,  who, 
though  usually  of  sober  and  temperate  habits,  occasionally 
indulges  in  drunken  debauches,  which  sometimes  terminate 
in  delirium  tremens.^ {a)  And  that  one's  habits  were  intem- 
perate recently  prior  to  the  application  is  evidence  of  his 
habits  at  that  time.^     And  where  such  habits,   "seriously 

1  Reichard  v.  Manhattan  Life  Ins.  Co.,  31  Mo.  518;  Horton  v.  Equitable  Life 
Ass.  See.  of  the  United  States,  0.  C.  P.  (N.  Y.)  1870  ;  s.  c.  2  Big.  Life  &  Ace. 
Ins.  Cas.  108. 

2  Knecht  v.  Mutual  Life  Ins.  Co.  (Pa.),  90  Pa.  St.  118.  But  see  contra.  Hoi- 
terhoff  V.  Mutual  Life  Ins.  Co.,  infra. 

3  Ibid. 

4  Shader  v.  Kailway,  &c.  Ins.  Co.,  5  T.  &  C.  (N.  Y.)  643. 

5  Mutual  Benefit  Life  Ins.  Co.  v.  Holterhoff,  2  Cincinnati  Sup.  Ct.  Kep.  379. 
But  see  John  Hancock,  &c.  Ins.  Co.  v.  Daly,  supra. 

6  Daly  V.  John  Hancock  Ins.  Co.,  Sup.  Ct.  (Ind.),  8  Ins.  L.  J.  319. 

of  using  alcoholic  stimulants,  and  not  a  that  the  applicant  had  taken  the  "  Kee- 

single  or  occasional  use,  to  establish  the  ley  cure  "  waives  conditions  in  the  pol- 

falsity  of  an  applicant's  answer  that  he  icy  as  to  intemperance,  so  far  as  such 

uses  no  such  stimulants.     Grand  Lodge  cure  applies  thereto.     DeWitt  v.  Home 

V.  Belcham,   145  111.  308;  Meaeham  v.  Forum  Benefit  Order,  95  Wis.  305. 

New  York  State  Mut.   Ben.  Ass'n,  120  (a)  See  Provident  Savings  L.  Ass. 

N.  Y.  237.     The  word  "  temperate,"  in  Society  v.  Llewellyn,  58  Fed.  Rep.  940  ; 

a  policy  or  application,  refers  to  absii-  Malicki  v.  Chicago  Guaranty  Fund  L. 

nence  from  excessive  or  injurious  use.  Society  (Mich.),  77  N.  W.  690.     When 

not  to  total  abstinence.     Ibid.  ;  Cham-  this  ground  is  relied  upon,  the  impair- 

bers  V.  Northwestern  M.  L.  Ins.  Co.,  64  ment  of  health  caused  by  the  use  of  in- 

Minn.  495.     Impairment  of  health   or  toxicating  liquors  must  be  serious  and 

death  resulting  from   alcoholic   stimu-  permanent.     Miwa.  L.  Ins.  Co.  v.  Dem- 

lants,  when  taken  in  good  faith  under  ing,  123  Ind.  384.    The  insurer  has  the 

competent  medical  advice,  was  held  not  burden  to  show  that  death  resulted  from 

to  violate  a  stipulation  in  a  life  policy  this  cause.     Malicki   v.  Chicago  Gunr- 

against  their  use  in  ^tna  L.  Ins.  Co.  anty  Fund  L.  Society,  swpra:  ^tna  L. 

V.   Ward,   140  U.  S.  76  ;  123  id.  743.  Ins.  Co.  v.  Hanna,  81  Texas,  487. 
Knowledge  of    the  insurer's   secretary 

638 


CH.  XIV.]  HEALTH,    HABITS,   AGE,   ETC.  [§  300 

impairing  the  health,  or  inducing  delirium  tremens^''^  acquired 
after  insurance,  are  made  a  ground  of  forfeiture,  evidence 
that  he  was  a  drunkard  before,  and  that  the  amount  which 
he  drank  both  before  and  after  was  sufficient  to  impair  his 
health,  not  amounting  to  evidence  that  his  health  was  im- 
paired or  delirium  induced  by  the  subsequent  intemperance, 
is  inadmissible.^ 

§  300.  Same  Subject ;  Distinction  between  Answer  to  Spe- 
cific Question  and  a  Want  of  Fulness  in  answer  to  a  General 
Question.  —  The  same  general  questions  as  to  health  and 
habits  came  before  the  court  in  a  case  where  certain  of  the 
questions  were  somewhat  different  in  form  from  any  of  those 
we  have  been  considering,  —  one,  especially,  calling  for  an 
answer  whether  the  habits  of  the  insured  were  uniformly  and 
strictly  sober  and  temperate,  and  it  was  held  that  the  occa- 
sional use  of  intoxicating  liquors  by  the  insured  did  not 
make  his  answers  untrue. ^ 

1  Odd  Fellows  Mut.  Life  Ins.  Co.  v.  Rohkopp  (Pa.),  9  Ins.  L.  J.  787. 

2  Swick  V.  Home  Life  Ins.  Co.,  2  Dill.  C.  Ct.  (Mo.)  160.  The  case  was  tried 
before  Dillon  and  Treat,  JJ.,  and  seems  to  have  been  carefullj'^  considered.  In 
charging  the  jury  the  court  used  the  following  language:  "The  main  defence 
upon  the  trial  has  been  rested  upon  alleged  misrepresentations  by  the  assured  in 
the  application,  respecting  his  health  and  his  habits  as  to  the  use  of  alcoholic 
drinks.  In  the  application  the  following  questions  were  asked  of  Henry,  and 
answered  by  him:  6.  '  Is  your  health  good  (and,  as  far  as  you  know)  free  from 
any  symptoms  of  disease  ? '  Answer  :  '  Yes.'  9.  '  Are  your  habits  uniformly 
and  strictly  sober  and  temperate?'  Answer:  'Yes.'  10  («).  'Have  you  ever 
been  addicted  to  the  excessive  or  intemperate  use  of  any  alcoholic  stimulant  or 
opium?'  Answer:  'No.'  10(5).  'Do  you  use  habitually  intoxicating  drinks 
as  a  beverage  ? '  Answer:  'No.'  By  the  terms  of  the  contract  between  these 
parties,  these  answers  are  warranted  to  be  true  ;  and  it  is  agreed  in  the  policy 
that  if  these  answers  are  untrue  or  deceptive  in  any  respect,  the  policy  shall  be 
void  and  of  no  effect.  The  parties  have  the  right  thus  to  agree,  and  are  bound  by 
their  agreement,  and  hence  the  importance  of  understanding  what  the  questions 
asked  were,  and  the  answers  given  thereto.  This  is  the  more  important,  because, 
if  the  answers  given  are  untrue,  the  policy  is  avoided,  although  there  are  no  in- 
tentional or  fraudulent  misstatements,  and  although  the  party's  habits  as  to  intox- 
icating drinks  did  not  in  fact  cause  or  even  accelerate  his  death.  We  remark  to 
you,  first,  that  the  questions  as  to  health  and  habits  in  respect  to  intoxicating 
drinks  will  be  taken  to  mean  what  the  words  employed  by  those  questions  usu- 
ally and  commonly  mean.  They  are  not  words  of  art,  but  words  of  every-day 
meaning  ;  and  this  is  a  contract  not  between  professional  men  or  lawyers,  but  a 
contract  that  these  companies  profess  to  make  with  the  world,  and  when  they  ask 
a  man  if  his  health  is  good,  there  is  no  mystery  in  the  question.  If  you  find  !Vom 
the  evidence  that  at  the  date  of  the  application  Henry's  health  was  not  good,  or 

639 


§  301]  INSURANCE  :     FIRE,    LIFE,    ACCIDENT,    ETC.  [CH.  XIV. 

§  301.     Death    by  Intemperance  ;    Proximate    Cause    —  If    a 
policy  is  by  its  provisions  to  be  void  when  the  insured  shall 

if  Henry  knew  of  any  symptom  of  disease  which  he  did  not  disclose,  then  there 
can  be  no  recovery  on  the  policy.  IF  you  find  the  fact  to  be,  as  the  company'' 
contends  it  was,  that  Henry's  general  health  was  at  the  time  impaired  by  ex- 
posure, or  from  the  use  of  intoxicating  liquors,  or  from  any  other  cause,  there 
can  be  no  recovery  on  the  policy.  But  if  it  was  shown  to  the  company,  or  its 
agent  taking  the  risk,  that  the  assured  had,  as  certified  by  the  family  physician 
to  the  company,  been  sick  a  few  days  before,  and  if  this  was  a  mere  tempoi-ary 
illness  which  was  over  at  the  time,  and  was  disregarded  by  the  company,  or  its 
agent  taking  the  risk,  as  not  being  within  the  purview  of  the  question  asked  of  the 
assured  in  this  respect,  the  policy  would  not  be  thereby  avoided.  Now  as  to  the 
question  respecting  intoxicating  liquors.  These  relate  to  the  habits  of  the  party. 
The  applicant  stated  that  he  had  never  been  addicted  to  the  excessive  or  intem- 
perate use  of  alcoholic  stimulants.  ,  This  is  not  a  statement  that  he  had  never 
been  addicted  to  the  use  of  intoxicating  liquors  at  all,  but  a  statement  that  he 
had  never  been  addicted  to  the  excessive  and  intemperate  use  of  them  ;  and  it  is 
untrue  if  Henry  had,  and  only  in  case  he  had,  been  addicted  to  the  excessive  or 
intemperate  use  of  alcoholic  stimulants.  The  application,  in  answer  to  other 
questions,  stated  that  his  habits  were  uniformly  and  strictly  sober  and  temperate, 
and  that  he  did  not  habitually  use  intoxicating  drinks  as  a  beverage.  These 
questions  and  answers,  you  will  perceive,  relate  to  the  habits  of  the  party  in  that 
respect.  If  the  company  did  not  intend  to  insure  any  person  who  used  intoxi- 
cating liquors  at  all,  it  would  be  very  easy  to  ask  such  a  question.  But  they 
have  not  done  so.  The  occasional  use  of  intoxicating  liquors  by  the  applicant 
would  not  make  these  answers  untrue  ;  nor  would  they  be  rendered  untrue  by  any 
use  of  intoxicating  drinks  which  did  not  make  his  habits  those  of  a  man  not  uni- 
formly and  strictly  sober  and  temperate,  or  which  did  not  amount  to  habitual  use 
of  such  drinks  as  a  beverage.  It  is  your  province  to  decide  from  the  evidence 
whether  the  assured  was  or  was  not,  at  the  time  the  application  was  made,  a  man 
whose  habits  were  uniformly  and  strictly  sober  and  temperate,  or  whether  he  did 
or  did  not  habitually  use  intoxicating  stimulants  as  a  beverage  ;  and  if  you  find 
his  answer  to  either  question  to  be  untrue,  there  can  be  no  recovery  on  this  policy, 
although,  as  above  remarked,  he  did  not  intentionally  make  false  answers,  and 
although  those  habits  did  not  in  fact  cause,  hasten,  or  contribute  to  the  death. 
We  have  been  asked  by  the  defendant  to  instruct  you  that  if  the  answers  as  to 
the  health  and  habits  are  not  full,  correct,  and  true,  the  plaintiff"  cannot  recover, 
even  though  the  failure  to  make  full  answers  was  unintentional.  The  application 
referred  to  and  made  part  of  the  policy  contains  the  provision  :  '  The  undersigned 
does  hereby  covenant  .  .  .  that  the  preceding  answers  and  this  declaration  shall 
be  the  basis  of  the  policy  ;  that  the  same  are  ivarra.nted  to  be  full,  correct,  and 
true,  and  that  no  circumstance  is  concealed,  withheld,  or  unmentioned  in  relation 
to  the  past  or  present  state  of  health,  habits  of  life,  or  condition  of  the  said  party 
whose  life  is  to  be  assured,  which  may  render  an  insurance  on  his  life  more  than 
usually  hazardous,  or  which  may  aff'ect  unfavorably  his  prospects  of  life ; '  and 
that  'if  the  foregoing  answers  and  statements  be  not  in  all  respects  full,  true,  and 
correct,  the  policy  shall  be  void.'  The  policy  repeats  or  adopts  this  provision. 
Now  a  distinction  is  to  be  taken,  we  think,  between  untruthful  answers  to  spe- 
cific questions  and  the  mere  failure  to  make  full  answers.  Such  failure,  under 
these  provisions,  to  defeat  the  policy  must  relate  to  some  circumstance  which 
might  render  an  insurance  on  his  life  more  than  usually  hazardous,  or  which 

640 


CH.  XIV.]  HEALTH,    HABITS,    AGE,    ETC.  [§  301 

die  by  reason  of   intemperance   in  the  use  of  intoxicating 
liquor,  it  must  appear  that  intemperance  is  the  paramount 
and  proximate  cause  of  death.      It  is  not  enough  that  the 
insured  may  have  been  addicted  to  habits  of  intemperance, 
indulged  in  for  a  considerable  period  prior  to  his  death.    Such 
habits  doubtless  have  a  tendency  to  shorten  life,  but  if  on 
this  ground  payment  of  a  loss  may  be  resisted,  no  insurance, 
though  knowingly  taken,  upon  the   life  of   an  intemperate 
man  would  be  of  any  value.     To  warrant  such  a  defence,  it 
should  appear  that  intemperance  was  the  cause  of  death,  so 
recently  prior  to  the  death,  and  having  such  an  obvious  con- 
nection with  it,  that  the  death  may  be  clearly  traceable  to 
it,  and  fairly  be  said  to  have  been  produced  by  it.     If  in- 
temperance is  only  a  contributory  cause,  and  not  the  sole, 
or  at  least  paramount,  cause  of  death,  the  defence  cannot 
avail;  as  in  actions  for  negligence,  the  plaintiff  cannot  re- 
cover unless  it  be  shown  that  the  negligence  of  the  party  to 
be  charged  is  something  more  than  a  contributory  cause  of 
the    injury.       Neither    intemperance    combined    with    other 
causes,  nor  intemperance  as  a  secondary,   remote,  and  pre- 
disposing cause,  even  though  it  may  have  rendered  the  in- 
sured  more  susceptible   to   the  attack  and   less  capable  of 
resisting  the  ravages  of  disease,  the  disease  being  the  con- 
trolling and  efficient  cause  of  death,  will  avoid  the  policy.^ 
The  intemperance  or  intoxication    must  also  be  voluntary, 
and   not  in    pursuance  of   the   prescription   of  a  physician, 
treating  him  in  sickness,   though  such  sickness  may  have 

might  affect  unfavorably  his  prospects  of  life  ;  while  an  untruthful  or  incorrect 
answer  to  the  specific  questions  asked  renders  the  policy  absolutely  void,  though 
made  in  relation  to  a  matter  not  material  to  the  risk."  See  also  Wilkinson  v. 
Union  Mut.  Ins.  Co.,  2  Dill.  C.  Ct.  570. 

1  Miller  v.  Mutual  Benefit  Life  Ins.  Co.,  31  Iowa,  216  ;  Holterhoff  y.  Mutual, 
&c.  Ins.  Co.  (Cincinnati  Supr.  Ct.),  3  Am.  L.  Rec.  272  ;  s.  c.  4  Big.  Life  &  Ace. 
Ins.  Cas.  395.  Some  observations  fell  from  Daly,  J.,  in  Horton  v.  The  Eqnitable 
Life  Assurance  Company  of  the  United  States  (N.  Y.  Ct.  Com.  Pleas,  1870,  ubi 
supra),  not  entirely  consistent  with  the  doctrine  stated  in  the  text.  But  thev 
were  obiter,  and  perhaps  not  well  considered.  The  point  decided  was  that  on  an 
issue  of  the  truth  of  a  statement,  the  truth  of  whieli  was  warranted,  that  at  the 
time  the  insurance  was  effected  the  insured  had  never  been  addicted  to  habits  of 
intemperance,  the  fact  that  the  death  occurred  from  an  injury  received  while 
intoxicated,  and  because  of  the  intoxicntion,  was  irrelevant, — a  decision  which 
was  no  doubt  correct.     See  Watson  v.  Mainwariug,  4  Taunt.  763  ;  ante,  §  295. 

VOL.  I,  — 41  54]^ 


§  302]  INSURANCE :    FIRE,    LIFE,   ACCIDENT,   ETC.  [CH.  XIY. 

been  caused  by  the  voluntary  excessive  use  of  the  prohibited 
article.  1  [If  a  policy  is  to  be  void  if  the  insured  becomes 
"so  far  intemperate  as  to  impair  health  or  induce  delirium 
tremens^""  and  the  death  was  substantially  caused  by  the  ex- 
cessive use  of  alcoholic  stimulants,  not  taken  for  medical 
purposes  or  under  medical  advice,  then  the  assured's  health 
was  impaired  by  intemperance  within  the  meaning  of  the 
policy,  although  he  might  not  have  had  the  delirium  tremens^ 
and  although  he  had  not  indulged  in  strong  drink  enough  to 
become  habitually  intemperate. ^  And  in  another  case  it 
was  held  that  if  the  insured  died  from  a  single  debauch, 
continued  for  one  or  for  ten  days,  he  did  become  "so  far 
intemperate  as  to  impair  his  health."  although  he  had,  pre- 
viously to  his  last  illness,  led  a  temperate,  or  even  strictly 
abstemious  life.^] 

§  302.  Death  from  Intemperance,  —  In  another  action 
against  the  same  company,*  substantially  the  same  question 
again  arose.  The  policy  provided  that  the  insurers  should 
not  be  liable  if  the  insured  should  "die  by  reason  of  intem- 
perance from  the  use  of  intoxicating  liquors."  That  the  in- 
sured so  died  was  set  up  in  defence;  and  there  was  evidence 
to  establish  the  defence,  and  that  the  insured  had  delirium 
tremens  or  mania  a  potu,  caused  by  such  intemperance,  and 
that  such  disease  is  often  fatal.  It  was  also  in  evidence 
that  morphine,  amongst  other  medicines,  was  administered 
in  large  quantities  to  the  insured  by  the  physician  called  to 
take  care  of  him,  as  a  remedy.  The  plaintiff  claimed  that 
the  treatment  was  improper,  and  that  if  the  plaintiff  had 
delirium  tremens,  the  death  of  the  insured  resulted  directly 
and  immediately  from  the  excessive  amount  of  opium  ad- 
ministered, and  not  from  the  disease.  The  defendants 
requested  the  court  to  rule  that  "  if  the  assured,  by  intem- 
perance caused  by  the  use  of  intoxicating  liquors,  brought 
upon  himself  a  disease,  fatal  in  its  nature,  and  a  physician 

1  Holterhoff  v.  Mutual  Benefit  Life  Ins.  Co.,  su}rra. 

2  [.-Etna  Life  Ins.  Co.  v.  Davey,  123  U.  S.  739.] 

3  [Davey  v.  ^tna  Life  Ins.  Co.,  38  Fed.  Rep.  650,  656  (N.  J.),  1889.] 

*  Ranney  v.   Mutual  Benefit  Life  Ins.  Co.,  tried  in  the  Circuit  Court  of  tho 
United  States  for  the  First  Judicial  District  (Mass. ),  before  Shepley,  J.,  March,  1873. 
642 


CH.  XIV.]  HEALTH,    HABITS,    AGE,    ETC.  [§  302 

was  called  in  who,  in  good  faith  and  with  intent  to  cure, 
administered  medicines  which  in  fact  contributed  to,  or 
even  caused,  the  death  of  the  insured, "  he  could  not  recover. 
This  instruction  was  refused,  but  the  court  did  instruct  the 
jury  as  follows:  "The  real  question  in  this  case  is,  whether 
intemperance  from  the  use  of  intoxicating  liquors  was  the 
cause  of  death.  If  the  disease  from  which  the  insured  was 
suffering  was  delirium  tremens  or  mania  a  potu,  or  other  dis- 
ease resulting  from  intemperance  from  the  use  of  intoxicat- 
ing liquors,  and  that  disease,  though  not  necessarily  mortal, 
yet  from  want  of  helpful  application,  or  neglect  of  proper 
care  or  treatment,  produced  exhaustion  or  fever,  and  conse- 
quent death,  the  death  would  properly  be  considered  as^  re- 
sulting from  the  intemperance,  even  if  the  disease  were  not 
so  mortal  in  itself  but  that  with  good  care  and  under  favor- 
able circumstances  the  insured  might  have  recovered ;  yet  if 
it  became  the  cause  of  death  by  reason  of  the  most  efficacious 
mode  of  treatment  not  having  been  adopted,  then  the  plain- 
tiff would  not  be  entitled  to  recover.  If  the  death  of  the 
assured  was  caused  by  any  drug  administered  to  him  in  the 
course  of  medical  practice  for  the  purpose  of  cure,  in  suffi- 
cient quantity  to  produce  death,  and  death  was  the  effect  of 
the  drug  and  not  of  the  disease,  then,  in  such  case,  the  death 
could  not  properly  be  considered  as  resulting  from  the  in- 
temperance in  the  use  of  intoxicating  liquors,  and  the  plain- 
tiff upon  that  branch  of  the  case  would  be  entitled  to 
recover."  And  the  court  further  instructed  the  jury  "that 
they  were  to  consider  whether  the  insured  caused  his  own 
death  by  the  use  of  intoxicating  drinks,  or  whether  the 
physician  caused  the  death  by  the  use  of  narcotic  drugs; 
whether  the  death  resulted  from  that  alone,  or  whether  the 
man  was  in  a  condition  in  which  they  failed  to  relieve  him 
from  the  disease,  and  left  the  disease  to  cause  the  death 
itself;  or  whether  it  was  of  itself  the  active  and  immediate 
cause  of  the  death,  and  he  would  have  recovered  but  for 
that,  — is  a  question  of  fact  for  vour  determination."^ 

1  See  also  New  York   Life  Ins.  Co.  v.  Boiteaux  (Cincinnati  Superior  Ct.),  5 
Big.  Life  &  Ace.  Ins.  Cas.  437  ;  s.  c.  4  Am.  Law  Record,  1. 

643 


§  303]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.         [CH.  XIV. 

§  303.  Materiality  of  Statements  at  the  Medical  Examina- 
tion ;  Evidence ;  Agency.  —  In  a  strongly  contested  case  in 
New  York,  the  question  arose  whether  the  examining  physi- 
cian might  testify  whether  the  statement  made  by  the  appli- 
cant, during  that  application,  that  he  was  a  man  of  means, 
influenced  his  judgment  upon  the  general  question  whether 
the  applicant  was  afflicted  with  any  disease  tending  to 
shorten  life,  and  whether  the  life  was  one  which  he  could 
recommend.  This  evidence  was  admitted,  upon  the  ground 
that  such  a  statement  was  material,  and  might  properly  in- 
fluence the  mind  of  the  medical  examiner,  for  the  same  rea- 
son that  any  statements,  though  not  strictly  relating  to  the 
risk,  if  they  are  calculated  to  determine  the  question  in  the 
mind  of  the  insurer  whether  he  will  assume  the  risk  or  not, 
are  material,  and,  if  false,  avoid  the  policy.  The  social 
relations,  the  pecuniary  circumstances,  the  fact  that  others 
skilled  in  insurance  had  taken  the  same  risk,  and  many 
other  facts  not  having  a  direct  bearing  upon  the  risk  itself, 
may,  and  doubtless  often  do,  influence  the  judgment  in  de- 
termining whether  to  assume  the  risk.  ^  (a)  The  object  of  a 
physical  examination  of  a  person  proposing  to  insure  his  life 
by  a  competent  physician,  it  was  observed  by  the  court,  is 
to  ascertain  whether  he  is  laboring  under,  or  is  subject  to, 
any  disease  or  defect  which  may  have  the  effect  to  shorten 
life.  The  inquiry  involves  an  examination  not  only  into 
the  present  state  of  the  various  organs  and  functions  of  the 
body,  but  into  the  tendency  of  these  organs  and  functions  to 
take  on  diseases  as  affected  by  habits  of  mind  as  well  as  of 

1  Sibbald  v.  Hill,  2  Dow,  263  ;  Anderson  v.  Fitzgerald,  4  H.  of  Lds.  Cas.  484. 

(a)    See  Patten  v.  United  Life  &  Ace.  Ass'n,  60  Fed.  Rep.  727  ;  Fidelity  Mut. 

Ins.   Ass'n,   133  N.  Y.  450  ;    Cobb  v.  L.   Ass'n    v.    Ficklin,    74    Md.    172 ; 

Covenant  Mut.  Benefit  Ass'n,  153  Mass.  Providence  L.   Ass.   Society  v.  Reutlin- 

176  ;  White   v.   Provident   Savings    L.  ger,   58   Ark.   528  ;    Germania   L.   Ins. 

Ass.  Society,  163  Mass.  108  ;  Brown  v.  Co.    v.  Lunkenheimer,    127    Ind.   536  ; 

Greenfield    L.    Ass'n,    172   Mass.    498  ;  O'Hara  v.   United   Brethren    Mut.  Aid 

Finch  V.  Modern  Woodmen  of  America,  Society,   134  Penn.  St.   417  ;   Kelly  v. 

113  Mich.  646;  Smith  v.  Met'n  L.  Ins.  Life  Ins.  Clearing  Co.,   113  Ala.   453; 

Co.,  183  Penn.  St.  504  ;  Mutual  L.  Ins.  Mutual  Life  Ins.  Co.  v.  Nichols  (Tex. 

Co.  V.  Arhelger  (Ariz.),  36   Pac.  895;  Civ.   App.),   26   S.  W.  998  ;  Stewart  t;. 

Aloe  V.  Mutual  Reserve  Fund  L.  Ass'n,  Equitable   Mut.    L.    Ass'n    (Iowa),    81 

147  Mo.  561  ;  Brady  v.  United  L.  Ins.  N.   W.  782. 

644 


CH.  XIV.]  HEALTH,   HABITS,   AGE,   ETC.  [§  303 

body,  temperament,  tendency  to  disease  from  hereditary 
causes,  and  the  occupation  and  condition  in  life  of  the  sub- 
ject. Of  two  persons  of  the  same  age  and  present  bodily 
health,  the  one  may  present  a  risk  entirely  safe,  the  other 
unsafe.  It  is  impossible  to  fix  limits  to  the  subject  into 
which  it  is  not  only  proper,  but  necessary,  for  an  examining 
physician  to  inquire,  in  order  to  enable  him  to  arrive  at  a 
conclusion  upon  which  he  can  properly  advise  the  accep- 
tance or  rejection.  The  fact  that  the  applicant  declares 
himself  to  be  a  man  of  means  may  affect  his  judgment  in 
such  case,  and,  if  so,  an  answer  to  that  question  is  material. 
The  physician  may  therefore  be  properly  inquired  of  if  that 
statement  affected  his  judgment  in  recommending  the  risk.^ 
On  the  other  hand,  it  has  been  held  that  where  the  medical 
examiner  had  testified  that  he  had  been  influenced  by  the 
fact  that  the  insured  had  spoken  of  his  great  powers  of 
endurance,  he  could  not  be  asked,  on  cross-examination, 
whether  if  he  had  known  of  a  certain  other  fact  touching 
his  physical  condition,  several  years  previous,  that  would 
have  influenced  his  judgment  in  recommending  the  risk.^ 

If  the  medical  examiner,  however,  it  being  made  his  duty 
to  explain,  mislead  the  applicant  into  untrue  statements  as 
to  his  health,  the  insurers  will  be  estopped  to  set  up  such 
untrue  statement  as  a  defence.  ^  [If  the  applicant  makes  a 
true  answer,  but  the  medical  examiner  writes  a  false  one, 
unknown  to  the  applicant,  the  company  is  responsible  for 
the  falsehood.*  (a)     An  applicant  for  insurance  is  not  bound 

1  Valton  V.  National  Loan  Fund  Life  Ass.  Soc,  1  Keyes  (N.  Y.),  21,  revers- 
ing s.  c.  17  Abb.  Pr.  Rep.  (N.  Y.)  268. 

2  Mutual,  &c.  Ins.  Co.  v.  Wise,  34  Md.  582. 

3  Connecticut  Life  Ins.  Co.  v.  McMurdy  (Pa.),  8  Ins.  L.  J.  509  ;  Hurd  v.  Ma- 
sonic, &c.  Soc.  (Indianapolis  Supr.  Ct.),  6  Ins.  L.  J.  792  ;  Flynn  v.  Equitable 
Life  Ass.  Soc,  7  Hun  (N.  Y.),  387 ;  s.  c.  78  N.  Y.  568.     See  also  ante,  §§  123,  214. 

*  [Grattan  v.  Met.  Life  Ins.  Co.,  92  N.  Y,  274.] 

(a)    This  is  true  even  when  the  appli-  serve  Fund  Life  Ass'n,  80  Fed.  Rep.  681 ; 

cation  declares  the  examiner  to  be  the  and    wlien    such    examiner's   report   is 

applicant's  agent:    Royal  Neighbors  of  accepted  by  the  company,  although  lie 

America  v.  Boman,  177  111.  27  ;  Mass.  was  not  originally  authorized  to  make 

Benefit  Life  Ass'n  v.  Robinson,  104  Ga.  the  examination.     Knights  of  Pytliias 

256  •  but  see  Hubbard  v.  Mutual  Re-  v.  CogbUl,  99  Teun.  28  ;  41  S.  W.  340. 

645 


§  304]  INSURANCE  :   FIRE,   LIFE,   ACCIDENT,    ETC.  [CH.  XIV. 

by  the  conclusions  of  the  examining  doctor  from  his  state- 
ments, or  by  the  doctor's  opinion  in  regard  to  them.^  Al- 
though the  medical  examiner  is  the  agent  of  the  company,  (a) 
if  he  is  also  the  beneficiary,  and  the  company  knowing  this 
issues  the  policy  on  his  examination,  he  will  not  be  com- 
pelled to  show  that  the  transaction  was  "  in  every  respect, 
just,  fair,  upright  and  clear  of  all  objection."  The  burden 
is  on  the  company  to  show  that  his  representations  were 
false,  to  the  knowledge  of  the  examiner,  or  that  he  did  not 
fairly  and  fully  state  the  applicant's  health. ^J 

§304,  Family  Physician;  Medical  Attendant.  —  A  "family 
physician  "  is  the  physician  who  usually  attends  and  is  con- 
sulted by  the  members  of  a  family  in  the  capacity  of  physi- 
cian.^ And  where  the  usual  medical  attendant  is  inquired 
for,  the  one  who  has  been  accustomed  to  attend,  and  not  the 
one  who  has  occasionally  attended,  should  be  mentioned,"* 
although  the  usual  attendant  be  a  quack.  ^  But  where  the 
usual  medical  attendant  has  not  been  called  in  for  several 
years,  and  another  is  in  attendance  at  the  time  the  policy  is 
applied  for,  it  is  for  the  jury  to  say,  if,  in  answering  the 
question,  "  Who  is  your  medical  attendant  ?  "  he  gives  the 
name  of  the  usual  attendant,  and  does  not  give  the  name  of 
his  attendant  for  the  time  being,  the  answer  is  true.^  So 
is  it  generally  a  question  for  the  jury,  whether  the  inquiry 
about  medical  attendant  is  truly  answered.^     The  object  of 

1  [Lueder's  Ex'r  v.  Hartford  Life  &  Ace.  Ins.  Co.,  4  McCrary,  149,  155.] 

2  [Fairchild  v.  North  Eastern  Miit.  Life  Ass.,  51  Vt.  613.] 

3  Price  V.  Phoenix  Mat.  Life  Ins.  Co.,  17  Minn.  497  ;  Reid  v.  Piedmont,  &c. 
Ins.  Co.,  58  Mo.  421. 

*  Huckman  v.  Fernie,  3  Mees.  &  Wels.  505 ;  Monk  v.  Union  Life  Ins.  Co.,  6 
Eobt.  (N.  Y.  Superior  Ct.)  455. 

s  Everett  v.  Desborongh,  5  Bing.  503. 

6  Maynard  v.  Rhode,  1  C.  &.  B.  360. 

■^  Scoles  V.  Universal  Life  Ins.  Co.,  42  Cal.  523  ;  Cushman  v.  United  States, 
&c.  Ins.  Co.,  70  N.  Y.  72;  Edington  v.  Mut.  &c.  Ins.  Co.,  5  Hun  (N.  Y.)  1  ; 
Scanlon  v.  Sceales,  13  Irish  (Law),  71. 

(a)    A  by-law  authorizing  the  execu-  attempt  to  appoint  a  medical  examiner 

tive  officers  or  trustees  of  a  life  com-  for  life    thereunder.      Carney   v.    New 

pany  to  appoint  employees  and  fix  their  York  L.  Ins.  Co.,  162  N.  Y.  453  ;  Beers 

compensation  is  invalid  in  so  far  as  they  v.  New  York  L.  Ins.  Co.,  66  Hun,  75. 

646 


CH.  XIV.  J  HEALTH,   HABITS,   AGE,   ETC.  [§  304 

reference  to  the  medical  attendant  is  to  obtain  the  best  in- 
formation as  to  the  quality  of  the  life  proposed,  and  it  would 
seem  that  whatever  be  the  form  of  the  inquiry,  the  answer 
should  be  such  as  the  applicant  has  reason  to  believe  will 
best  accomplish  that  object.  Thus,  in  Hutton  v.  Waterloo 
Life  Assurance  Society,  ^  where  special  inquiry  was  made  as 
to  sobriety  and  temperance,  and  also  for  the  name  and  ad- 
dress of  the  medical  attendant  of  the  insured,  and  the  an- 
swer affirmed  habits  of  sobriety  and  temperance,  and  gave 
the  name  of  a  casual  medical  attendant,  but  did  not  give  the 
name  of  a  physician  who  had  then  recently  attended  him, 
while  under  delirium  tremens,  it  was  held  to  have  been  the 
duty  of  the  applicant  to  have  disclosed  the  name  of  the 
physician  who  attended  him  for  delirium  tremens,  although 
the  jury  found  the  answer  was  not  fraudulent.  In  Forbes  v. 
Edinburgh  Life  Assurance  Company,^  the  insured  was  asked 
to  refer  to  a  "medical  man"  (if  possible,  his  usual  medical 
attendant)  to  ascertain  the  present  and  general  health  of  the 
party  to  be  assured,  and  gave  the  name  of  a  physician  who 
could  give  little  information  on  this  point,  but  omitted  to 
mention  the  name  of  one  who  might  have  been  useful  in  that 
particular;  and  though  the  case  was  decided  upon  another 
point,  the  Lord  President  expressed  himself  very  strongly 
against  this  as  a  fraud  which  would  vitiate  the  policy.  And 
when  one  is  shown  to  have  been  the  usual  medical  attend- 
ant, the  relation  will  be  presumed  to  be  continued,  unless 
a  change  be  shown,  within  reasonable  limits ;  so  that  an 
answer  by  an  applicant  that  he  has  no  usual  medical  attend- 
ant, when  in  fact  he  has  had  one  who  was  in  attendance 
within  a  month  prior  to  making  the  application,  —  there 
being  no  evidence  of  discharge,  —  is  false,  and  avoids  the 
policy.^  But  a  former  attending  physician,  who  has  retired 
from  practice,  and  has  recently  attended  in  a  single  in- 
stance, gratuitously  and  as  a  friend  in  an  emergency,  pend- 
ing the  arrival  of  another  physician  who  had  been  sent  for, 

1  1  F.  &.  F.  735.     See  also  Abbott  v.  Howard,  Hayes  (Irish),  381. 

2  10  Ct.  of  Sess.  Cas.  (Scotch)  451. 

3  Monk  V.  Union  Mut.  Life  Ins.  Co.,  6  Robt.  (N.  Y.  Superior  Ct.)  455. 

647 


§  304]  INSUKAXCE  :    FIKE,   LIFE,    ACCIDENT,    ETC.        [CH.  XIV. 

is  not,  as  matter  of  law,  an  attending  physician.     At  most, 
it  would  be  a  question  for  the   jury.^     An  answer  to  the 

1  Gibson  v.  American  Mut.  Life  Ins.  Co.,  37  N.  Y.  580.  In  the  case  in 
Minnesota,  cited  at  the  beginning  of  this  section,  as  to  the  meaning  of  the  phrase 
"family  physician,"  arriving  at  the  conclusion  above  given,  and  for  the  fol- 
lowing reasons.  Berry,  J.,  speaking  for  the  majority  of  the  court,  said :  "  The 
phrase,  '  family  physician,'  is  in  common  use,  and  has  not,  so  far  as  we  are  aware, 
any  technical  signification.  As  used  in  this  instance,  and  for  the  purposes  of  the 
testimony  appearing  in  this  case,  the  Chief  Justice  and  mj^self  are  of  opinion  that 
it  may  be  sufficiently  defined  as  signifying  the  physician  who  usually  attends, 
and  is  consulted  by  the  members  of  a  fanjih",  in  the  capacity  of  a  physician.  We 
employ  the  word  'usually,'  both  because  we  do  not  deem  it  necessary  to  consti- 
tute a  person  a  family  physician,  as  the  phrase  is  used  in  this  instance,  that  he 
should  invariably  attend  and  be  consulted  by  the  members  of  a  family  in  the 
capacity  of  ])hysiciau,  and  because  we  do  not  deem  it  necessary  that  he  should 
attend  and  be  consulted  as  such  physician  by  each  and  all  of  the  members  of  a 
family.  For  instance,  the  testimony  in  this  case  shows  that  at  the  time  when  the 
application  for  insurance  was  made,  tbe  family  of  Richard  Price  consisted  of  himself, 
his  wife,  and  two  or  three  children.  We  think  that  a  person  who  usually  at- 
tended, and  w-as  consulted  by  the  wife  and  children  of  Richard  Price  as  a  jihysi- 
cian,  would  be  the  family  physician  of  Richard  Price  in  the  meaning  of  the  above 
twenty-fifth  inteiTogatory,  although  he  did  not  usually  attend  on,  and  was  not 
usually  consulted  as  a  physician  by,  Richard  Price  himself."  The  dissenting 
opinion  by  ilcMillan,  J.,  was  as  follows  :  "  One  ground  of  defence  set  up  is,  that 
at  the  time  the  application  was  made  and  the  policy  executed,  Richard  Price,  the 
deceased,  bad  a  family  physician.  Xo  other  issue  is  taken  upon  this  interroga- 
tory. It  does  not  appear  that  the  term  '  family  physician  '  has  any  technical 
signification ;  it  is,  therefore,  for  the  court  to  determine  the  meaning  of  the 
phrase,  '  family  physician  of  the  party. '  As  here  used,  the  purpose  of  the  inter- 
rogatory was  to  obtain  the  name  and  residence  of  the  medical  attendant  best  able 
to  give  an  account  of  the  physical  condition,  at  the  times  referred  to,  of  the  per- 
son whose  life  was  assured.  Bliss  on  Life  Ins.  171.  This  intention  would  be  best 
effected  by  obtaining  a  reference  to  the  physician  who  was  the  medical  adviser  of 
such  person.  The  interrogatory,  it  seems  to  me,  was  made  to  embrace  the  two 
questions  contained  in  it,  and  jiut  in  the  alternative,  in  order  that  a  true  aSirma- 
tive  answer  to  either  would  elicit  the  address  of  the  physician  who  had  charge  of 
the  assured  as  his  medical  adviser.  In  both  questions  the  inquiry  is  for  the 
physician  of  the  party :  yet  if  the  phrase,  'family  physician  of  the  party,'  does 
not  uecessarilv  include  the  person  assured,  a  true  answer  in  many  cases  may  be 
given  to  the  first  question  embraced  in  the  interrogatory,  without  disclosing  the 
name  of  the  physician  of  the  assured  ;  for  instance,  the  person  whose  life  is 
assured  may  have  one  person  as  his  individual  physician,  and  a  different  person 
as  the  physician  of  all  the  rest  of  his  family  ;  yet  if  the  construction  given  by  my 
brethren  to  the  phrase,  'family  physician  of  the  party,'  be  correct,  it  seems  to  me 
he  might,  in  answer  to  the  incjuiry  for  his  family  physician,  truthfully  give  the 
name  of  the  physician  attending  the  other  members  of  his  family,  and  without 
the  name  of  his  personal  physician  ;  for,  according  to  this  construction,  the 
terms  of  the  question  call  for  nothing  more.  It  may  be  that  such  answer  would 
be  a  true  answer  to  the  entire  interrogatory,  but  that  is  not  the  question  before 
us  ;  the  only  point  for  us  to  determine  is,  whether  Price's  answer  is  false  in  this, 
that  he  had  a  family  physician  at  the  time,  and  answered  that  he  had  none.    I  am 

648 


CH.  XIV.]  HEALTH,    HABITS,   AGE,    ETC.  [§  305 

question,  "Have  jou  employed  any  physicians  ?  If  so,  give 
name  or  names,"  giving  the  name  of  one,  while  others  had 
been  employed,  has  been  held  to  be  "full,  true,  and  correct," 
so  far  as  it  went,  according  to  what  might  be  fairly  expected 
from  the  indefiniteness  of  the  question  in  point  of  time.^  [A 
warranty  that  the  insured  had  not  in  a  time  named  "  con- 
sulted, or  been  prescribed  for  by  a  physician,"  is  falsified  by 
proof  of  such  prescription,  though  it  were  only  for  a  cold.^] 

§  305.  Age  ;  Residence  ;  Relationship.  —  A  substantial  mis- 
representation or  equivocation  as  to  the  age  is  material,  — 
although  a  fact  not  entering  into  the  risk,  —  in  that  the  age 
is  important  in  determining  the  premium,  that  being  at  a 
greater  or  less  rate  as  the  age  is  more  or  less  advanced.' 
"It  is  trifling,"  said  Pollbck,  C.  B.,  in  the  case  last  cited, 
"to  say  that  that  is  a  true  answer  which  requires  something 
to  be  added  to  make  it  true. "  Where  there  was  a  mistake 
of  one  year  in  the  statement  of  the  age,  the  court  instructed 
the  jury  that  they  might  find  from  certain  circumstances 
that  the  insurers  were  estopped  to  deny  the  truth  of  the 
statement,  and  if  they  did  so  find,  the  verdict  should  be  for 
the  amount  which  the  premium  paid  would  insure  at  the 
actual  age.  ^(a)  [An  insurance  company,  however,  is  charge- 
unable,  therefore,  to  concur  with  my  brethren  in  the  construction  they  give  to  the 
phrase,  '  family  physician  of  the  party.*  I  think  the  phrase,  as  used  in  this  in- 
stance, means  the  physician  who  usually  attends  and  is  consulted  by  all  or  most 
of  the  members  of  the  family  of  the  person  whose  life  is  assured,  and  that  the 
person  thus  assured,  if  he  has  medical  attendance,  must  be  one  of  the  members 
attended  by  such  physician." 

1  Dilleber  v.  Knickerbocker  Life  Ins.  Co.,  76  X.  Y.  567. 

•2  [Metropolitan  Life  Ins.  Co.  v.  McTague,  49  X.  J.  587.] 

3  Cazenove  v.  Brit.  Eq.  Ass.  Co.,  6  C.  B.  N.  s.  437  ;  Murphy  v.  Hanis,  Batty 
(Irish),  206  ;  Wray  v.  Manchester  Provident  Ass.  Co.,  Xisi  Prhts,  cited  from  the 
London  Times  of  March,  1871,  by  Bliss,  Ins.  165  ;  Murphy  v.  Harris,  Batty 
(K.  B.),  206  ;  France  v.  ^tna,  &c.  Ins.  Co.,  C.  Ct.  (Pa.),  2  Ins.  L.  J.  657  ;  Ort 
lieb  V.  Northwestern  Ins.  Co.,  C.  C.  P.  Ham.  Co.  (Ohio),  4  Ins.  L.  J.  .311 ;  West 
ropp  V.  Bruce,  Batty  (K.  B.),  155  ;  Continental  Ins.  Co.  v.  Goodall  (Superior  Ct. 
Cincinnati),  3  Am.  Law  Rec.  338  ;  s.  c.  5  Big.  Life  &  Ace.  Ins.  Cas.  422.  [A 
statement  b_v  the  applicant  for  admission  to  a  company  which  did  not  receive  per 
sons  over  sixty  years  old,  that  he  was  fifty-nine  when  he  was  really  sixty-four 
invalidates  the  contract.     Swett  v.  Citizens'  Mut.  Relief  Soc,  78  Me.  541.] 

*  Epes  V.  Arlington  Ins.  Co.  (Va.),  8  Ins.  L.  J.  342. 

(a)  The  jury  are  to  be  instructed  the  risk  as  matter  of  law.  Dolan  v. 
that  an  understatement  of  age  increases    Mutual  Reserve  Fund  Life  .\ss'n,  173 

649 


§  306]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  XIV. 

able  with  knowledge  of  all  the  facts  stated  by  the  applicant 
to  the  agent  as  to  the  time  of  his  birth,  and  he  having  truly 
stated  them  ihe  agent's  misstatement  will  not  avoid  the  pol- 
icy. ^  A  German  applicant  understanding  English  very  im- 
perfectly, when  asked  his  age,  said  he  could  not  tell;  the 
agent  made  an  estimate  of  his  own  and  inserted  it  in  the 
application,  which  the  German  signed  without  knowledge  of 
the  statement;  the  company  was  held  estopped  to  set  up  the 
error  as  to  age.^]  And  it  has  been  held  that  where  the 
applicant  truly  answered  the  question  as  to  residence,  but 
failed  to  disclose  the  fact  that  she  was  in  prison  at  the  place 
of  residence,  it  might  be  material;  and  it  was  for  the  jury 
to  say  whether  it  was  or  not,  and  this  although  there  was 
nothing  in  the  policy  which  could  be  construed  as  requiring 
the  imprisonment  to  be  stated.^  And  in  the  Superior  Court 
at  Buffalo  it  was  held,  where  the  statements  were  war- 
ranties, that  a  representation  that  the  person  for  whose 
benetit  the  policy  was  taken  out  was  the  wife  of  the  appli- 
cant, when  in  fact  she  was  not,  was  untrue  and  worked  a 
forfeiture.* 

§  306.  Occupation.  —  An  untrue  statement  in  the  applica- 
tion, which  is  made  a  part  of  the  policy,  as  to  the  occupa- 
tion at  the  time  the  application   is  made,   will    avoid  the 

1  [McCall  V.  Phcenix  Ins.  Co.,  9  W.  Va.  237,  243.] 

2  [iMiller  V.  Phff-nix  Mut.  Life  Ins.  Co.,  107  N.  Y.  292.] 
^  Huguenin  v.  Rayley,  6  Taunt.  186. 

*  Stannaid  v.  Am.  Pop.  Life  Ins.  Co.,  cited  in  Bliss,  Ins.  164.  And  so  it  was 
held  in  Holabird  v.  Atlantic  Mut.  Life  Ins.  Co.,  2  Dillon,  U.  S.  C.  Ct.  166. 

Mass.  197.     See  Mutual  L.  Ins.  Co.  v.         A  misrepresentation   as   to   sex   may 

Blodgett,  8   Tex.  Civ.    App.    45.     The  also  be  material  to  the  risk  and  fatal  to 

question  of  age  is  so  material  that  sub-  a  recovery  on  the  policy,  as  where  the 

stantial  falsity  in  a  statement  in  regard  owner  was  represented  to  be  a  success- 

to  it  is  fatal,  whether  the  statement  be  ful    business   man,    when   in   fact    the 

retrarded  as  a  representation  or  a  war-  owner  was  a  woman  who  gave  no  atten- 

ranty.     McCarthy  v.  Catholic  Knights,  tion  to  the  risk.     Freedman  v.  Phila. 

102  Tenn.   345,    351  ;    Preuster  v.  Su-  F.    Ass'n,     168    Penn.     St.    249.     See 

preme  Council,  135  N.  Y.  417  ;  Albert  Mechanics'  &  Traders'  Ins.  Co.  v.  Floyd 

V.   Mutual  L.  Ins.  Co.,  122  N.  C.  92  ;  (Ky.),  28  Ins.  L.  J.  335. 
Vivar  v.  Knights  of  Pythias  (N.  J.)  20         That  an  age  limit  may  be  waived  by 

Ins.  L.  J.  373  ;  Wolf  v.  District  Grand  the   insurer,    see  Wiberg  v.   Minnesota 

Lodge,  102  IMich.  23.  S.  R.  Ass'n,  73  Minn.  297. 

650 


CH.  XIV.] 


HEALTH,    HABITS,    AGE,   ETC. 


[§306 


policy,  (a)  What  is  necessary  to  be  stated  is  the  occupation 
in  which  the  insured  is  engaged  at  the  time,  and  not  the 
occupation  in  which  he  may  have  been  generally  engaged 
before  that  time.^  If  one  who  is  in  fact  a  farmer,  and  has 
followed  that  business  from  his  youth  up,  is  occupied  in  any 
other  pursuits,  as  a  business,  at  the  time  he  seeks  insurance, 
the  special  occupation  should  be  stated,  and  not  the  general 
one.  The  existing  status  of  the  applicant,  in  this  particu- 
lar, is  that  about  which  the  insurers  are  interested  to  know, 

1  [See  §  188  A.] 


(a)  See  Wright  v.  Vermont  Life  Ins. 
Co.,  164  Mass.  302  ;  Aldricb  v.  Mer- 
cantile Mut.  Ace.  Ass'n,  149  Mass.  457  ; 
Kenyon  v.  Knights  Templar  Ass'n, 
122  N.  Y.  247  ;  Guiltinan  v.  Met'n  L. 
Ins.  Co.,  69  Vt.  469  ;  Dailey  v.  Pre- 
ferred Masonic  Mut.  Ace.  Ass'n,  102 
Mich.  289  ;  Pacific  Mut.  L.  Ins.  Co.  v. 
Snowden,  58  Fed.  Rep.  342;  Triple 
Link  Mut.  lud.  Ass'n  v.  Williams  (Ala.), 
26  So.  19  ;  Fidelity  Mut.  L.  Ins.  Co.  v. 
Ficklin,  74  Md.  172  ;  Perrin  v.  Pruden- 
tial Ins.  Co.,  61  N.  Y.  S.  249  ;  Malicki 
V.  Chicago  Guaranty  Fund  L.  Society 
(Mich.),  77  N.  W.  690  ;  Standard  Life 
&  Ac.  Ins.  Co.  V.  Ward,  65  Ark.  295  ; 
Knights  of  Maccabees  v.  Volkert  (Ind. 
App.),  57  N.  E.  203.  The  fact  that 
the  insured  is  killed  or  injured  while 
engaged  temporarily  in  an  act  or  occu- 
pation classed  as  more  hazardous  than 
the  one  in  which  he  was  accepted,  does 
not  limit  his  recovery  to  the  amount 
provided  for  such  more  hazardous  risk 
or  occupation,  when  there  has  been  no 
fraudulent  intent  to  mislead.  The  mer- 
chant who  at  one  time  measures  a  few 
bushels  of  grain,  at  another  time  hangs 
a  few  rolls  of  wall-paper  upon  his  own 
premises,  at  another  drives  horses  in  a 
carriage  or  wagon,  or  at  another  rows  a 
boat  for  exercise  or  recreation,  does  not 
change  his  occupation  so  as  to  change 
his  class  under  the  insurer's  classifi- 
cation of  risks,  or  become  at  these  sev- 
eral  times,  a  grain   measurer,  a  pajier 


hanger,  a  teamster,  or  a  boatman  ;  but 
the  word  "  occupation  "  refers  only  to 
the  vocation,  profession,  trade,  or  call- 
ing in  which  the  assured  is  engaged  for 
trade  or  profit,  and  does  not  preclude 
him  from  performing  such  individual 
acts  and  such  duties  as  are  mere  inci- 
dents in  the  daily  life  of  men  in  any 
occupation,  or  from  engaging  in  acts 
of  exercise  or  diversion.  Berliner  v. 
Travelers'  Ins.  Co.,  121  Cal.  458  ; 
Union  Mut.  Ace.  A.ss'n  v.  Frohard, 
134  111.  228  ;  Stone  v.  U.  S.  Casualty 
Co.,  34  N.  J.  L.  371 ;  Hess  v.  Preferred 
Masonic  M.  Ace.  Ass'n,  112  Mich.  196  ; 
Johnson  v.  London  Guaranty  &  Ac. 
Co.,  115  id.  86  ;  Perrin  v.  Prudential 
Ins.  Co.,  62  N.  Y.  S.  720.  So  a  parti- 
cular hazardous  exposure,  not  a  part 
of  the  insured's  occupation,  does  not 
necessarily  affect  the  policy.  Ibid.  ; 
Eaton  V.  Atlas  Ace.  Ins.  Co.,  89  Maine, 
570 ;  Kentucky  Life  &  Ac.  Ins.  Co.  v. 
Franklin  (102  Ky.),  43  S.  W.  709  ; 
Berliner  v.  Travelers'  Ins.  Co.,  121  Cal. 
451,  458  ;  Murphey  v.  American  Mut. 
Ac.  Ass'n,  90  Wis.  206  ;  Fox  v.  Masons' 
Fraternal  Ace.  Ass'n,  96  Wis.  390  ; 
Holiday  v.  American  Mut.  Ace.  Ass'n, 
103  Iowa,  178.  The  contract  made  by 
the  policy  is  not  affected,  as  to  the  in- 
sured's occupation,  by  subsequent  by- 
laws made  by  the  insurer  on  that 
subject.  Hobbs  v.  Iowa  Mut.  Ben. 
Ass'n,   82  Iowa,   107. 

651 


§306]  INSURANCE :     FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  XIV. 

and  substantial  untruth  relative  thereto  is  fatal.  ^  In  Eng- 
land, it  has  been  held  that  a  representation  that  the  appli- 
cant was  an  "  esquire  "  is  sufficient,  if  true,  although  he  was 
then  engaged  in  business  as  an  iron-monger.  Such  a  state- 
ment, said  Hill,  J.,  "is  not  untrue,  but  simply  imperfect. 
Suppose  the  applicant  had  been  a  wine-merchant  and  a 
banker,  and  had  put  down  only  that  he  was  a  banker,  could 
it  have  been  said  that  that  was  an  untrue  statement  ?  I 
think  not."  The  majority  of  the  judges  in  the  Queen's 
Bench  thought  the  word  designated  an  occupation,  and, 
being  true  as  far  as  it  went,  was  sufficient;  though  Cock- 
burn,  C.  J.,  thought  the  answer  tantamount  to  saying  that 
he  had  no  occupation,  and  was  untrue.''^  But  the  judgment 
was  affirmed  in  the  Exchequer  Chamber.^  "It  is  said,"  said 
Williams,  J.,  "the  statement  of  the  plaintiff  that  he  was  an 
esquire  was  an  untrue  statement,  because  it  was  a  suppres- 
sion of  the  truth ;  the  truth  being  that  he  was  also  an  iron- 
monger. But  there  is  no  foundation  for  the  argument.  The 
plaintiff  said,  in  effect,  I  am  in  that  position  in  life  in  which 
people  are  usually  addressed  as  esquires.  A  man  who  is  in 
such  a  position  is  no  more  deserving  of  the  imputation  of 
telling  an  untruth  by  calling  himself  an  esquire,  without 
adding  his  trade,  than  a  peer  of  the  realm  would  be  who 
should  describe  himself  as  such,  and  not  also  state  that  he 
was  a  brewer,  banker,  or  ironmaster,  as  the  case  might  be." 
But  the  position  of  the  defendant's  counsel,  that,  "in  with- 
holding the  fact  that  he  was  an  ironmonger  he  was  guilty  of 
a  sujypressio  veri  tantamount  to  a  positive  statement  that  he 
had  no  occupation,"  does  not  seem  to  be  satisfactorily  an- 
swered. The  language  of  Williams,  J.,  shows  that  esquire 
was  a  mere  title  of  courtesy  indicative  of  social  position,  and 
if  this  case  is  law,  then  a  man  who  is  actually  engaged  in 
the  business  of  manufacturing  nitro-glycerine  or  gunpowder, 
if  he  happen  to  be  a  peer,  need  only  state  the  latter  fact. 
Yet  a  peer  would  know,  presumably,  that  the  fact  that  he 

1  Hartman  v.  Keystone  Ins.  Co.,  31  Pa.  St.  466. 

2  Pen-ins  v.  Mar.  &  Gen.  Tr.  Ins.  Co.,  2  E.  &  E.  317. 

3  2  E.  &  E.  324. 

652 


CH.  XIV.j  HEALTH,   HABITS,   AGE,   ETC.  [§  306 

was  a  peer  was  of  little  or  no  moment  to  the  insurers,  while 
the  fact  that  he  was  engaged  in  a  hazardous  business  was  of 
the  greatest  moment.  It  would  seem  that  if  a  man  have  two 
or  more  occupations,  if  he  be  not  required  to  state  all,  he 
ought  at  least  to  state  that  one  which  he  has  reason  to  be- 
lieve the  insurers  are  most  interested  to  know,  and  whether 
he  had  done  this  in  the  particular  case  would  be  for  the  jury 
to  say.  Perhaps,  as  was  said  by  Black,  J.,  in  the  case  from 
Pennsylvania,  above  cited,  where  the  warranty  was  that  the 
statement  was  in  all  respects  true,  such  warranty  ought  not 
to  be  held  to  include  "  inaccuracies  which  are  not  material. " 
But  substantial  truth  certainly  is  required  both  by  the  con- 
ditions of  the  contract  and  by  the  good  faith  which  ought  to 
inspire  the  answers  to  such  questions.^  And  there  is  no 
such  substantial  difference  between  a  "  soda-water  maker " 
and  a  vender  of  soda-water  as  to  work  a  forfeiture.  ^  If  the 
statement  of  present  occupation  be  true,  however,  any  subse- 
quent change  will  not  avoid  the  policy,  if  not  so  stipulated.^ 

1  And  see  Smith  v.  iEtna  Life  Ins.  Co.,  49  N.  Y.  211. 

2  Grattan  v.  Metropolitan  Ins   Co.,  80  N  Y.  281. 

3  Provident  Life  Ins.  of  Chicago  v.  Fennell,  49  lU.  180. 

653 


INSURANCE :   FIKE,   LIFE,   ACCIDENT,   ETC.  [CH.  XV. 


CHAPTER  XV. 


SUICIDE. 

Analysis. 

§  307.  "Taking  one's   own  life,"  or  "death  by  one's  own  hands,"  is 

usually  excepted  in  life  policies. 
a  policy  obtained  with  intent  to  eonimit  suicide  would  be 

void  without  any  proviso,  §  307,  n. 
but  one  bona  fide  taken,  with  no  provision  covering  self-de- 
struction, or  contemplation  of  it,  should  be  sustained 
in  the  absence  of  a  clause  of  exception ;  the  point  how- 
ever is  doubtful  on  authority  ;  see  below,  §§  323-324. 
when  there  is  an  exception,  voluntary  death  by  one  in  pos- 
session of  his  faculties  is  within  it  by  all  authorities, 
_  §  307. 
while  accidental,  unintended  death  is  not,  though  by  one's 
own  act  ;  (see  also  §  321). 
although  the  policy  expressly  excludes  death  by  tak- 
ing poison,  such  taking  by  mistake  is  not  fatal  to 
the  policy,  though  it  may  be  to  the  man,  §  307. 
but  in  regard  to  suicide  by  an  insane  person,  opinions 
differ,  §  307  et  scq, 
§  308.  "  Death  by  his  own  hand  "  held  to  mean  the  same  as  suicide,  felo 

de  se,  criminal  self-destruction  (see  also  §  316).     Every 
man  in  providing  for  his  family  must  contemplate  that 
insanity  is  one  of  the  diseases  by  which  he  may  die. 
Three  opinions  (or  two  at  least)  as  to  when  the  excep- 
tion applies. 
(1)  Insured  must  be    morally  responsible   and  not  under    irresistible 
impulse. 
In  order  to  avoid  the  policy  the  insured  must  be  able  to  appre- 
ciate the  nature  and  quality  of  his  action,  and  must  act 
voluntarily  in  the  sense  of  being  morally  responsible,  and 
not  under  the  control  of  an  irresistible  impulse,  §§  307,  n., 
308,    316.     The    person    whose    life  is   insured  gets   no 
money,  and  the  love  of  life  is  strong  enough  generally  to 
guard  against  death  for  the  benefit  of  others.     One  who 
dies  by  his  own  insane  act  dies  by  disease,  and  the  form  it 
takes  does  not  alter  the  fact,  §  311.     Even  clear  intelli- 
gence has   been  held  not  to  bring  the  case  within  the 
exception,  where  the  will  was  subordinated  to  uncontrol- 
lable emotion,  §  312. 

654 


CH.  XV.]  SUICIDE. 

5  309  (2)   Clear  understanding  of  physical  nature  of  iU  ax:t  enough.     Some 

*        '  cases  hold  that  the  exception  applies  if  the  assured  knew 

what  he  was  doing  and  that  the  consequence  of  his  act 
would  be  death,  but  that  if  unconscious  of  what  he  was 
doina,  and  acting  under  an  insane  delusion  overpowering 
his  will,  it  does  not  apply,  §§  307,  309  ;  see  also  §§  317, 
318. 
This  is  the  best  view  ;  see  next  paragraph. 
§  310  (3)  Evidence  of  insanity  excluded.     Some  cases  go  as  far  as  that  in 

^  their   assertions,  saying   that  the  act  of  seli-destruction 

brings  the  case  within  the  letter  of  the  agreement,  and  that 
the  c°ourt  could  not  qualify  the  contract  made  by  the  par- 
ties  §  310.     The  case,  however,  as  qualified  in  the  opin- 
ion,' seems  identical  in  princiide  with  the  second  group. 
The  court  say  that  moral  responsibility  does  not  affect  the 
question.     It  was  against  intentional  self-destruction  that 
the  company  provided,  to  secure  itself  again.st  any  motive 
of  the  insured  to  provide  for  his  dear  ones  by  taking  him- 
self off;  and  such  a  motive  may  act  on  a  diseased  mind 
as  well  as  on  one  that  is  sound  ;  (see  also  §  316,  2). 
This   seems  the  sense   and  spirit  of  the  matter.     The  letter 
covers  all  self-killing  ;  but  the  reason  of  the  exception  must 
govern  and  the  policies  should  protect  the  beneficiaries  so 
far  as  possible.     They  need  it  as  much  in  case  of  suicide 
as  in  any  other.     On  the  other  hand,  to  hold  "  death  by 
his  own  hand  "  identical  with  criminal  suicide,  and  to  re- 
quire  moral   responsibility   and  freedom  from  irresistible 
impulse,  is  clearly  making  a  new  contract  very  different 
from  the  plain  sense  and  spirit  of  the  words.    It  is  a  ques- 
tion if  any  impulse  that  causes  action  is  resistible.     The 
prospect  of  providing  for  wife    and    family  may  in  some 
states  of  mind  be  an  irresistible  motive,  yet  it  is  the  very 
one  the  company  wishes  to  exclude. 
One  thing  is  clear,  there  must  be  an  intent  to  take  his  life. 
§  321. 
accident,  overpowering  force,  or  a  fit  of  delirium  or  frenzy 
are  not  within  the  stipulation,  §§  310,  5,  320  ;  but  if 
the  will  acts  though  the  ])erson  is  not  responsible,  the 
policy  is  void,  §§  313-315. 
S  S22  rhe   insurers  may  eliminate  the  question  of  insanity  by  express 

S  ^     •  ^^j.^lg^  1ji;t  thev  will  have  to  be  very  careful  to  make  those 

words' strong  and  clear.     "  Die  by  his  own  hand  under  any 
circumstances  "  is  not  enough,  nor  "sane  or  otherwisp,"nor 
"  voluntary  or  involuntary;  "  but  "  felonious  or  otherwise  " 
has  been  held  sufficient,  and  "  sane  or  insane  "  is  certainly 
so,  —  at  least  the  courts  have  not  yet  found  a  way  to  over- 
come it. 
a  by-law  subsequent  to  the  policy  will  not  do. 
sometimes  there  is  a  provision  to  pay  back  the  premiums  and 
interest  in  case  of  suicide. 
S  323.  Suicide  in  a  fit  of  insanity  does  not  affect  the  policy  unless  there  is 

^        '  an  express  provision,  §  323. 

655 


§  307]  INSUKANCE  :    FIEE,   LIFE,    ACCIDENT,   ETC.  [CH.  XV. 

and  there  is  some  authority  that  no  suicide  will  affect  heirs 
and  beneficiaries  unless  so  jn-ovided,  §  324  ;  a  policy 
issued  for  the  benefit  of  a  third  person  is  not  affected  by 
suicide,  although  vohintary  and  sane. 
An  express  insurance  against  voluntary  suicide  is  void  as  against 
public  policy. 
§  324.  except  as  in  favor  of  one  bona  fide  interested  in  the  policy 

for  value. 

§  307.  Suicide;  Death  by  One's  own  Hands;  Taking  One's 
own  Life.  —  Prominent  among  the  causes  which  insurance 
companies  have  provided^  shall  exempt  them  from  liability 
under  life  policies  is  death  by  suicide ;  or,  as  it  is  sometimes 
expressed,  if  the  insured  "shall  die  by  his  own  hands,"  or 
"take  his  own  life."  It  is  prominent  also  in  the  difficulty 
which  has  been  found  in  determining  the  meaning  of  the 
provision,  and  the  learning  and  ability  which  has  been  dis- 
played in  the  attempt.  The  courts  seem  to  delight  in  its 
discussion.  There  seems  to  be  about  this  question  a  fasci- 
nation which  the  judicial  mind  is  unable  to  resist;  and 
whenever  the  question  presents  itself,  whether  in  the  courts 
of  Westminster  Hall,  or  those  of  our  western  wilderness,  it 
has  given  rise  to  so  many  and  such  interesting  opinions  as 
to  have  secured  for  the  student,  if  not  relief  from  his  per- 
plexing doubts,  at  all  events  recreation  and  instruction 
while  he  is  devoting  himself  diligently  to  inquiries  which 
he  hopes  may  result  in  such  relief. 

Upon  the  question  of  voluntary  suicide  intentionally  com- 
mitted by  a  sane  man  in  the  possession  of  his  faculties, 
knowing  how  to  adapt  means  to  ends,  and  conscious  of  the 
immorality  of  the  act,  there  is  not,  as  indeed  there  could  not 
well  be,  any  difference  of  opinion,  and  all  authorities  agree 
that  such  a  suicide  is  within  the  exemption.  And  all  the 
authorities  likewise  agree  that  an  accidental  death,  as  by 
taking  poison  ^  by  mistake,   or  shooting  one's  self  with  a 

1  [A  policy  obtained  with  intent  to  commit  suicide  is  void  for  fraud  in  its 
inception,  without  any  clause  concerning  self-destruction.  Smith  v.  National 
Ben.  Soc,  51  Hun,  575.] 

2  [Even  a  policy  which  expressly  excludes  death  "  by  taking  poison  "  does  not 
cover  a  case  of  taking  poison  by  mistake,  and  the  beneficiary  in  such  a  case  can- 
not recover.     Pollock  u.  United  States  Mut.  Ace.  Ass.,  102  Pa.  St.  230.] 

656 


CH.  XV.]  SUICIDE.  [§  307 

pistol,  supposing  it  not  to  be  loaded,  or  falling  from  a 
building,  or  death  happening  in  any  way  by  the  unintended 
act  of  the  party  dying,  is  not  within  the  exemption. i  But 
whether  suicide  by  an  insane  man  is  also  within  the  exemp- 
tion has  been  the  question  in  dispute,  and  upon  this  two 
prominent  and  different  doctrines  have  been  maintained. 
On  the  one  hand,  it  is  maintained  that  if  the  act  be  volun- 
tarily done  in  pursuance  of  an  intelligent  purpose,  and  in- 
tentionally and  intelligently  carried  out  by  the  proper 
adaptation  of  means  to  ends,  it  is  suicide  on  the  part  of 
the  insured,  or  death  by  his  own  hands,  although  insanity 
exist  to  such  an  extent  that  he  may  not  be  able  to  appreci- 
ate the  moral  qualities  of  the  act. 2  On  the  other  hand,  it  is 
maintained  with  equal  vigor,  that,  however  intelligently  the 
act  may  be  done,  if  at  the  time  the  will  be  overpowered  by 
an  uncontrollable  impulse,  or  the  party  be  unable  to  appre- 
ciate the  moral  character  of  the  act,  it  is  not  within  the 
meaning  of  the  provision. ^      [Where  the   insured   fell,  and 

^  [A  death  by  accidental  or  unintentional  self-killing,  is  not  suicide  voluntary 
or  involuntary.  Keels  v.  Mutual  Reserve  Fund  Ass.,  29  Fed.  Rep.  198  (S.  C), 
1886.  And  a  condition  for  avoidance  in  case  the  assured  shall  die  by  his  own 
hand,  sane  or  insane,  does  not  cover  a  case  of  death  by  act  of  the  insured  not 
intended  to  cause  death,  as  by  an  overdraught  of  whiskey  taken  as  medicine  in  a 
weak  state  of  health.  Northwestern  Mut.  Life  Ins.  Co.  v.  Hazelett,  105  Ind. 
212.] 

2  [The  company  must  show  that  the  insured  knew  the  physical  nature  of  his 
act,  and  that  it  would  result  in  self-destruction  ;  but  is  not  bound  to  show  that 
he  was  legally  or  morally  responsible.  Mutual  Ben.  Life  Ins.  Co.  v.  Daviess' 
Ex'x,  87  Ky.  541.  It  makes  no  difference  that  he  was  incapable  of  knowing  the 
moral  nature  of  his  act.  Nimick  v.  Mutual  Ins.  Co.,  10  Am.  L.  Reg.  n.  s.  101 ; 
3d  Cir.  (Pa.)  1881  ;  Gay  v.  Union  Mut.  Life  Ins.  Co.,  9  Blatch.  142.] 

3  [If  the  reason  of  the  insured  is  so  far  impaired  that  he  does  not  understand 
the  general  nature,  consequences,  and  moral  character  of  his  act,  or  if  he  is  im- 
pelled to  it  by  an  insane  impulse  that  he  has  not  the  power  to  resist,  the  death 
is  not  within  the  contemplation  of  the  parties  to  the  exception,  and  the  company 
is  liable.  Life  Ins.  Co.  v.  Terry,  15  Wall.  580  ;  Waters  v.  Conn.  Mut.  Life  Ins.  Co., 
2  Fed.  Rep.  892  ;  9  Ins.  L.  J.  337.  It  is  difficult  to  see  what  this  leaves  of  the 
exception,  for  every  suicide  is  due  to  "  an  insane  impulse  which  the  victim  has  not 
the  power  to  resist."  Suppiger  v.  Covenant  Mut.  Ben.  Ass.,  20  Brad.  595.  Sui- 
cide and  self-destruction  are  synonymous,  and  in  law  imply  capacity  to  form  a 
legal  intention  and  deliberate  action.  Wherefore  if  the  insured  was  not  able  to 
understand  the  moral  nature  of  his  act,  or  was  impelled  by  an  impulse  too  strong 
for  him  to  resist,  it  is  not  self-destruction,  although  he  knew  and  intended  that 
the  result  of  his  act  should  be  fatal.     New  Home  Life  Ass.  v.  Hagler,  29  111,  App. 

VOL.  I. —  42  657 


§  309]  INSUKANCE:   FIRE,   LIFE,   ACCIDENT,    ETC.  [CH.  XV. 

about  six  weeks  after  became  insane,  and  took  his  life,  it 
was  held  that  the  question  whether  the  fall  was  the  cause  of 
the  killing  was  too  conjectural  to  be  submitted  to  the  jury 
as  a  direct  cause  of  self-destruction.  ^  Stating  the  disease  of 
which  the  insured  died  is  a  satisfactory  mode  of  excluding 
the  hypothesis  of  self-destruction,   &c.2] 

§§  308,  309.  "  Death  by  his  own  Hand,"  —  And  hereupon 
there  has  been  hitherto,  and  still  is  an  irreconcilable  con- 
flict of  opinion,  both  among  different  courts  and  among  the 
different  judges  of  the  same  court.  And  while  at  one  time 
it  seemed  that  the  former  opinion  was  likely  to  become  the 
prevailing  one,  both  from  the  character  and  from  the  num- 
ber of  the  courts  and  judges  who  adopted  it,  at  this  moment 
it  must  be  admitted  that  there  is  little  reason  upon  such 
grounds  to  look  for  such  a  result;  and  the  question,  in  this 
country  at  least,  must  still  be  considered  an  open  one,  with 
the  preponderance,  perhaps,  in  favor  of  the  latter  view.  We 
have  therefore  no  alternative  but  to  give  its  history,  and  by 
so  doing  we  shall  best  show  the  present  state  of  the  question. 
The  question  first  arose  in  New  York,  in  a  case "  of  self- 
destruction  by  drowning,  where  the  defence  was  suicide,  to 
which  there  was  a  reply  that  the  insured  was  insane  at  the 
time,  and  this  reply  was  demurred  to.     The  insurers  were 

437.  A  self-killing  by  an  insane  person,  understanding  the  physical  nature  and 
consequences  of  his  act,  but  not  its  moral  aspect,  is  not  a  death  by  suicide.  J. 
Gray,  in  Manhattan  Life  Ins.  Co.  i;.  Broughton,  109  U.  S.  121.  A  policy  against 
" bodily  injuries  effected  through  external,  accidental,  and  violent  means,"  ex- 
cept those  "caused  wholly  or  in  part  by  bodily  infirmities  or  disease,  or  by  sui- 
cide or  self-inflicted  injuries,"  covers  a  death  by  hanging  one's  self  while  insane. 
The  act  of  an  insane  person  is  no  more  his  act  in  the  sense  of  the  law  than  if  he 
had  been  impelled  by  irresistible  physical  power.  By  the  decisions  of  this  court, 
whether  the  unsoundness  of  mind  is  such  as  to  destroy  understanding  of  tlie  phys- 
ical nature  and  consequences  of  the  act,  or  only  to  obliterate  the  perception  of 
its  moral  nature,  self-killing  by  an  insane  person  is  not  suicide,  or  death  by  his 
own  hand.  Insanity,  moreover,  is  not  a  "  bodily  "  disease,  but  a  mental  disease, 
and  so  not  within  the  excepting  clause.  Accident  Ins.  Co.  v.  Crandal,  120  U.  S. 
527,  531-534.] 

1  [Streeter  v.  Insurance  Co.,  65  Mich.  199.] 

2  [Covenant  Mut.  Ben.  Ass.  i'.  Hoffman,  110  111.  608.] 

3  Breasted  v.  Farmers'  Loan  &  Trust  Co.,  4  Hill  (N.  Y.),  73.  The  English 
cases  are  all  cited,  and  their  results  sufficiently  stated  in  the  American  cases 
refeiTcd  to. 

658 


CH.  XV.]  SUICIDE.  [§  309 

not  to  be  liable  if  the  assured  should  die  by  his  own  hand. 
The  plaintiffs  had  judgment  upon  the  demurrer,  and  this 
judgment  was  afterwards  affirmed  by  the  Court  of  Appeals. ^ 

1  Nelson,  C.  J.,  here  said  :  "  The  question  arising  upon  the  demurrer  is, 
whether  Comfort's  self-destruction  in  a  fit  of  insanity  can  be  deemed  a  death 
iy  his  own  hand,  within  the  meaning  of  the  policy.  I  am  of  opinion  that  it 
cannot.  ...  The  connection  in  which  the  words  stand  in  the  policy  would  seem 
to  indicate  that  they  were  intended  to  express  a  criminal  act  of  self-destruction, 
as  they  are  found  in  conjunction  with  the  provision  relating  to  the  termination  of 
the  life  of  the  insured  in  a  duel,  or  by  his  execution  as  a  criminal.  This  associa- 
tion  may  well  characterize  and  aid  in  determining  the  somewhat  indefinite  and 
equivocal  import  of  the  phrase.  Speaking  legally,  also  (and  the  policy  should  be 
subjected  to  this  test),  self-destruction  by  a  fellow-being,  bereft  of  reason,  can 
with  no  more  propriety  be  ascribed  to  the  act  of  his  own  hand,  than  the  deadly 
instrument  that  may  have  been  used  for  the  purpose.  The  drowning  of  Comfort 
was  no  more  his  act,  in  the  sense  of  the  law,  than  if  he  had  been  impelled  by 
irresistible  physical  power ;  nor  is  there  any  greater  reason  for  exempting  the 
company  from  the  risk  assumed  in  the  policy,  than  if  his  death  had  been 
occasioned  by  such  means.  Construing  these  words,  therefore,  according  to 
their  true,  and,  as  1  apprehend,  universally  received  meaning  among  insurance 
offices,  there  can  be  no  doubt  that  the  termination  of  Comfort's  life  was  not 
within  the  saving  clause  of  the  policy.  Suicide  involves  the  deliberate  termina- 
tion of  one's  existence  while  in  the  possession  and  enjoyment  of  his  mental 
faculties.  Self-slaughter  by  an  insane  man  or  a  lunatic  is  not  an  act  of  suicide 
within  the  meaning  of  the  law."     4  Bl.  Coram.  189  ;  1  Hale's  P.  C.  411,  412. 

Ten  years  later  this  judgment  was  affirmed  in  the  New  York  Court  of  Appeals. 
8  N.  Y.  299.  (Five  judges  for  affirmation,  three  for  reversal.)  The  case  was 
sent  to  a  referee,  and  on  appeal  from  his  finding  Willard,  J.,  for  the  majority, 
said  :  "  It  is  material  to  determine,  in  the  first  place,  what  is  meant  by  the  term, 
death  by  his  oion  hand,  which  is  to  avoid  the  policy.  If  the  words  are  construed 
according  to  the  tetter,  an  accidental  death  caused  by  the  instrumentality  of  the 
ha7id  of  the  insured  would  fall  within  the  exception.  Thus,  should  the  insured, 
by  mistake,  swallow  poison,  and  thereby  terminate  his  life,  his  representatives 
could  not  recover  on  the  policy  if  the  poison  was  conveyed  to  his  mouth 
Tjy  his  oivn  hand.  The  same  rule  of  construction  applied  to  the  words,  death 
hy  the  hands  of  justice,  in  the  same  connection,  would  take  the  case  out 
of  the  exception,  if  the  death  was  occasioned  by  strangulation  by  a  rope  instead 
of  the  hands  of  the  minister  of  justice.  But  it  is  too  plain  for  argument 
that  the  literal  meaning  is  not  the  true  meaning  of  either  phrase.  ...  In 
popular  language,  the  term  death  hy  his  own  hand  means  the  same  as  suicide,  or 
felo  dc  se.  The  first  two,  indeed,  are  not  technical  terms,  and  viay  be  used  in  a 
sense  excluding  the  idea  of  criminality.  The  connection  in  which  they  are  used 
in  this  policy  indicates  that  the  ]>hrase  death  hy  his  own  hand  meant  an  act  of 
criminal  self-destruction.  Provisos  declaring  the  policy  to  be  void  in  case 
the  assured  commit  svicide  or  die  by  his  own  hand,  are  used  indiscriminately 
as  expressing  the  same  idea.  In  the  note  to  Borradaile  v.  Hunter,  5  Man.  &  Gr. 
639,  648,  are  given  the  forms  of  the  proviso  used  by  seventeen  of  the  principal 
London  insurance  companies.  In  eight  of  them  the  exception  is  of  a  death  hy 
suicide,  and  in  nine  of  a  death  by  the  assnred's  own  hands.  In  two,  separate 
provisioa  is  made  in  case  of  a  deatli  by  suicide  not  felo  dc  se,  and  in  two  others  in 

G59 


§  310]  INSURANCE  :    FIRE,    LIFE,   ACCIDENT,   ETC.  [CH.  XV. 

§310.    Life  Insurance;  Suicide.  —  The  question  next  came 

case  of  a  death  by  his  own  liands,  not  felo  de  se.  It  is  obvious,  therefore,  that 
the  phrase,  death  by  kis  own  hand  aud  death  by  suicide  mean  the  same  thing, 
and  that  both,  unless  qualified  by  some  other  ex[]ressious,  import  a  criminal 
act  of  self-destruction.  The  connection  in  which  they  stand  in  this  policy 
favors  this  construction.  The  first  four  excei)tions  in  the  policy  are  of  acts 
innocent  in  themselves,  three  of  which  become  inoperative  if  the  defendants  give 
their  consent  aud  have  it  indorsed  on  the  policy.  Then  follow  the  last  four 
exceptions  ;  viz.,  if  lie  shall  die  by  his  own  hand,  or  in  consequence  of  a  duel,  or 
by  the  hands  of  justice,  or  in  the  known  violation  of  any  law,  &c.  By  the 
acknowledged  rule  of  construction,  noscitur  a  sociis,  the  first  member  of  the  sen- 
tence, if  there  be  any  doubt  as  to  its  meaning,  should  be  controlled  by  the  other 
members,  which  are  entirely  unequivocal,  and  should  be  construed  to  mean  a 
felonious  killing  of  himself.  Broom's  Maxims,  293,  450.  It  is  a  note  laid  down 
by  Lord  Bacon  that  copulatio  verborum  indicat  acccptionem  in  eodem  sensu ;  the 
coupling  of  words  together  shows  that  they  are  to  be  understood  in  the  same 
sense.  And  when  the  meaning  of  any  particular  word  is  doubtful  or  obscure,  or 
when  the  expression,  taken  singly,  is  inojierative,  the  intention  of  the  partie.? 
using  it  may  frequently  be  ascertained  and  carried  into  effect  by  looking  at  the 
adjoining  words,  or  at  expressions  occurring  in  other  parts  of  the  same  instru- 
ment, for  quce  non  valeant  singula  juncta  juvant.  Bacon's  Works,  vol.  iv.  p.  26  ; 
2  Buls.  Broom's  Maxims,  293.  Besides,  the  words  in  this  case  are  those  of 
the  insurer,  and,  if  susceptible  of  two  meanings,  should  be  taken  most  strongly 
against  him.  It  was  not  contended  on  the  i)art  of  the  defendant  that  the  policy 
would  be  avoided  by  a  mere  accidental  destruction  of  life  by  the  party  himself. 
It  was  urged  that  it  would  be,  if  the  act  was  done  intentionally,  although  under 
circumstances  which  would  exempt  the  party  from  all  moral  culpability.  It  was 
insisted  that  the  expression  must  be  taken  to  mean  a  death  by  his  own  act.  It 
seems  to  me  that  this  is  a  yielding  of  the  whole  question.  An  insane  man, 
incapable  of  discerning  between  right  and  wrong,  can  form  no  intention.  His 
acts  are  not  the  result  of  thought  or  reason,  aud  no  more  the  subject  of  punish- 
ment than  those  which  are  produced  by  accident.  The  acts  of  a  madman,  which 
are  the  offspring  of  the  disease,  subject  him  to  no  criminal  resiionsibility.  If  the 
insured,  while  engaged  in  his  trade  as  a  house-joiner,  had  accidentally  fallen 
through  an  opening  in  the  chamber  of  a  house  he  was  constructing,  and  lost  his 
life,  the  argument  concedes  that  the  insurer  would  have  been  liable.  The 
reason  is  that  the  mind  did  not  concur  with  the  act.  How  can  this  differ  in 
principle  from  a  death  in  a  fit  of  insanity,  when  the  party  had  no  mind  to  concur 
in  or  oppose  the  act  ?  It  must  occur  to  every  prudent  man  seeking  to  make  pro- 
vision for  his  family  by  an  insurance  on  his  life,  that  insanity  is  one  of  the 
diseases  which  may  terminate  his  being.  It  is  said  the  defendants  did  not  insure 
the  continuance  of  the  intestate's  reason.  Nor  did  they  in  terms  insure  him 
against  the  small-pox  or  scarlet-fever  ;  but  had  he  died  of  either  disease,  no 
doubt  the  defendants  would  have  been  liable.  They  insured  the  continuance  of 
his  life.  "What  difference  can  it  make  to  them  or  to  him,  whether  it  is  ter- 
minated by  the  ordinary  course  of  a  disease  in  his  bed,  or  whether  in  a  fit  of 
delirium  he  ends  it  himself?  In  each  case  the  death  is  occasioned  by  means 
within  the  meaning  of  the  policy,  if  the  exception  contemplates,  as  I  think  it 
does,  the  destruction  of  life  by  the  intestate  while  a  rational  agent,  responsible  for 
his  acts.  ...  It  is  urged  that  because  a  person  non  compos  mentis  is  liable  civtliter 
for  torts  committed  while  in  a  state  of  insanity,  therefore  insanity  has  no  effect 

660 


CH.  XV.]  SUICIDE.  [§  310 

before  the  Supreme  Court  of  Massachusetts,   in  1862,^  and 

to  qualify  this  exception  in  the  policy.  That  conchision  is  not  a  legitimate 
deduction  from  the  premises.  A  rational  man  is  liable  civiliter  for  an  injury 
occasioned  by  an  accident,  unless  it  be  an  inevitable  one,  and  yet  no  one 
pretends  that  the  insurer  is  not  liable  for  a  death  by  accident,  whether  inevitable 
or  not.  Indeed,  the  liability  for  death  by  accident  was  conceded  on  the  argu- 
ment. A  death  by  accident,  and  a  death  by  the  party's  own  hand,  when 
deprived  of  reason,  stand  on  principle  in  the  same  category.  In  both  cases  the 
act  is  done  without  a  controlling  mind.  If  the  insurer  is  liable  in  the  one  case, 
he  should  be  in  the  other.  If  the  insured  was  compelled  by  duress  to  take  his 
own  life,  it  will  hardly  be  contended  that  the  insurers  could  avoid  payment.  In 
what  consists  the  dilference  between  the  duress  of  men  and  duress  of  Heaven  ? 
Can  a  man  be  said  to  do  an  act  prejudicial  to  the  insured  when  he  is  compelled  to 
do  it  by  irresistible  coercion  ?  and  can  it  make  any  difference  whether  this 
coercion  come  from  the  hand  of  man  or  the  visitation  of  Providence  ? 

"  But  it  is  urged  that  this  is  a  civil  action,  and  the  contract  of  insurance  a 
civil  contract.  Be  it  so.  A.  person  so  destitute  of  reason  as  not  to  know  the  con- 
sequences of  his  acts  can  make  no  valid  contract.  Whether  the  incompetency  be 
the  result  of  disease  or  of  intoxication,  his  contracts  made  while  in  that  condition 
are  void.  Barrett  v.  Buxton,  2  Aikens  (Vt.),  167,  ajiproved  by  Chancellor  Wal- 
worth in  Prentice  o.  Achorn,  2  Paige,  31,  and  by  Chancellor  Kent,  in  2  Comm. 
451  ;  Smith's  Law  of  Contracts,  329,  333,  and  notes.  If  the  party  could  do  no 
act  to  bind  himself,  he  certainly  could  do  none  to  bind  the  insurer.  If  he  could 
not  make  a  bond,  he  could  not  make  a  release.  If  he  could  not  make  a  will,  he 
could  not  revoke  one.  The  liability  of  a  lunatic  for  necessaries  rests  upon  the 
ground  that  the  law  will  raise  a  contract  by  imj)lication  on  the  part  of  the  luna- 
tic, in  favor  of  the  party  who  has  supplied  them  in  good  faith,  and  therefore  does 
not  affect  the  present  question.  Wentworth  v.  Tubb,  1  Younge  &  Coll.  Ch.  171. 
The  cases  on  this  head  are  analogous  to  that  of  an  infant.  See  Smith's  Law  of 
Contracts,  325  ct  seq.,  and  notes,  where  the  cases  are  collected  and  reviewed. 
The  law,  to  prevent  a  failure  of  justice,  will  imphj  a  promise  by  a  party  incapable 
of  making  a  contract;  but  it  will  never  imply  that  a  party  incapable  of  distin- 
guishing between  right  and  wrong  was  guilty  of  a  fraud.  At  the  time  this  case 
was  decided  by  the  Supreme  Court  on  the  demurrer  there  had  been  no  case,  either 
in  this  country  or  in  England,  in  which  the  same  question  had  arisen.  The  case 
of  Borradaile  v.  Hunter,  5  Man.  &  Gr.  639,  decided  by  the  English  Common 
Pleas  in  1843,  has  since  been  reported.  That  action  was  brought  by  the  executor 
of  the  insured  upon  a  life  policy  containing  a  proviso  that  in  case  the  assured 
should  die  by  his  own  hands,  or  by  the  hands  of  justice,  or  in  consequence  of  a 
duel,  the  policy  should  be  void.  The  assured  threw  himself  into  the  Thames  and 
was  drowned.  Upon  an  issue,  whether  the  assured  died  by  his  own  hands,  the 
jury  found  that  he  voluntaribj  threw  himself  into  the  water,  knowing  at  the  time 
that  he  should  thereby  destroy  his  life,  and  intending  thereby  to  do  so ;  but  at 
the  time  of  committing  the  act  he  was  not  capable  of  judging  between  right  and 
wrong.  It  was  held  by  a  majority  of  the  court,  Tindal,  C.  J.,  dissenting,  that 
the  policy  was  avoided,  as  the  proviso  included  all  acts  of  vohintnri/  self-destruc- 
tion, and  was  not  limited  by  the  accompanying  proviso  to  acts  of  felonious  sui- 


1  Dean  v.  American  Life  Ins.  Co.,  4  Allen  (Mass.),  96.  The  opinion  was 
by  Bigelow,  C.  J.  : — (1)  "There  can  be  no  doubt  that  the  facts  agreed  by 
the  parties  concerning  the   mode  in  which  the  assured  destroyed  bis  own  life 

661 


§  310]  INSURANCE  :    FIRE,   LIFE,    ACCIDENT,    ETC.         [CH.  XV. 

was  very  elaborately  considered.     The  insured  had  cut  his 

cide.  The  three  judges  who  formed  the  majority  laid  the  main  stress  upon  the  fact 
that  the  jury  found  the  act  of  self-destruction  to  be  voluntary,  that  he  knew  when 
he  threw  himself  into  the  river  he  should  thereby  destroy  his  life,  and  that  he 
intended  thereby  to  do  so.  The  referees  in  the  present  case  have  not  found  that 
the  intestate  acted  voluntarily,  or  that  he  knew  the  consequence  of  his  act.  They 
merely  find  that  wliile  insane,  for  the  purpose  of  drowning  himself,  he  threw  himself 
into  the  river,  not  being  mentally  capable  of  distinguishing  between  right  and  wrong. 
If  Borradaile  v.  Hunter  be  an  authority  which  we  ought  to  follow,  it  difl'ers  so 
much  from  the  case  before  us,  that  we  are  at  liberty  to  decide  it  upon  principle. 

"  After  the  case  of  Borradaile  v.  Hunter,  the  case  of  Schwabe  v.  Clift  was  tried 
at  Nisi  Piius,  before  Cresswell,  J.  It  was  upon  a  policy  upon  the  life  of  the 
plaintitrs  intestate,,  containing  the  proviso  that  if  the  assured  should  ^commit 
suicide,  or  die  by  duelling  or  by  the  hands  of  justice,'  the  policy  should  be  void. 
The  assured  died  from  the  effects  of  sulphuric  acid  taken  by  himself,  but  evidence 
was  given  tending  to  show  that  at  the  time  he  took  the  sulphuric  acid  he  was  in 
part  of  unsound  mind.  In  his  charge  to  the  jury,  tire  learned  judge  said  that,  to 
bring  the  case  within  the  exception,  it  must  be  made  to  appear  that  the  deceased 
died  by  his  own  voluntary  act ;  that  at  the  time  he  committed  the  act  he  could 
distinguish  between  right  and  wrong,  so  as  to  be  able  to  understand  and  appre- 
ciate the  nature  and  quality  of  the  act  he  was  doing  ;  and  that,  therefore,  he  was 
at  that  time  a  responsible  being.  The  jury  found  for  the  plaintiff."  2  Car.  & 
Kirwan,  134.  This  cause  was  afterwards  brought  into  the  Court  of  Exchequer 
Chamber  on  the  bill  of  exceptions,  and  will  be  found  in  3  Man.  &  Gr.  437,  by  the 
title  of  Clift  V.  Schwabe.  That  court,  by  a  vote  of  four  to  two,  ordered  a  new 
trial,  holding  that  the  direction  was  erroneous  ;  for  that  the  terms  of  the  condi- 
tion included  all  acts  of  voluntary  self-destruction,  and  therefore,  if  A.  voluntarily 
killed  himself,  it  was  immaterial  whether  he  was  or  was  not  a  resi)onsible  moral 
agent.  The  case  is  open  to  the  same  remark  as  Borradaile  v.  Hunter,  sui)ra.  It 
turned  upon  the  assumed  lact  that  the  act  of  suicide  was  voluntar'y,  a  fact  not 
found  by  the  referees  in  this  case.  In  the  above  quoted  case,  Gardner,  J.,  dissent- 
ing, said  :  "It  is  by  tlie  finding  established  that  the  assured  cast  himself  into  the 
river  for  the  purpose  of  drowning  himself.  The  act  committed  by  him  was  there- 
fore voluntary,  and  accompanied  bj-  so  much  intelligence  as  to  enable  the  agent 
to  contemplate  a  particular  result,  and  adopt  the  means  requisite  to  accomjdish  it- 
His  object  was  self-destruction  by  drowning.  For  this  purpose  he  cast  himself 
into  the  river,  and  thereby  effected  it.  If  this  was  not  '  dying  by  his  own  hand,' 
within  the  spirit  and  intent  of  this  clause  of  the  policy,  it  is  difficult  to  attach 
any  legal  significance  to  such  language.  If,  under  the  same  circumstances,  the 
assured  had  destroyed  the  property  or  assaulted  the  person  of  a  citizen,  he  would 
have  been  civilly  responsible  for  all  the  damages  sustained  by  the  latter.  Weaver 
V.  Ward,  Hob.  134;  Cross  v.  Andrews,  Cro.  Eliz.  622.  Insanity,  unless  it  sus- 
pended the  power  of  volition,  would  be  no  justification  ;  still  less  a  want  of  moral 
perception  to  distinguish  between  right  and  w-rong.  I  can  perceive  no  reason 
why  upon  the  same  principle  he  should  not  be  held  responsible  for  a  wilful  breach 
of  contract  resultiiig  from  self-destruction,  where  it  was  premeditated,  and  accom. 


bring  this  case  within  the  strict  letter  of  the  proviso  in  the  policy,  by  which 
it  was  stipulated  that  it  should  be  void  and  of  no  effect  if  the  assured 
should  'die  by  his  own  hand.'  The  single  question,  therefore,  which  we 
have    to    determine    is,    whether,     on    the    well-settled     principles    applicable 

662 


CH.  XY.]  SUICIDE.  [§  310 

throat  with  a  razor,    and  the  plaintiffs,   in  answer  to  the 

plished  by  means  usual  and  ajipropriate  to  effect  his  design.  In  Bagster  v.  Earl 
of  Portsmouth,  7  Dowl.  &  Eyl.  614,  it  was  held  that  a  lunatic  was  capable  of  con- 
tracting for  necessaries.  'Imbecility  of  mind,'  says  Abbott,  C.  J.,  'may,  or 
may  not,  be  a  defence  in  the  case  of  an  unexecuted  contract.'  These  cases  show 
that  the  assured,  although  insane,  is  a  responsible  agent  for  some  purposes,  and 
consequently,  a  fortiori,  that  he  can  be  affected  and  bound  by  a  condition  which 
qualifies  the  liability  of  the  insurers,  and  which,  in  terms,  is  made  to  depend 
upon  an  act  to  be  performed  by  the  former.  In  Borradaile  i;.  Hunter,  5  Man.  & 
Gr.  639,  in  a  life  policy  containing  the  same  proviso  found  in  the  one  before  us, 
the  jury  found  that  the  insuied  '  voluntarily  threw  himself  into  the  water,  know- 
ing at  the  time  that  he  should  thereby  destroy  his  life,  and  intending  thereby  to 
do  so,  but  at  the  time  of  committing  the  act  he  was  not  capable  of  judging  be- 
tween right  and  wrong.'  It  was  held  that  the  policy  was  avoided.  The  proviso 
included  all  acts  of  self-destruction,  and  was  not  limited  by  the  accompanying 
provisos  to  acts  of  felonious  suicide.  This  decision  was  pronounced  in  1843,  and 
the  case  is  not  distinguishable  from  the  one  under  consideration.  The  case  cited 
was  argued  and  decided  as  one  of  insanity,  in  which,  however,  the  assured  was 
capable  of  voluntary  action.  Erskine,  J.,  remarked,  'that  all  the  contract  re- 
quired was,  that  the  act  of  self-destruction  should  be  the  voluntary  and  wilful  act 
of  a  man  having  at  the  time  sufficient  power  of  mind  to  understand  the  physical 
nature  and  consequence  of  the  act,  and  having  the  intention  to  choose  his  own 
death.'  In  that  case,  and  in  the  present,  the  incapability  of  distinguishing  be- 
tween right  and  wrong  was  the  measure  of  the  insanity  of  the  assured.  Four  years 
afterwards,  Clift  i\  Schwabe  was  decided  in  the  Exchequer  Chamber,  3  C.  B.  437; 
3  Man.,  Gr.  &  Scott,  437,  upon  a  policy  in  which  the  word  '  suicide  '  occurred  in 
place  of  the  phrase  '  dying  by  his  own  hands.'  The  issue  was  upon  the  fact  of  sui- 
cide, and  an  exception  to  the  charge  of  the  judge  :  it  was  held  that  the  terms  of  the 
condition  included  all  acts  of  voluntary  self-destruction,  and  if  the  insured  vol- 
untarily killed  himself,  it  was  innnaterial  whether  he  was  or  not  a  responsible  moral 
agent.  These  cases  are  directly  in  point ;  that  last  mentioned  is  much  stronger 
for  the  assured  than  the  one  now  under  consideration.  When  this  case  was  before 
the  Supreme  Court  on  demurrer,  the  replication  averred  that  when  the  assured 
drowned  himself  he  was  of  unsound  mind  and  wholly  unconscious  of  the  act.  This 
was  admitted  by  the  demurrer,  and  the  question  whether  voluntary  action  can 
exist  without  some  degree  of  consciousness,  is  very  different  from  the  one  pre- 
sented by  the  finding  before  us."  The  phrase  "wholly  unconscious  of  the  act" 
refers  to  the  real  nature  and  character  of  the  act,  as  a  crime,  and  not  to  the  mere 
act  itself.     Bigelow  v.  Berkshire  Life  Ins.  Co.,  93  U.  S.  284. 


to  the  construction  of  contracts,  we  can  so  interpret  the  language  of  the 
policy  as  to  add  to  the  proviso  words  of  qualification  and  limitation,  b}'  which 
the  natural  import  of  the  terms  used  by  the  ])arties  to  express  their  meaning 
will  be  so  modified  and  restricted  that  the  case  will  be  taken  out  of  the  pro- 
viso, and  the  policy  be  held  valid  and  binding  on  the  defendants.  In  other 
words,  the  inquiry  is  whether  the  proviso  can  be  so  read  that  the  policy  was  to  be 
void  in  case  the  assured  should  die  by  his  own  hand,  he  being  sane  when  the 
suicide  was  committed.  If  these  or  equivalent  words  cannot  be  added  to  the  pro- 
viso, or  if  it  cannot  be  held  that  they  are  necessarily  implied,  then  it  must  follow 
that  the  language  used  is  to  have  its  legitimate  and  ordinary  signification,  by 
which  it  is  clear  that  the  policy  is  void.     (2)  In  considering  this  question,  we 

663 


§  310]  INSURANCE  :   FIRE,    LIFE,   ACCIDENT,   ETC.  [CH.  XV. 

objection  that  his  death  was  by  his  own  hands,   offered  to 

are  relieved  of  one  difficulty  which  has  embarrassed  the  discussion  of  the  same 
subject  in  other  cases.  If  the  proviso  had  excepted  from  the  policy  death  by 
'  suicide,'  it  would  have  been  open  to  the  plaintiffs  to  contend  that  this  word  was 
to  have  a  strict  technical  definition,  as  meaning  in  a  legal  sense  an  act  of  criminal 
self-destruction,  to  which  is  necessarily  attached  the  moral  responsibility  of  taking 
one's  life  voluntarily,  and  in  the  full  exercise  of  sound  reason  and  discretion.  But 
the  laugunge  of  the  proviso  is  not  necessarily  limited  by  the  mere  force  of  its 
terms.  The  words  used  are  of  the  most  conij)rehensive  character,  and  are  suf- 
ficiently broad  to  include  every  act  of  self-destruction,  however  caused,  without 
regard  to  the  moral  condition  of  the  mind  of  the  assured,  or  his  legal  responsibility 
for  his  acts.  (8)  Applying,  then,  the  first  and  leading  rule  by  which  the  con- 
struction of  contracts  is  regulated  and  governed,  we  are  to  inquire  what  is  a 
reasonable  interpretation  of  this  clause  according  to  tlie  intent  of  the  parties.  It 
certainly  is  very  difficult  to  maintain  the  pro[iosition  that,  where  parties  reduce 
their  contract  to  writing,  and  put  their  stipulations  into  clear  and  unambiguous 
language,  they  intended  to  agree  to  anything  different  from  that  which  is  plainly 
expressed  by  the  terms  used.  It  is,  however,  to  be  assumed  that  every  part  of  a 
contract  is  to  be  construed  with  reference  to  the  subject-matter  to  which  it  relates, 
and  with  such  limitations  and  qualifications  of  general  words  and  phrases  as  prop- 
erly arise  and  grow  out  of  the  nature  of  the  agreement  in  which  they  are  found. 
Giving  full  force  and  effect  to  this  rule  of  interpretation,  we  are  unable  to  see  that 
there  is  anything  unreasonable  or  inconsistent  with  the  general  purpose  which  the 
parties  had  in  view  in  making  and  accepting  the  policy,  in  a  clause  which  excepts 
from  the  risks  assumed  thereby  the  death  of  the  assured  by  his  own  hand,  irre- 
spective of  the  condition  of  bis  mind,  as  affecting  his  moral  and  legal  responsibil- 
ity at  the  time  the  act  of  self-destruction  was  consummated.  Every  insurer,  in 
assuming  a  risk,  imposes  certain  restrictions  and  conditions  upon  his  liability. 
Nothing  is  more  conmioi)  than  the  insertion,  in  policies  of  insurance,  of  exceptions 
by  which  certain  kinds  or  classes  of  hazards  are  taken  out  of  the  general  risk  which 
the  insurer  is  willing  to  incur.  Especially  is  this  true  in  regard  to  losses  which 
may  arise  or  grow  out  of  an  act  of  the  party  insured.  Such  exceptions  are 
founded  on  the  reasonable  assumption  that  the  hazard  is  increased  when  the  in- 
surance extends  to  the  conseiiuences  which  may  flow  from  the  acts  of  the  person 
who  is  to  receive  a  benefit  to  himself  or  confer  one  on  others  by  the  happening  of 
a  loss  within  the  terms  of  the  policy.  Where  a  party  procures  a  policy  on  his 
life,  payable  to  his  wife  and  children,  he  contemplates  that,  in  the  event  of  his 
death,  the  sum  insured  will  inure  directly  to  their  benefit.  So  far  as  a  desire  to 
provide  in  that  contingency  for  the  welfare  and  comfort  of  those  dependent  on  him 
can  operate  on  his  mind,  he  is  open  to  the  temptation  of  a  motive  to  accelerate  a 
claim  for  a  loss  under  the  policy  by  an  act  of  self-destruction.  Against  an  in- 
crease of  the  risk  arising  from  such  a  cause,  it  is  one  of  the  objects  of  the  proviso 
in  question  to  protect  the  insurers.  Although  the  assured  can  derive  no  pecuniary 
advantage  to  himself  by  hastening  his  own  death,  he  may  have  a  motive  to  take 
his  own  life,  and  thus  to  create  a  claim  under  the  policy,  in  order  to  confer  a 
benefit  on  those  who,  in  the  event  of  his  death,  will  be  entitled  to  receive  the  sum 
insured  on  his  life.  Unless,  then,  we  can  say  that  such  a  motive  cannot  operate 
on  a  mind  diseased,  we  cannot  restrict  the  words  of  the  proviso  so  as  to  except 
from  the  risk  covered  by  the  policy  only  the  case  of  criminal  suicide,  where  the 
assured  was  in  a  condition  to  be  held  legally  and  morally  responsible  for  his  acts. 
It  certainly  would  be  contrary  to  experience  to  affirm  that  an  insane  person  can- 

664 


CH.  XV.]  SUICIDE.  [§  310 

show  that  the  death  was  caused  during  a  state  of  insanity. 
But  this  was  held  inadmissible. 

not  be  iufliienced  and  governed  in  his  actions  by  the  ordinary  motives  which 
operate  on  the  human  mind.  Doubtless  there  may  be  cases  of  delirium  or  raving 
madness  where  the  body  acts  only  from  frenzy  or  blind  impulse,  as  there  are  cases 
of  idiocy  or  the  decay  of  mental  power,  in  which  it  acts  only  from  the  ]irompt- 
ings  of  the  lowest  animal  instincts.  But  in  the  great  majority  of  cases  where 
reason  has  lost  its  legitimate  control,  and  the  power  of  exercising  a  sound  and 
healthy  volition  is  lost,  the  mind  still  retains  sufficient  power  to  supply  motives 
and  exert  a  direct  and  essential  control  over  the  actions.  In  such  cases,  the  effect 
of  the  disease  often  is  to  give  undue  prominence  to  surrounding  circumstances 
and  events,  and,  by  exaggerating  their  immediate  effects  or  future  consequences, 
to  furnish  incitement  to  acts  of  violence  and  folly.  A  person  may  be  insane,  en- 
tirely incapable  of  distinguishing  between  right  and  wrong,  and  without  any  just 
sense  of  moral  responsibility,  and  yet  retain  sufficient  powers  of  mind  and  reason 
to  act  with  premeditation,  to  understand  and  contemplate  the  nature  and  conse- 
quences of  his  own  conduct,  and  to  intend  the  results  which  his  acts  are  calculated 
to  produce.  Insanity  does  not  necessarily  operate  to  deprive  its  subjects  of  their 
hopes  and  fears,  or  the  other  mental  emotions  which  agitate  and  influence  the 
minds  of  persons  in  the  full  possession  of  their  faculties.  (4)  On  the  contrary, 
its  effect  often  is  to  stimulate  certain  powers  to  extraordinary  and  unhealthy  ac- 
tion, and  thus  to  overwhelm  and  destroy  the  due  influence  and  control  of  the 
reason  and  judgment.  Take  an  illustration.  A  man  may  labor  under  the  insane 
delusion  that  he  is  coming  to  want,  and  that  those  who  look  to  him  for  support 
will  be  subjected  to  the  ills  of  extreme  poverty.  The  natural  effect  of  this  species 
of  insanity  is  to  create  great  mental  depression,  under  the  influence  of  which  the 
sufferer,  with  a  view  to  avoid  the  evils  and  distress  which  he  imagines  to  be  im- 
pending over  himself  and  those  who  are  dependent  upon  him  for  support,  is 
impelled  to  destroy  his  own  life.  In  such  a  case,  suicide  is  the  wilful  and  volun- 
tary act  of  a  person  who  understands  its  nature,  and  intends  by  it  to  accomplish 
the  result  of  self-destruction.  He  may  have  acted  from  an  insane  impulse,  which 
prevented  him  from  appreciating  the  moral  consequences  of  suicide  ;  but,  never- 
theless, he  may  have  fully  comprehended  the  physical  effect  of  the  means  which  he 
used  to  take  his  own  life,  and  the  consequences  which  might  ensue  to  others  from 
the  suicidal  act.  It  is  against  risks  of  this  nature  —  the  destruction  of  life  by  the 
voluntary  and  intentional  act  of  the  party  assured — that  the  excejition  in  the 
proviso  is  intended  to  protect  the  insurers.  The  moral  responsibility  for  the  act 
does  not  affect  the  nature  of  the  hazard.  The  object  is  to  guard  against  loss 
arising  from  a  particular  mode  of  death.  The  causa  causans,  the  motive  or  in- 
fluence which  guided  or  controlled  the  will  of  the  party  in  committing  the  act,  is 
immaterial,  as  affecting  the  risk  which  the  insurers  intended  to  except  from  the 
policy.  This  view  is  entirely  consistent  with  the  nature  of  the  contract.  It  is  the  or- 
dinary case  of  an  exception  of  a  risk  which  would  otherwise  fall  within  the  general 
terms  of  the  policy.  These  comprehended  death  by  disease,  either  of  the  body 
or  brain,  from  whatever  cause  arising.  The  proviso  exempts  the  insurers  from 
liability  when  life  is  destroyed  by  the  act  of  the  party  insured,  although  it  may  be 
distinctly  traced  as  the  result  of  a  diseased  mind.  It  may  well  be  that  insurers 
would  be  willing  to  assume  the  risk  of  the  results  flowing  from  all  diseases  of  the 
body,  producing  death  by  the  operation  of  physical  causes,  and  yet  deem  it  ex- 
pedient to  avoid  the  hazards  of  mental  disorder,  in  its  effects  on  the  will  of  the 
assu'-ed,  whether  it  originated  in  bodily  disease,  or  arose  from  external  circum- 

■    665 


§  311]         insurance:  fiee,  life,  accident,  etc.       [ch.  xv. 
§  311.    Afterwards,    in  1866,   the   question   arose   in   the 

stances,  or  was  produced  by  a  want  of  moral  and  religious  principle.  (5)  It  was 
urged  very  strongly  by  the  learned  counsel  for  the  plaintiffs,  that  this  view  of  the 
construction  of  the  contract  was  open  to  the  fatal  objection  that  it  would  neces- 
sarily lead  to  the  absurd  conclusion  that  death  occasioned  by  inevitable  accident 
or  overpowering  force,  or  in  a  fit  of  delirium  or  frenzy,  if  the  proximate  and  im- 
mediate cause  was  the  liand  of  the  person  insured,  would  be  excepted  from  the 
risks  assumed  by  the  defendants.  But  this  objection  is  sufficiently  answered  by 
the  obvious  suggestion  that  such  an  interpretation,  although  within  the  literal 
terms  of  the  proviso,  would  be  contrary  to  a  reasonable  intent,  as  derived  from 
the  subject-matter  of  the  contract.  An  argument  having  for  its  basis  a  reductio 
ad  ahsurdum  is  not  entitled  to  much  weight  when  it  is  necessary  to  ascertain 
the  intention  of  the  parties  to  a  contract,  and  to  conform  to  that  intention  in 
giving  an  interpretation  to  the  language  used.  Indeed,  when  it  becomes 
necessary  (as  the  case  on  the  part  of  the  plaintiff  requires)  to  desert  the  literal 
import  of  terms  adopted  by  parties  to  express  their  meaning,  as  it  cannot 
be  reasonably  supposed  that  they  intended  to  enter  into  stipulations  which 
would  be  unreasonable  or  absurd,  all  conclusions  which  tend  to  establish 
such  a  result  are  necessarily  excluded.  The  question  in  such  cases  is  not  how 
far  can  the  literal  meaning  of  words  be  extended,  but  what  is  a  reasonable  limita- 
tion and  qualification  of  them,  having  regard  to  the  nature  of  the  contract  and 
the  objects  intended  to  be  accomplished  by  it.  Applying  this  principle  to  the 
present  proviso,  and  assuming  that  the  plaintiffs  are  right  in  their  position,  that 
the  words  used  are  not  to  be  interpreted  literally,  it  would  seem  to  be  reasonable 
to  hold  that  they  were  intended  to  except  from  the  policy  all  cases  of  death 
caused  by  the  voluntary  act  of  the  assured,  when  his  deed  of  self-destruction  was 
the  result  of  intention,  by  a  person  knowing  the  nature  and  consequences  of  the 
act,  although  it  may  have  been  done  under  an  insane  delusion,  which  rendered 
the  party  morally  and  legally  irresponsible,  incapable  of  distinguishing  between 
right  and  wrong,  and  which,  by  disturbing  his  reason  and  judgment,  impelled 
him  to  its  commission.  If  the  suicide  was  an  act  of  volition,  however  excited  or 
impelled,  it  may  in  a  just  sense  be  said  that  he  died  by  his  own  hand.  But  be- 
yond this  it  would  not  be  reasonable  to  extend  the  meaning  of  the  proviso.  If 
the  death  was  caused  by  accident,  by  superior  and  overwhelming  force,  in  the 
madness  of  delirium,  or  under  any  combination  of  circumstances  from  which  it 
may  be  fairly  inferred  that  the  act  of  self-destruction  was  not  the  result  of  the 
will  or  intention  of  the  ]iarty  adapting  means  to  the  end,  and  contemplating  the 
physical  nature  and  effects  of  the  act,  then  it  may  be  justly  held  to  be  a  loss  no' 
excepted  within  the  meaning  of  the  proviso.  A  party  cannot  be  said  to  die  by 
his  own  hand  in  the  sense  in  which  these  words  are  used  in  the  policy,  whose 
.self-destruction  does  not  proceed  from  the  exercise  of  an  act  of  volition,  but  is  the 
result  of  a  blind  impulse,  of  mistake  or  accident,  or  of  other  circumstances  over 
which  the  will  can  exercise  no  control.  (6)  In  seeking  to  ascertain  the  inten- 
tion of  parties,  some  weight  is  to  be  given  to  the  practical  results  which  would 
be  likely  to  follow  from  the  adoption  of  a  particular  construction  of  the  words  of 
a  contract.  It  is  reasonable  to  suppose  that  these  were  in  contemplation  of  the 
insurers  at  the  time  the  policy  was  issued.  Certainly  it  is  fair  to  infer  that  they 
intended  to  put  some  material  limitations  upon  their  liability  by  the  insertion  of 
this  proviso.  But  if  it  is  to  be  construed  as  including  only  cases  of  criminal 
self-destruction,  it  would  rarely,  if  ever,  effect  this  object.  Those  familiar  with 
the  business  of  insurance,  and  with  the  results  of  actions  on  policies  of  insurance 

666 


CH.  xy]  suicide.  [§  311 

Supreme  Court  of  Maine,   in   Eastabrook  v.  Union   Mutual 

in  courts  of  law,  know  how  difficult  it  is  to  establish  a  case  of  exemption  from 
liability  under  an  exception  in  a  policy,  where  it  depends  on  a  question  of  fact  to 
be  decided  by  the  verdict  of  a  jury.  If  this  is  true  in  regard  to  ordinary  claims 
under  policies,  it  is  obvious  that  the  difficulty  would  be  greatly  enhanced  in  cases 
like  the  present,  where  it  would  be  sufficient,  in  order  to  take  a  case  out  of  the 
operation  of  the  proviso,  to  prove  that  self-destruction  was  the  result  of  insanity. 
It  would  not  be  hazardous  to  affirm  that,  in  all  cases  where  such  an  issue  was  to 
be  determined  bj^  a  jury  between  an  insurance  company  and  the  representatives  of 
the  deceased,  the  act  of  suicide  would  be  taken  as  proof  of  insanity.  Such  con- 
siderations were  not  likely  to  have  escaped  the  intention  of  practical  men  in 
framing  this  general  proviso  ;  and  in  a  doubtful  case  of  construction,  they  are 
not  to  be  overlooked  in  giving  an  interpretation  to  the  words  used  by  them. 

(7)  The  learned  counsel  for  the  plaintiffs  have  insisted  with  great  force  on  an 
argument  drawn  from  tlie  context,  to  show  that  the  proviso  was  intended  to 
embrace  only  a  case  of  criminal  self-destruction  by  a  reasonable  and  responsible 
being.  But  it  seems  to  us  that  the  maxim  noscitur  a  sociis,  on  which  they  rely, 
does  not  aid  the  construction  for  which  they  contend.  The  material  part  of  the 
clause  is,  that  the  policy  shall  be  void  if  the  assured  '  shall  die  by  his  own  hand, 
or  in  consequence  of  a  duel,  or  by  the  hands  of  justice,  or  in  the  known  violation 
of  any  Stale,  national,  or  provincial  law.'  Now  the  first  and  most  obvious  con- 
sideration suggested  by  other  parts  of  this  clause  is,  that  in  enumerating  the 
causes  of  death  which  shall  not  be  deemed  to  be  within  the  risks  covered  by  the 
policy,  one  of  them  is  in  terms  made  to  depend  on  the  existence  of  a  criminal  in- 
tention. It  is  a  '  known  violation  of  law '  which  is  to  avoid  the  polic}'.  This 
tends  very  strongly  to  show  that  where  an  act  ))rodHcing  death  may  be  either 
innocent  or  criminal,  if  it  is  intended  to  except  only  such  as  involves  a  guilty 
intent,  it  is  carefully  so  expressed  in  the  proviso.  The  inference  is  very  strong 
that  if  they  designed  to  confine  the  exception  in  question  to  cases  of  criminal 
suicide,  it  would  have  been  so  provided  in  explicit  terms.  So  far,  the  argument 
drawn  from  the  context  does  not  support  the  plaintiffs'  claim.  Take,  then, 
another  of  the  causes  of  death,   death  in  a  duel,  enumerated  in  the  proviso. 

(8)  It  seems  to  us  to  be  a  petitio  principii  to  assume  that  death  in  consequence 
of  a  duel  necessarily  implies  an  act  for  which  the  party  would  be  criminally 
responsible.  Why  is  not  this  part  of  the  proviso  open  to  the  same  argument  as 
that  which  is  urged  in  regard  to  the  clause  relating  to  self-destruction  ?  A  duel 
may  be  fought  by  a  party  acting  under  duress,  or  impelled  thereto  by  an  insane 
delusion,  which  might  blind  his  moral  perceptions  and  render  him  legally  irre- 
sponsible. If  so,  then  the  same  answer  to  a  defence  set  up  against  a  claim  under 
the  policy  would  be  open  under  this  clause,  as  the  one  now  urged  in  belialf  of  the 
plaintiffs ;  and  the  argument  founded  on  the  assumption  that  a  forfeiture  under 
this  part  of  the  proviso  necessarily  involves  a  criminal  violation  of  law,  falls  to 
the  ground.  Therefore  the  inference  that  a  guilty  intention  is  communicated 
from  this  branch  of  the  proviso  to  that  relating  to  death  by  the  act  of  the  assured, 
seems  to  us  to  be  unfounded.  The  only  remaining  clause  is  that  which  provides 
for  the  case  of  death  by  the  hands  of  justice.  This  undoubtedly  implies  that  the 
person  insured  has  been  found  guilty  of  a  criminal  act  by  a  judicial  tribunal, 
according  to  the  established  forms  of  law.  But  it  is  not  correct  to  say  that  it 
involves  the  existence  of  a  criminal  intent,  because  it  might  be  shown  that  the 
conviction  of  the  assured  was  erroneous,  and  that  he  was  in  fact  innocent  of  the 
crime  for  which  he  suffered  the  penaltv  of  death.     So  far,    therefore,   as  any 

667 


§311]  INSUKANCE:   FIRE,   LIFE,   ACCIDENT,   ETC.  [CH.  XV. 

Life  Insurance  Company,  ^  where  it  was  held  that  the  repre- 

argument  can  be  justly  drawn  from  the  connection  in  wliicli  the  words  as  to 
self-destruction  stand  in  relation  to  other  jiarts  of  the  proviso,  it  leads  to  the 
conclusion  that  it  was  not  solely  death  occasioned  by  acts  of  the  assured  involving 
criminal  intent  or  a  wilful  violation  of  law  by  a  i)ersou  morally  and  legally 
responsible,  which  was  intended  to  be  excepted  from  the  risks  assumed  by  the 
insurers;  but  that,  with  the  exception  of  death  in  a  known  violation  of  law,  the 
proviso  embraces  all  cases  where  life  is  taken  in  consequence  of  the  causes  specified, 
without  regard  to  the  question,  whether  at  the  time  the  assured  was  amenable 
for  his  act,  either  in  foro  conscicntice  or  in  tlie  tribunals  of  justice.  (9)  It 
may  be  added  that  a  departure  from  the  literal  terms  of  a  contract  is  always 
attended  with  great  difficulty  and  danger,  because  it  is  apt  to  lead  to  great  lati- 
tude of  construction,  and  to  give  uncertainty  to  the  language  which  the  parties 
have  adopted  to  ex[iress  their  meaning.  It  certainly  never  should  be  extended 
beyond  the  clear  intent  of  the  parties,  as  derived  from  other  parts  of  the  agree- 
ment, or  the  subject-matter  to  which  the  contract  relates.  This  position  may  be 
illustrated  by  reference  to  another  part  of  the  policy  declared  on.  The  proviso 
which  ])rece<les  that  on  which  the  present  question  has  arisen  contains  a  stipula- 
tion that  the  policy  shall  be  void  if  the  assured,  without  the  consent  of  the 
defendants  in  writing,  shall  during  certain  portions  of  the  year  visit  the  more 
southerly  parts  of  the  United  States,  or  shall  pass  without  the  settled  limits  of 
the  United  States.  If  the  assured  in  a  fit  of  insanity  should  wander  from  his 
home  and  go  within  the  prohibited  territory,  would  the  [lolicy  be  void  ?  If  he 
was  taken  prisoner  and  went  thither  with  his  captors,  would  he  lose  his  claims 
under  the  policy  ?  These  and  similar  questions  which  might  arise  under  other 
clauses  of  the  policy,  seem  to  show  that  it  is  more  safe  to  adhere  to  the  strict 
letter  of  the  contract,  and  to  hold  parties  to  the  salutary  rule  which  requires  them  to 
exjiress  in  clear  and  unambiguous  terms  any  exceptions  which  they  desire  to  en- 
graft on  the  general  wonls  of  a  contract.  (10)  So  far  as  the  adjudicated  cases 
bear  on  the  question  which  we  have  considered  in  the  present  case,  the  weight  of 
authority  is  against  the  claim  of  the  plaintifl's  under  the  policy.  In  the  case  of 
Borradaile  v.  Hunter,  5  Man.  &  Gr.  639,  where  the  policy  contained  a  proviso 
very  similar  to  that  found  in  the  policy  declared  on,  it  was  held  that  the  policy 
was  avoided,  as  the  proviso  included  all  cases  of  voluntary  self-destruction,  and 
was  not  limited  to  acts  of  criminal  suicide.  From  this  opinion  there  was  a  dis- 
sent by  the  Chief  Justice.  In  Clift  v.  Schwabe,  3  C.  B.  437,  a  similar  decision 
was  made  by  the  Exchequer  Chamber,  two  of  the  judges  dissenting.  These  cases 
seem  now  to  be  regarded  as  having  settled  the  law  of  England  in  conformity  with 
the  opinion  of  the  majority  of  the  judges.  Dufaur  v.  Professional  Life  Ass.  Co., 
25  Beav.  599,  602.  A  different  "opinion  was  arrived  at  in  Breasted  v.  Farmers' 
Loan  and  Trust  Company,  4  Hill  (N.  Y.),  74,  and  4  Selden,  299,  from  which, 
however,  several  of  the  most  learned  justices  of  the  Court  of  Appeals  dissented. 
(11)  In  1  Phil.  Ins.,  sect.  895,  it  is  stated  that  any  mental  derangement  sufficient 
to  exonerate  a  party  from  a  contract  would  render  a  person  incapable  of  occa- 
sioning the  forfeiture  of  a  policy  under  a  clause  like  the  one  in  question.  In 
.support  of  this  proposition  no  authorities  are  cited  except  the  cases  above  named 
of  Borradaile  v.  Hunter  and  Breasted  v.  Farmers'  Loan  and  Trust  Company,  as 
reported  in  4  Hill.  If  it  is  intended  by  it  to  assert  that  the  principle  on  which  a 
contract  made  with  an  insane  jjerson  is  held  to  be  void  as  to  him,  applies  to  this 

1  54  Me.  224. 
668 


CH.  XY.]  SUICIDE.  [§  311 

sentativcs  of  an  insane  suicide  might  recover  upon  the  pol- 
icy, tlie  facts  being  fully  stated  in  the  opinion.  The  policy 
provided  that  in  case  the  insured  should  "die  by  his  own 
hand,  or  in  consequence  of  a  duel,  or  by  the  violation  of 
any  State,  national,  or  provincial  law,  or  by  the  hands  of 
justice,"  it  should  be  void.  The  death  was  by  suicide  in  a 
lit  of  insanity,  and  death  under  such  circumstances  was  held 
not  to  be  within  the  condition.^ 

clause  so  as  to  exclude  from  its  operation  all  cases  of  self-destruction  occasioned 
by  insanity,  it  seems  to  us  that  the  position  is  untenable.  The  reason  for  the 
rule  which  exempts  a  jjcrson  from  liability  on  a  contract  into  which  he  entered 
when  insane  is,  that  he  is  not  deemed  to  have  been  capable  of  giving  an  intelli- 
gent assent  to  its  terms.  But  this  rule  is  not  applicable  where  a  contract  is  made 
with  a  person  in  the  full  possession  of  his  faculties,  and  he  subsequently,  in  a  fit 
of  insanity,  commits  a  breach  of  it,  or  incurs  a  penalty  under  it.  He  is  then 
bound  by  it.  His  mind  and  will  have  assented  to  it.  No  subsequent  mental  in- 
capacity will  absolve  him  from  his  responsibility  on  it,  unless  from  its  nature  it 
implies  the  continued  possession  of  reason  and  judgment  and  the  action  of  an  in- 
telligent will.  A  party  may  be  liable  on  an  unexecuted  contract,  after  he  has 
lost  the  use  of  his  mental  faculties,  as  he  may  be  held  responsible  cu-iliter  for  his 
torts.  Bagster  v.  Portsmouth,  7  Dowl.  &  Ryl.  614;  Weaver  v.  Ward,  Hob.  134  ; 
Cross  V.  Andrews,  Cro.  Eliz.  622.  (12)  To  say  that  insanity  exonerates  a  party 
from  a  forfeiture  under  such  a  proviso  in  a  policy,  is  to  assume  that  this  was  the 
intention  of  the  parties  when  the  contract  of  insurance  was  entered  into.  But  if 
such  was  not  the  intention,  then  it  follows  that  the  assured  gave  an  intelligent 
assent  to  a  contract,  by  which  he  stipulated  that  if  he  took  his  own  life  volunta- 
rily, knowing  the  consequences  of  his  act,  he  would  thereby  work  a  forfeiture  of 
his  claim  under  the  policy,  although  he  may  have  acted  under  the  influence  of 
insanity  in  committing  the  suicidal  act.  So  that,  after  all,  we  are  brought  back 
to  the  inquiry,  what  was  the  intention  of  the  parties  to  the  contract,  in  order  to 
ascertain  the  true  construction  of  the  proviso.  (13)  The  result  to  which  we  have 
come,  after  a  careful  and  deliberate  consideration  of  the  question,  during  which  we 
have  felt  most  sensibly  the  very  great  difficulties  and  embarrassments  wliich  sur- 
round the  subject,  is  that  the  plaintiff's  are  not  entitled  to  recover.  The  facts 
agreed  by  the  parties  concerning  the  mode  in  which  the  plaintiff's'  intestate  took 
his  own  life  leave  no  room  for  doubt  that  self-destruction  was  intended  by  him, 
he  having  sufficient  capacity  at  the  time  to  understand  the  nature  of  the  act  which 
he  was  alaout  to  commit,  and  the  consequences  which  would  result  from  it.  Such 
being  the  fact,  it  is  wholly  immaterial  to  the  present  case  that  he  was  im]ielled 
thereto  by  insanity,  which  impaiied  his  sense  of  moral  responsibility,  and  ren- 
dered him  to  a  certain  extent  irresponsible  for  his  actions." 

1  The  learned  judge,  after  adverting  to  the  diversity  of  judicial  opinions,  both 
in  England  and  in  this  country,  proceeds  as  follows  .  "  In  this  conflict  of  author- 
ity, it  may  not  be  amiss  to  briefly  examine  the  question,  nnd  to  endeavor  to  de- 
termine what  conclusions  will  best  accord  with  the  object  of  the  ]iolicy  and  with 
the  intent  of  the  parties  as  ascertainable  from  the  language  upon  the  recognized 
principles  of  interpretation.  Appleton,  C.-J.,  in  Eastabrook  v.  Union  ^Mut.  Life 
Ins.  Co.,  54  Me.  224;  Kent,  J.,  dissented,  but  delivered  no  opinion.  An  in- 
surance upon  life  is  of  comparatively  recent  date.     A  creditor  may  insure  upon 

669 


§  312]  INSUEANCE  :    FIRE,    LIFE,    ACCIDENT,    ETC.  [CH.  XV. 

§  312.    The  doctrine  laid  down  in  Dean  v,  American  Mut- 

the  life  of  his  debtor,  or  one  may  insure  upon  his  own  life  for  the  benefit  of  his 
family.  In  no  event  can  the  person  upon  whose  life  the  policy  is  effected  be  bene- 
fited by  his  own  death.  Death,  whether  by  disease,  by  accident,  or  the  result 
of  insanity,  is  in  each  case  within  the  general  object  of  the  policy.  The  terms 
'  suicide '  and  '  dying  by  one's  own  hand '  are  generally  used  synonymously.  Some- 
times one  form  of  expression  is  used,  and  sometimes  the  other.  They  have  the 
same  meaning.  Dying  by  one's  own  hand  is  but  another  form  of  expression  for 
suicide.  The  phrase,  'die  by  one's  own  hand,'  may  include  all  cases  of  death  by 
the  person  upon  whose  life  the  policy  is  effected,  or  it  may  receive  limitations. 
If  limitations,  then  the  inquiry  arises  as  to  the  extent  of  those  limitations.  The 
authorities  concur  in  this,  that  the  expression  does  not  embrace  all  cases  of  death 
by  one's  own  hand.  If  the  insured  kill  himself  by  drinking  poison,  not  being 
aware  that  it  was  poison  ;  or  by  snapping  a  loaded  pistol,  ignorant  that  it  was 
loaded;  or  by  leaping  from  a  window  in  the  delirium  of  a  fever,  —  it  is  conceded 
that  he  would  not  die  by  his  own  hand,  within  the  meaning  of  the  clause  under 
consideration,  though  he  might  literally  die  by  his  own  hand,  that  is,  by  his  own 
act.  '  It  is  to  be  observed,'  remarks  Tindal,  C.  J.,  in  Borradaile  v.  Hunter,  'that 
the  words  of  the  proviso  are  the  words  not  of  the  assured,  but  of  the  insurers,  in- 
troduced by  themselves  for  the  purpose  of  their  own  exemption  and  protection 
from  liability  ;  both  in  reason  and  good  sense,  therefore,  no  less  than  upon  the 
acknowledged  principles  of  legal  construction,  they  are  to  be  taken  most  strongly 
against  those  who  speak  the  words,  and  most  favorably  for  the  other  party.  For 
it  is  no  more  than  just  that,  if  the  words  are  ambiguous,  he  whose  meaning  they 
are  intended  to  ex]iress,  and  not  the  other  party,  shall  suffer  by  the  ambiguity.' 
That  they  are  ambiguous  is  conceded,  for  the  courts  in  no  cases  have  given  them 
a  literal  construction.  When  death  is  the  result  of  insanity,  it  is  equally  the  re- 
sult of  disease,  for  which  the  insane  is  in  no  respect  responsible.  It  is  a  well- 
settled  physiological  principle  '  that  disturbed  intelligence  has  the  same  relation 
to  the  brain  that  disordered  respiration  has  to  the  lungs  and  pleura.'  Death, 
then,  by  an  insane  suicide  is  as  much  death  by  disease  as  though  it  were  death  by 
fever  or  consumption.  Death  by  accident  or  mistake,  though  by  the  party's  own 
hand,  is  not  within  the  condition.  Death  by  disease  is  provided  for  by  the  pol- 
icy. Insanity  is  disease.  Death,  the  result  of  insanity,  is  death  by  disease.  The 
insane  suicide  no  more  dies  by  his  own  hand,  than  the  suicide  by  mistake  or  acci- 
dent. If  the  act  be  not  the  act  of  a  responsible  being,  but  is  the  result  of  any 
delusion  or  perversion,  whether  ]ihysical,  intellectual,  or  moral,  it  is  not  the  act 
of  the  man.  '  If  they  [the  insurers]  intended  the  exception  to  extend  both  to  the 
case  of  felonious  self-destruction,  and  self-destruction  not  felonious,  they  ought,' 
observes  Tindal,  C.  J.,  in  Borradaile  v.  Hunter,  '  so  to  have  expressed  it  clearly  in 
the  policy  ;  and  that,  at  all  events,  if  they  have  left  it  doubtful  on  the  face  of  the 
policy  whether  it  is  so  confined  or  not,  that  doubt  ought,  in  my  opinion,  to  be 
determined  against  them  ;  for  it  is  incumbent  on  them  to  bring  themselves  within 
the  exception,  and,  if  their  meaning  remains  in  doubt,  they  have  failed  so  to  do.' 
The  different  English  life  insurance  companies  (when  unwilling  to  incur  the  risk 
of  suicidal  insanity)  have  guarded  against  such  risk  by  language  clearly  excluding 
it  from  the  policy.  Thus,  the  Equitable  has  the  condition,  '  if  the  insured  shall 
die  by  his  own  hand,  being  at  the  same  time  sane  or  insane  ; '  the  Eagle,  '  if  he 
shall  die  by  his  own  act,  whether  sane  or  insane.'  In  the  policies  of  the  Solici- 
tors' and  General  Life  Assurance,  the  condition  is,  if  he  die  by  his  own  act, 
'  whether  felonious  or  not.'  The  policy  in  the  clause  under  consideration  refers 
to  death  bv  his  own  hand,  or  in  consequence  of  a  duel,  or  the  violation  of  any 

670 


CH.  XV.]  SUICIDE.  [§  312 

ual  Life  Insurance  Company,^  has  since  been  adopted  and 

state,  national,   or  provincial  laws,  or  by  the  hands  of  justice.     All  the  other 
cases  after  the  first  involve  criminal  delinquency.     They  involve  intentional  mis- 
doing.    They  assume  criminal  intention.     They  are  cases  where  death  occurs  in 
conseiiuence  of  committing  a  felony  or  other  violation  of  law  on  the  part  of  the 
insured.     There  must  in  all  be  moral,  as  well  as  legal,  responsibility.     Koscitur 
a  sociis  is  a  familiar  maxim  in  the  interpretation  of  covenants.     The  other  mem- 
bers of  the  sentence,  connected  with  the  verb  'die,'  imply  death  as  tlie  result  of 
crime  committed  by  a  responsible  being.     The  first  of  these  conditions,  to  which 
the  others  refer,  and  with  which  they  are  connected,  must  eipially  with  the  others 
refer  to  a  felonious  death,  to  the  case  of  fclo  de  se,  not  to  the  case  of  a  death  with- 
out  legal  or  moral  blame, —  the  result  of  accident,    mistake,  or  disease.     The 
madman  who  in  a  fit  of  delirium   commits  suicide  as  much  dies  by  his  own 
hand  as  does  the  individual  who  accidentally  and  unintentionally  takes  his  own 
life.     They  each  die  by  their  own  hands,   but  without  moral  responsibility  or' 
legal  blame.     One  is  no  more  within  the  conditions  of  the  policy  than  the  other. 
In  each  case  it  should  receive  the  same  construction.     That  a  jury   would  be 
likely  to  regard  suicide  as  proof  of  insanity  does  not  affect  the  conclusion.     If 
suicide  is  to  be  regarded  as  evidentiary  of  insanity,  as  it  unquestionably  is  in 
most  cases,  then  they  generally  arrive  at  correct  results.     If  it  is  not  properly  to 
be  so  regarded,  it  may  be  an  argument  against  a  trial  by  jury,  that  the  tribunal  is 
one  which  allows  itself  to  be  governed  by  its  prejudices  rather  than  by  the  proofs  ; 
but  it  is  none  against  the  construction  of  the  policy  that  death  by  the   hands  of 
the  insured,  whetlier  by  accident,  mistake,  or  in  a  fit  of  insanity,  is  to  be  gov- 
erned by  one  and  the  same  rule.     Nor  does  the  case  of  suicide,  by  one  insane,  fall 
within  the  danger  to  guard  against  the  occurrence  of  which  this  condition  was  in- 
serted.     'A  policy,'  observes  Maule,  J.,  in  Borradaile  v.  Hunter,  'by  which  tho 
sum  is  payable  on  the  death   of  the  person  assured  in  all  events,  gives  him  a 
pecuniary  interest  that  he  should  die  immediately,  rather  than  at  a  future  time, 
to  the  extent  of  the  excess  of  the  value  of  a  present  payment  over  a  deferred  one, 
and  offers  a  temptation  to  self-destruction  to  that  extent.    To  protect  the  insurers 
against  the  increase  of  risk  arising  out  of  this  temptation,  is  the  object  for  which 
the  condition  is  inserted.'     The  reason  here  given  assumes,  or  presupposes,  sanity 
on  the  part  of  the  insured.     It  implies  a  motive  acting  on  a  sane  mind,  for  sanity 
is  in  all  cases  to  be  presumed.     But,  in  fact,  there  is  very  slight  foundation   for 
any  such  reasoning.     The  person  whose  life  is  insured  never  receives  money  after 
his  death.     Suicide  for  the  benefit  of  others  is  rare,  exceptional,  and  Quixotic. 
The  love  of  life,  the  strongest  sentiment  of  our  nature,  affords  reasonable  security 
against  a  danger  so  remotely  probable.     An  insane  man  would  be  little  likely  to 
calculate  the  difference  in  value  between  a  payment  to  be  made  inmicdiately  and 
one  indefinitely  deferred,  and  kill  himself  that  some  one  else  might  receive  tlie 
money  at  an  earlier  date  in  consequence  of  his  committing  suicide.     The  evidence 
affords  not  the  slightest  indication  that  any  such  motive  had  any  influence  in  the 
present  case.     Where  the  policy  is  on  the  life  of  a  mariner,  as  in  the  one  under 
consideration,  'the  insurance  can  be  no  inducement  to  a  criminal  act,  and  may 
be  reasonably  construed  to  cover  this  as  well  as  every  other  risk.  There  is,  indeed, 
no  reason  why  it  should  not  do  so;  for  the  general  tables  of  mortality,  wliich 
form  the  basis  of  the  calculations  upon  which  the  policy  is  founded,  include  this 
as  well  as  every  other  cause  of  death,  so  that  the  particular  risk  is  actually 
insured  against.'"     Bunyon  on  Life  Insurance,  73. 
1  4  Allen  (Mass  ),  96." 

671 


§  313]         insurance:  fire,  life,  accident,  etc.        [ch.  xv. 

followed  by  Mr.  Justice  McKennan  in  the  Circuit  Court  of 
the  United  States  for  the  Western  District  of  Pennsylvania, i 
and  in  Kentucky. ^  In  the  case  from  Kentucky  the  follow- 
ing instructions  were  held  to  be  erroneous:  "That  although 
the  jury  may  be  satisfied  that  Leslie  C.  Graves,  whose  life 
was  insured  by  the  defendant,  committed  suicide,  and  that 
when  he  did  his  intellect  was  unimpaired,  and  that  he  knew 
it  was  forbidden  both  by  moral  and  human  law ;  yet  if  they 
believe,  from  all  the  evidence,  that  at  the  instant  of  the 
commission  of  the  act  his  will  was  subordinated  by  an  un- 
controllable passion  or  emotion,  causing  him  to  do  the  act, 
it  was  an  act  of  moral  insanity,"  and  would  not  avoid  the 
policy.  In  England,  the  rule  laid  down  by  the  majority  of 
the  judges  in  the  cases  of  Borradaile  v.  Hunter  and  Clift  v. 
Schwabe  was  followed  in  White  v.  The  British  Empire  Mut- 
ual Life  Assurance  Company,^  in  which  the  Vice-Chancellor 
(Malins)  took  occasion  to  intimate  that  that  opinion  was  so 
clearly  the  better  law  that  he  did  not  wish  to  hear  any  argu- 
ment on  behalf  of  the  defendants.  In  Stormont  v.  Waterloo 
Life  and  Casualty  Assurance  Company, •*  the  insured  com- 
mitted suicide  by  throwing  himself  out  of  the  window,  and 
the  court  told  the  jury  that  the  question  was,  did  the  assured 
know  that  he  was  throwing  himself  out  of  the  window  ?  If 
he  did,  no  recovery  could  be  had  under  the  policy.  Other- 
wise, if  he  did  not.  Such,  also,  appears  to  be  the  rule  in 
Ohio^  and  in  Maryland.^  It  is  also  said  to  be  the  law  in 
Germany,   Holland,  and  France. ^ 

§  313.  Later  the  Supreme  Court  of  Massachusetts,  having 
occasion  to  reconsider  the  question,^  adhered  to  its  former 
decision,   and  thus  stated  the  position  of  the  question. 

1  Nimick  v.  Mut.  Benefit,  Life  Ins.  Co.,  3  Brewster  (Pa.),  502  ;  s.  c.  Am.  Law 
Leg.  Feb.  1871.  So  also  by  Cadwalladei',  J.,  C.  Ct.  (Pa.)  in  Snyder  v.  Mut.  Life 
Ins.  Co.,  4  Big.  Life  &  Ace.  Ins.  Cas.  424. 

2  St.  Louis  Mut.  Life  Ins.  Co.  v.  Graves,  6  Bush  (Ky.),  268. 

3  38  L.  J.  N.  s.  Ch.  53. 

*  1  F.  &  F.  Nisi  Prius,  22. 

6  Hartmann  v.  Connecticut,  &o.  Ins.  Co.,  4  Ins.  L.  J.  159. 

6  Knickerbocker,  &c.  Ins.  Co.  v.  Peters,  42  Md.  414. 

7  6  Ins.  L.  J.  719. 

8  Cooper  V.  Massachusetts  Mut.  Life  Ins.  Co.,  102  Mass.  227. 

672 


CH.  XV.]  SUICIDE.  [§  313 

"The  proviso  in  the  policy  is,  that  it  shall  be  void  if  the 
assured  'shall  die  by  suicide.'  The  plaintiff  offered  to  prove 
that  the  assured,  at  the  time  of  committing  the  act  of  self- 
destruction,  was  insane ;  that  he  acted  under  the  impulse  of 
insanity;  and  that  his  act  of  self-destruction  was  the  direct 
result  of  his  insanity.  The  question  presented  is,  whether 
if  these  facts  are  true,  the  act  of  self-destruction  avoids  the 
policy,  within  the  terms  of  the  proviso.  The  subject  has 
been  so  fully  discussed  in  the  cases  cited  that  further  argu- 
ment is  needless.     We  need  only  collate  the  cases. 

"In  Borradaile  v.  Hunter^  the  words  were,  'if  the  assured 
should  die  by  his  own  hand. '  He  drowned  himself  in  the 
Thames;  and  the  jury  found  that  he  did  it  voluntarily,  but 
that  he  was  not  capable  of  judging  between  right  and  wi-ong. 
It  was  held  that  the  proviso  was  not  limited  to  acts  of  felo- 
nious suicide,  and  that  the  policy  was  void.  Tindal,  C.  J., 
dissented.  But  the  jury  were  instructed  that  it  must  appear 
that  the  assured  was  conscious  of  the  probable  consequences 
of  his  act,  and  did  it  for  the  express  purpose  of  destroying 
himself  voluntarily,  having  at  the  time  sufficient  mind  and 
will  to  destroy  himself. 

"In  Clift  V.  Schwabe^  the  words  were,  'should  commit 
suicide.'  The  assured  swallowed  a  quantity  of  sulphuric 
acid,  sufficient  to  occasion  death,  for  the  purpose  of  killing 
himself,  of  which  he  died  the  next  day.  It  was  held  by 
Parke  and  Alderson,  BB.,  Patteson,  J.,  and  Rolfe,  B.,  to  be 
immaterial  whether  he  was  a  responsible  agent.  Pollock, 
C.  B.,  and  Wightman,  J.,  dissented.  But  Alderson,  B., 
says  the  words  do  not  apply  to  cases  in  which  the  will  is 
not  exercised  at  all,  as  when  death  results  from  an  accident 
or  delirium,  but  when  the  destruction  is  voluntary,  though 
the  will  may  be  perverted. 

"In  Dean  v.  American  Insurance  Company,^  the  words 
were,  like  those  in  Borradaile  v.  Hunter,  'shall  die  by  his 
own  hand. '  The  assured  cut  his  throat  with  a  razor.  The 
plaintiff,  however,  alleged  and  offered  to  prove  that  the  act 
whereby  the  death  was  caused  was  the  direct  result  of  in- 

1  Man.  &  Gr.  639.  -  3  C.  B.  439.  ^  4  Allen  (Mass.),  96. 

VOL.  I.  — 43  673 


§  313]  INSURANCE  :     FIKE,   LIFE,    ACCIDENT,    ETC.  [CH.  XV. 

sanity ;  that  the  insanity  was  what  is  called  suicidal  depres- 
sion, impelling  him  to  take  his  life,  and  that  suicide  is  the 
necessary  and  direct  result  of  such  insanity  or  disease ;  and 
it  was  held  that  this  avoided  the  policy.  But  Bigelow,  C. 
J.,  in  giving  the  opinion,  adverts  to  the  word  'suicide,'  and 
avoids  discussing  its  signification;  thereby  leaving  the  pres- 
ent case  undecided  by  this  court.  But  he  says  that  if  the 
death  is  caused  in  the  madness  of  delirium,  or  under  any 
combination  of  circumstances  from  which  it  may  be  fairly 
inferred  that  the  act  of  self-destruction  was  not  the  result 
of  the  will  and  intention  of  the  party,  adapting  the  means  to 
the  end,  and  contemplating  the  physical  nature  and  effects 
of  the  act,  it  would  not  be  within  the  policy.  This  limita- 
tion is,  in  substance,  the  same  with  that  which  is  quoted 
from  the  other  cases  cited. 

"In  Eastabrook  V.  Union  Insurance  Company,^  the  words 
were  'shall  die  by  his  own  hand.'  The  jury  found  that  the 
self-destruction  was  the  result  of  a  blind  and  irresistible 
impulse  over  which  the  will  had  no  control,  and  was  not  an 
act  of  volition.  It  was  held  that  this  did  not  avoid  the  pol- 
icy;  and  Appleton,  C.  J.,  in  a  very  elaborate  opinion,  says 
the  decision  was  in  entire  conformity  with  the  law  as  stated 
in  Dean  v.  American  Insurance  Company,  referring  to  the 
limitation  stated  above.     But  Kent,  J.,   dissented. 

"In  Breasted  V.  Farmers'  Loan  and  Trust  Company,^  the 
words  were  'should  die  by  his  own  hand.'  It  was  held  by 
a  majority  of  the  Court  of  Appeals,  three  of  the  justices  dis- 
senting, that,  if  the  assured  was  insane,  and  incapable  of 
discerning  between  right  and  wrong,  his  suicide  did  not 
avoid  the  policy.  This  decision  is  at  variance  with  the 
other  authorities  cited,  and  is  contrary  to  our  own  interpre- 
tation of  the  same  words  in  Dean  v.  American  Insurance 
Company. 

"  Upon  a  careful  consideration  of  the  elaborate  discussion 
of  the  matter  in  the  cases  above  cited,  by  the  dissenting 
judges  as  well  as  by  those  in  the  majority,  we  think  that,  as 
applied  to  this  case,  there  is  no  substantial  difference  of  sig- 

1  54  Me.  224.  2  4  geld.  (N.  Y.)  299. 

674 


CH.  XV.]  SUICIDE.  [§316 

nification  between  the  phrases  'shall  die  by  his  own  hand,' 
'shall  commit  suicide,'  and  'shall  die  by  suicide;'  and  that 
they  include  self-destruction  under  the  influence  of  insanity 
within  the  limitation  above  stated.  In  the  present  case, 
there  was  no  otfer  to  prove  madness  of  delirium,  or  that  the 
act  of  self-destruction  was  not  the  result  of  the  will  and  in- 
tention of  the  party,  adapting  the  means  to  the  end,  and  con- 
templating the  physical  nature  and  effects  of  the  act.  The 
insanity  therefore  was  not  such  as  to  take  the  case  out  of 
the  proviso." 

§  314.  In  Fowler  v.  Mutual  Life  Insurance  Company,^  the 
facts  made  it  so  plain  that  the  insured  was  a  voluntary  sui- 
cide, that  the  court  refused  to  submit  the  question  whether 
the  act  was  an  insane  or  an  involuntary  one  to  the  jury, 
after  intimating  that  the  question  would  be,  if  there  were 
any  question  on  the  evidence,  whether  the  act  was  volun- 
tarily done,  without  reference  to  the  question  whether  the 
insured  was,   or  was  not,   a  responsible  moral  agent. 

§  315.  In  Mallory  v.  Travelers'  Insurance  Company,^  the 
court  instructed  the  jury  that  if  the  condition  of  the  deceased 
at  the  time  of  death  was  such  that  he  could  not  distinguish 
between  right  and  wrong,  if  it  was  such  that  he  did  not 
know  that  he  was  doing  an  act  which  would  produce  death, 
the  plaintiff  might  recover, — a  rule  indicating  a  tendency 
to  adopt  the  doctrine  of  the  Massachusetts  cases,  and  said, 
on  appeal  to  the  general  term  of  the  same  court,  to  have 
been  an  instruction  quite  as  favorable  to  the  defendants  as 
the  rule  in  New  York  would  allow. 

§  316.  In  the  case  of  Van  Zandt  v.  Mutual  Benefit  Life 
Insurance  Company, ^  in  New  York,  the  court  adheres  to  the 
rule  theretofore  laid  down  in  that  State  that  the  suicide  must 
be  felonious,  and  by  one  who  was  able  to  appreciate  the 
moral  effect  and  consequences  of  his  act,  in  order  to  prevent 
a  recovery,   and   distinctly  refused  to  sustain  the   doctrine 

1  4  Lans.  (N.  Y. )  202. 

2  N.  Y.  Sup.  Ct.  1870  ;  s.  c.  47  N.  Y.  52,  where,  however,  this  niliiip;,  it  not 
ha%'in,£;  Vieen  excepted  to,  was  not  considered. 

3  New  York  Supreme  Court,  Gen.  Term,  4th  Dept.,  June,  1872. 

675 


§  316]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.  [cil.  XV. 

that  if  the  insured  destroy  his  own  life  voluntarily  and  wil- 
fully, having  at  the  time  sufficient  power  of  mind  and  reason 
to  understand  the  physical  nature  and  consequences  of  such 
an  act,  and  having  the  purpose  and  intention  to  cause  death 
by  the  act,  he  cannot  recover.  And  it  was  also  held  in  the 
same  case  that  there  was  no  essential  difference  whether  the 
provision  was  "  in  case  he  shall  die  by  his  own  hand,  in  or 
in  consequence  of  a  duel,  or  by  reason  of  intemperance,"  or 
"in  case  he  shall  die  by  his  own  hand  in  consequence  of  a 
duel,"  &c.  1     In  a  still  later  case  the  same  court  held  that  an 

1  On  appeal,  the  court,  after  explaining  tliat  Breasted's  case  is  not  opposed  to 
Borradaile  v.  Hunter,  used  the  following  language:  (1)  "It  is  contended  that 
the  case  of  Breasted  v.  The  Farmers'  Loan  and  Trust  Company,  4  Hill,  73,  and 
8  N.  Y.  299  ;  1  Big.  Life  &  Ace.  Ins.  Cas.  341,  343,  establishes  a  different  doctrine 
in  tins  State.  In  4  Hill,  73,  the  case  came  before  the  court  on  demurrer  to  a  re- 
plication, which  averred  that  when  the  assured  drowned  himself  he  was  of  un- 
sound mind,  and  wholly  unconscious  of  the  act.  Nelson,  C.  J.,  in  delivering  the 
opinion  of  the  court,  placed  the  decision  upon  the  ground  that,  speaking  legally, 
such  drowning  was  no  more  the  act  of  the  assured  than  if  he  had  been  impelled 
by  irresistible  physical  power.  The  learned  judge  also  intimates  that  the  connec- 
tion in  which  the  words  stand  in  the  policy  would  seem  to  indicate  that  they 
were  intended  to  express  a  criminal  act  of  self-destruction,  as  they  are  found  in 
conjunction  with  the  provisions  relating  to  the  termination  of  the  life  of  the 
insured  in  a  duel,  or  his  execution  as  a  criminal.  But  he  does  not  place  the  deci- 
sion on  that  ground,  nor  could  it  well  stand  tliere  if  the  language  of  the  policy 
in  that  case  was  the  same  as  in  the  present,  because  in  this  policy  the  provisions 
in  conjunction  with  which  the  words  are  used  relate  as  well  to  acts  not  criminal 
as  to  criminal  acts  ;  the  same  sentence  embracing  the  visiting  of  prohibited  teni- 
tories,  engaging  in  service  upon  the  seas,  or  in  military  service,  death  from  intem- 
perance, &c.  The  maxim  noscitur  a  sociis  cannot,  therefore,  afford  a  reliable  rule 
of  interpretation.  See  ojiinion  of  Grover,  J.,  in  Bradley  v.  Mutual  Benefit  Life 
Insurance  Company.  45  N.  Y.  434;  2  Big.  Life  &  Ace.  Ins.  Cas.  117.  In 
8  N.  Y.  299,  the  case  of  Breasted  came  before  the  Court  of  Appeals  on  appeal 
from  the  decision  of  the  Supreme  Court  upon  the  demurrer,  and  also  upon  a  judg- 
ment on  the  report  of  the  referee  on  issues  of  facts  which  had  been  joined  in  the 
action.  The  referee  had  found  that  the  assured  threw  himself  into  the  river  while 
insane,  for  the  purpose  of  drowning  himself,  not  being  mentally  capable  at  the 
time  of  distinguishing  between  right  and  wrong.  There  was  no  finding  that  the 
act  was  voluntary  or  wilful.  Such  a  finding  would  have  established  that  the  man 
was  not  deprived  of  his  power  of  will,  and  that  he  could  have  restrained  himself 
from  the  commission  of  the  act,  and  would  have  negatived  any  insane  impulse 
which  he  could  not  resist.  Bearing  in  mind  the  well-established  principles  upon 
which  judgments  based  upon  findings  of  fact  by  a  court  or  referee  are  reviewed  in 
this  appellate  tribunal,  and  that  in  regard  to  matters  of  fact  all  intendments  of 
•which  the  evidence  in  the  case,  or  the  findings,  are  fairly  susceptible,  must  be  in 
suppoi't  of  such  judgments,  and  that  the  finding  in  general  terms  of  insanity  may 
have  comprehended  a  deprivation,  not  merely  of  moral  sense,  but  of  any  rational 
will,  the  court  could  hardly  have  come  to  any  other  conclusion  than  it  did.     The 

676 


CH.  XV.]  SUICIDE.  [§  316 

act  done  under  the  control  of  an  insane  impulse  caused  by 

whole  reasoning  of  the  opinion  of  Willard,  J.,  which  prevailed  over  the  dissents 
of  Gardner,  Jewett,  and  Johnson,  J  J.,  shows  that  he  regarded  the  point   raised 
upon  the  demurrer,  viz.  that  the  assured  at  the  time  of  destroying  his  own   life 
was  of  unsound  mind  and  wholly  unconscious  of  the  act,  and  that  presented  by 
the  finding,  as  identical,  and  that  the  learned  judge  regardeil  the  finding  as  es- 
tablishing that  the  insured  was  so  insane  as  not  to  be  capable  of  forming  an  inten- 
tion, and  that  he  had  not  sufficient  mind  to  concur  in  the  act.     The  learned 
judge  does  not  undertake  to  overrule  the  cases  of  Borradaile  v.  Hunter  and  Clift 
V.  Schwabe,  but  expressly  distinguishes  those  cases  from  the  one  before  him  by 
pointing  out  that  they  assumed  that  the  act  was  voluntary,  which  fact  he  holds 
that  the  finding  in  the  case  of  Breasted  failed  to  establish.     A  finding,  in  the 
language  of  the  request  in  the  present  case,  that  the  deceased  had  sufficient  power 
of  mind  and  reason  to  understand  the  i>hysical  nature  and  consequences  of  the 
act,  and  that  he  committed  it  voluntarily  and  wilfully,  and  in  pursuance  of  a  pur- 
pose and  intention  thereby  to  cause  his  own  death,  would  have  established  that 
insanity  did  not  exist  to  such  a  degree  as  to  prevent  him  from  forming  an  inten- 
tion, or  being  conscious  of  the  act  he  was  doing.     It  would  have  established  that 
his  mind  did  concur  with  the  act,  and  that  this,  being  voluntary,  was  not  the 
result  of  any  insane  impulse  or  want  of  power  of  self-control.     Wliether  so  much 
power  of  reasoning  and  of  self-control  could  be  left  in  a  mind  so  impah-ed  as  to  be 
incapable  of  appreciating  the  moral  obliquity  of  the  crime  of  suicide,  is  rather  a 
scientific  than  a  legal  question.    (2)  Judge  Willard,  in  the  Breasted  case,  8  N.  Y. 
299,  305,  expresses  the  opinion  that  a  man  so  insane  as  to  be  incapable  of  dis- 
cerning between  right  and  wrong  can  form  no  intention.    This,  it  must  be  observed 
in  passing,  is  a  much  broader  proposition  than  that  the  fiiilure  to   appreciate  the 
wrong  of  a  particular  act  evinces  a  total  dei)rivation  of  reason.     The  loss  of  moral 
sense,  even  to  that  extent,  in  one  who  had  previously  possessed  it,  would  un- 
doubtedly be  a  fact  bearing  strongly  upon  the  question  whether  he  retained  his 
other  faculties.     But  in  the  practical  administration  of  justice  in   cases  of  this 
description,  it  seems  to  us  a  dangerous  doctrine  to  hold  that  the  attention  of  the 
jury  should  be  directed  principally  to  the  degree  of  appreciation  whicli  the  de- 
ceased had  of  the  moral  nature  of  his  act,  and  that  this  question,  most  specula- 
tive and  difficult  of  solution,  should  be  made  the  test  by  which  it  should  be 
determined  whether  he  had  knowingly  and  voluntarily  violated  the  condition  of 
his  insurance.     The  real  question  is,  whether  he  did  the  act  consciously  and  volun- 
tarily, or  whether  from  disease  his  mind  had  ceased  to  control  his  actions.     Sup- 
posing a  man  to  be  in  possession  of  his  will  and  of  the  ordinary  mental  faculties 
necessary  for  self-preservation,  but  that  his  mind  has  become  so  morbidly  diseased 
on  the  subject  of  suicide  that  he  cannot  appreciate  its  moral  wrong,  and  in  this 
condition  of  mind  he  takes  his  own  life  voluntarily  and  intentionally,  perha[)S 
with  the  veiy  object  of  securing  to  his  family  the  benefits  of  an  insurance  upon 
his  life,  it  is  difficult  to  say  that  this  is  not  a  death  by  his  own  liaml  within  the 
meaning  of  the  policy.     It  has  been  doubted  whether  public  policy  would  permit 
an  insurance  covering  the  case  of  intentional  suicide  by  the  assured  while  sane. 
But  however  this  may  be,  no  rational  doubt  can  be  entertained  that  a  condition 
exempting  the  insurers  from  liability  in  case  of  the  death  of  the  assureil  by  bis 
own  hand,  whether  sane  or  insane,  would  be  valid  if  mutually  agreed  u]X)n  be- 
tween  the   insurer  and  the  insured.     When   nothing  is  said  in  th(^  policy  with 
respect  to  insanity,  the  words  '  die  by  bis  own  hand  '  in  their  literal  sense  com- 
prehend all  cases  of  self-destruction.     The  exceptions  which  have  been  engrafted 

677 


§316]  insurance:    fire,  life,  accident,  etc.      [ch.  XV. 

disease  and  derangement  of  the  intellect,  and  deprivation  of 

upon  these  words  by  judicial  decisions  must  rest  upon  the  ground  that  the  ex- 
cepted cases  could  not  have  been  within  the  meaning  of  the  parties  to  the  policy. 
The  intent  on  the  part  of  the  insurer  in  inserting  the  condition  is  evident.     The 
policy  creates  in  the  assured  a  pecuniary  interest  in  his  own  death.     To  a  man 
laboring  under  the   pressure  of  poverty  and   the  urgent  wants  of  a  dependent 
family,  or  of  inability  to  ilischarge  sacred  pecuniary  obligations  or  other  similar 
causes,  the  policy  oti'ers  a  temptation  to  self-destruction.     To  protect  the  insurers 
against  the  increase  of  risk  arising  out  of  this  temptation  is  the  object  for  which 
the  condition  in  question  is  inserted.     Per  Maule,  J.,  5  M.  &.  Gr.  653.     The  con- 
dition ought,  therefore,  to  be  so  construed  as  to  exclude  only  those  cases  in  which 
these  motives  could  not  have  operated,  such  as  accident  or  delirium.     Ibid.     So 
far  as  considerations  of  public  policy  have  any  place  in  determining  such  a  ques- 
tion, they  are  undoubtedly  in  favor  of  confining  the  exceptions  to  the  condition  to 
cases  in  which  the  self-destruction  is  clearly  shown  to  have  been  accidental  or 
involuntary.     (3)    I  do  not  find  that  any  of  the  cases  have  gone  so  far  as  to  ad- 
judicate that  a  mere  want  of  capacity  to  appreciate  the  moral  wrong  involved  in 
the  act,  when  it  was  voluntary  and  intentional,  unaccompanied  by  any  want  of 
appreciation  of  its  physical  nature  and  consequences,  or  by  any  insane  impulse,  or 
want  of  power  of  will  or  self-control,  is  sufficient  to  take  a  case  out  of  the  proviso. 
(4)   The  contrary  has  been  held  in  several  cases,  and  the  doctrine  of  Borradaile  v. 
Hunter  adopted.     Dean  v.  The  American  Mut.  Life  Ins.  Co.,  4  Allen,  96 ;  1  Big. 
Life  &  Ace.  Ins.  Cas.  195;    Cooper  v.  The  Massachusetts  Mutual  Life   Ins.  Co., 
102  Mass.  227  ;    1  Big.  Life  &  Ace.  Ins.  Cas.  758  ;    Nimick  v.  Insurance  Co.,  10 
Am.  Law  Reg.  N.  s.  101,  102;  1  Big.  Life  &  Ace.   Ins.  Cas.  689;    Gay  v.  Union 
Mutual  Life  Ins.  Co.,  9  Blatchf.  142;  2  Big.  Life  &  Ace.  Ins.  Cas.  4;  Wharton  & 
Stille,  Med.  Jur.  §  240  ;    Fowler  v.  The  Mutual  Life  Ins.  Co.  of  N.  Y.,  4  Lans. 
202  ;  3  Big.  Life  k,  Ace.  Ins.  Cas.  673.     In  the  case  of  St.  Louis  Mutual  Insurance 
Company";;.  Graves,  6   Bush   (Ky.),  268;    1   Big.  Life  &  Ace.  Ins.  Cas.  736,  the 
Court  of  Appeals  of  Kentucky  was  eijually  divided.      (5)  The  only  ca.se  cited  in 
support  of  the  respondents'  view,  in  addition  to  the  case  of  Breasted  v.  The  Farm- 
ers' Loan  and  Trust  Company,  which  has  already  been  commented  upon,  is  the 
case  of  The  Mutual  Life  Insurance  Company  v.  Terry,  15  Wall.  580  ;    3  Big. 
Life  &  Ace.  Ins.  Cas.  819.     But  it  will  be  found  upon  an  examination  of  that  case 
that  the  question  of  the  capacity  of  the  deceased  to  appreciate  the  moral  character 
of  the  act  was  not  involved,  and  that  all  that  is  said  upon  that  subject  in  the 
opinion  is  obiter.     The  judge  at  the  trial  expressly  in.structed  the  jury  that  it  was 
not  every  degree  of  insanity  which  would  so  far  excuse  the  party  taking  his  own 
life  as  to  make  the  party  insuring  liable  ;  but  that  the  mind  of  the  deceased  must 
have  been  so  far  deranged  as  to  have  made  him  incapable  of  using  a  rational  judg- 
ment in  regard  to  the  act  he  was  committing,  or  he  must  have  been  impelled  by 
some  insane  impulse  which  the  reason  that  was  left  him  did  not  enable  him  to 
resist      Not  a  word  was  said  to  the  jury  in  respect  to  his  consciousness  of  the 
moral  quality  of  the  act.     1  Dill.  C.  C.  R.  404.     The  requests  to  charge  whicli 
were  refused  required  the  submission  to  the  jury  only  of  the  «|uestion  of  the 
capacity  of  the  deceased  to  understand  the  nature  and  consequences  of  the  act, 
and  did  not  require  them  to  find  that  it  was  voluntary,  and  therefore  did  not 
exclude  the  hypothesis  of  an  insane  impulse  which  he  could  not  resist.      (6)  The 
questions  raised  by  the  exemptions  in  that  case  differ  widely  from  the  present, 
and  the  judgment  therein  is  not  inconsistent  with  the  doctrine  of  Borradaile  v. 
Hunter,  and  the  other  cases  cited.     The  opinion  delivered  in  the  Supreme  Court 
678 


CH.  XV.]  SUICIDE.  [§  31" 

the  capacity  of  governing  the  conduct  in  accordance  with 
reason,  could  not  be  regarded  as  voluntary,  or  within  the 
proviso  against  self-destruction. ^ 

§  317.    In  Isett  v.  American  Life  Insurance  Company,   the 
insuredcommitted  suicide  by  shooting  himself  with  a  pistol, 
and  the  policy  provided  that  if  the  insured  "die  by  his  own 
hand"  the  insurer  should  not  be  liable.     The  jury  were  in- 
structed that  if  the  insured  at  the  time  of  his  death  was 
conscious  that  his  death  would  follow  the  discharge  of  the 
pistol  in  his  hands,  though  he  was  laboring  under  mental 
depression  or  disturbance  of  mind,  or  if  he  destroyed  his 
life  because  he  was  suffering  from  some  physical  infirmity, 
and  for  the  purpose  of  escaping  from  such  infirmity,  there 
could  be  no  recovery;  that  sanity  was  to  be  presumed  and 
insanity  to  be  proved  by  the  party  alleging  it,  and  that  sui- 
cide is  not  of  itself  proof  of  insanity,  but  to  be  considered 
with  other  facts  and  circumstances  in  the  case.^     On  appeal, 
the  Supreme  Court  say:  "  We  understand  the  fair  import  o 
the  instruction  to  be  this:  if  the  insured  possessed  sufficient 

in  the  Terry  case  contains  the  same  general  language,  which  goes  far  beyon.l  the 
chari  in  the  Circuit  Court,  and  was  not  necessary  to  sustain  the  judgment      I 

etr  to  that  part  of  the  opinion  which  is  relied  upon  in  the  points  of  -Respond- 
ent in  tHseaL,  and  in  which  the  learned  judge  says  that  '  if  the  death  is  cans  d 
Ty  thevXtayactof  the  assured,  he  knowing  and  intending  that  his  death 
sha  1  be  the  result  of  his  act,  but  when  his  reasoning  faculties  are  so  far  impai.ed 

la^e  is  not  ab le  to  understand  the  moral  character,  the  general  nature,  conse- 
that  he  IS  not  ai  le  ^^  ^^.^^^^^   j^^  ^^  impelled 

tZXt  i  "HX..';^  te  h..  no.  the  power  to  resist,'  the  insurers 
Uable.     h  The  precise  effeet  of  this  passage  is  "»«  ^T  "^   °  ;;:j  "at  A     a 

::^s^":;ft;';rta^.»;t^x;:inr^l^„x.hc■,gh  the  as. 

deceased  we  e  so  impaired  that  he  was  not  able  to  understand  the  general  nature 
deceased  ^^ele  so  imp  commit,' or  when  he  was 

r»^::rf  M^t^lTileSt'ii^^^^^^^^  ,  ,„, , ,,  „, 

.  Court  of  Common  Pleas,  Blair  County,  I';"-'  fY'  f^  p,  )    7  L^  ^- 
3  See  also  Stratton  v.  North  American,  &c.  Ins.  Co.  (C.  C.  P.  Pa.),  7  l..^-  ^ 
313  ;  s.  c.  5  Big.  Life  &  Ace.  Ins.  Cas.  504.  ^^^ 


§  318]  INSURANCE :    FIRE,    LIFE,   ACCIDENT,   ETC.         [CH.  XV. 

mental  capacity  to  form  an  intelligent  intent  to  take  his 
own  life,  and  was  conscious  that  the  act  he  was  about  to 
commit  would  effect  that  object,  it  avoided  the  policy.  If, 
however,  his  mind  was  so  far  impaired  that  he  was  incap- 
able of  forming  such  an  intent,  and  was  unconscious  of  the 
effect  of  his  action  upon  his  life,  a  recovery  could  be 
had.  So  understanding  it,  we  cannot  say  there  is  any  error 
therein."  The  court  further  observe  that  the  cases  of  Hart- 
man  V.  Keystone  Insurance  Company  ^  is  not  in  conflict  with 
the  instruction,  and  as  the  question  based  upon  the  distinc- 
tion between  a  perception  of  the  physical  and  moral  char- 
acter of  acts  does  not  arise,  they  decline  to  go  into  that 
question. 2  In  a  subsequent  case  in  the  Common  Pleas,  sui- 
cide being  defined  as  malicious  self-murder,  the  rule  was 
stated  as  follows :  "  If  the  insured  was  impelled  to  the  act 
by  an  insane  impulse,  which  the  reason  which  was  left  in 
him  did  not  enable  him  to  resist,  or  if  his  reasoning  powers 
were  so  far  overthrown  by  his  mental  condition  that  he  could 
not  exercise  his  reasoning  faculties  on  the  act  he  was  about 
to  do,  he  did  not  die  by  his  own  hand."^  And  in  a  still 
later  case  the  court,  while  admitting  that  the  "preponder- 
ance of  decisions"  is  in  favor  of  the  English  doctrine,  ex- 
press their  preference  for  the  doctrine  of  Terry's  case.* 
Suicide  implies  self-destruction  by  a  person  of  sound  mind.^ 
§  318.  In  Gay  v.  Union  Mutual  Life  Insurance  Company, 
tried  before  Woodruff  and  Shipman,  JJ.,^  where  the  insured 
shot  himself  in  the  head  with  a  pistol,  the  jury  were  charged 
that  if  the  insured  at  the  time  he  fired  the  pistol  was  con- 
scious of  the  act  he  was  committing,  intended  to  take  his 
own  life,  and  was  capable  of  understanding  the  nature  and 
consequences  of  the  act,  the  insurers  were  not  liable;  that 

1  21  Pa.  St.  466  ;  post,  §  323.  ^  74  Pa.  St.  176. 

3  Bank  of  Oil  City  v.  Guardian,  &c.  Ins.  Co.,  4  Ins.  L.  J.  472. 

*  Connecticut,  &c.  Ins.  Co.  v.  Groom,  86  Pa.  St.  92. 

6  Ibid.  See  also  remarks  of  Bigelow,  C.  J.,  ante,  §  310  ;  and  Phadenhauer  v. 
Germania  Ins.  Co.,  7  Heisk.  (Teim.)  567,  where  the  policy  used  the  words  "by 
suicide  or  by  his  own  hands."  See  also  Bigelow  v.  Berkshire  Life  Ins.  Co.,  93 
U.  S.  284. 

6  9Blatchf.  C.  Ct.  (U.S.)  142. 

680 


CH.  XV.]  SUICIDE.  [§  320 

if  the  act  was  thus  committed,  it  was  immaterial  whether 
he  was  capable  of  understanding  its  moral  aspects,  or  of 
distinguishing  between  right  and  wrong;  and  that  if  he  was 
not  thus  conscious,  or  had  no  such  capacity,  but  acted  under 
an  insane  delusion  overpowering  his  understanding  and  will, 
or  was  impelled  by  an  uncontrollable  impulse  which  neither  his 
understanding  nor  will  could  resist,  the  insurers  were  liable. 

§  319.  In  Terry  v.  Life  Insurance  Company,^  Mr.  Justice 
Miller  ruled  that  there  is  no  presumption  of  law  that  self- 
destruction  is  caused  by  insanity,  and  stated  the  conclusions 
at  which  he  had  arrived  as  the  result  of  an  examination  of 
the  authorities,  in  his  charge  to  the  jury. 

§  320.  The  doctrine  of  this  case  was  affirmed  on  appeal  to 
the  Supreme  Court  of  the  United  States, ^  Mr.  Justice  Hunt 
delivering  the  opinion  of  the  court. 

1  1  Dill.  C.  Ct.  (U.  S.)  8th  Circuit,  403.  The  judge  said:  "It  being  agreed 
that  the  deceased  destroyed  his  life  by  taking  poison,  it  is  claimed  by  the  de- 
fendants that  he  '  died  by  his  own  hand,'  within  the  meaning  of  the  policy,  and 
that  they  are  therefore  not  liable.  This  is  so  far  true,  that  it  devolves  on  the 
plaintiff  to  prove  such  insanity  on  the  part  of  the  deceased,  existing  at  the  time 
he  took  the  poison,  as  will  relieve  the  act  of  taking  his  own  life  from  the  effect 
which,  by  the  general  terms  used  in  the  policy,  self-destruction  was  to  have, 
namely,  to  avoid  the  policy.  It  is  not  every  kind  or  degree  of  insanity  which 
will  so  far  excuse  the  party  taking  his  own  life  as  to  make  the  company  insuring 
liable.  To  do  this,  the  act  of  self-destruction  must  have  been  the  consequence  of 
insanity,  and  the  mind  of  the  deceased  must  have  been  so  far  deranged  as  to  have 
made  him  incajiable  of  using  a  rational  judgment  in  regard  to  the  act  which  he 
was  committing.  If  he  was  impelled  to  the  act  by  an  insane  impulse,  which  the 
reason  which  was  left  him  did  not  enable  him  to  resist,  or  if  his  reasoning  powers 
were  so  far  overthrown  by  his  mental  condition  that  he  could  not  exercise  his 
reasoning  faculties  on  the  act  he  was  about  to  do,  then  the  company  was  liable. 
On  the  other  hand,  there  is  no  presumption  of  law,  prima  facie  or  otherwise,  that 
self-destruction  arises  from  insanity  ;  and  if  you  believe,  from  the  evidence,  that 
the  deceased,  although  excited  or  angry,  or  distressed  in  mind,  formed  the  deter- 
mination to  take  his  own  life,  because  in  the  exercise  of  his  usual  reasoning  facul- 
ties he  preferred  death  to  life,  then  the  company  is  not  liable,  because  he  died  by 
his  own  hand  within  the  meaning  of  the  policy." 

2  Mut.  Life  Ins.  Co.  v.  Terry,  15  Wall.  (if.  S. )  580.  The  judge  here  says  : 
"This  action  was  brought  to  recover  the  sum  of  two  thousand  dollars,  claimed  to 
be  due  upon  a  policy  of  insurance  on  the  life  of  George  Terry,  made  and  issued  to 
the  plaintiff,  his  wife.  The  policy  contained  a  condition,  of  which  a  portion  was 
in  the  following  words,  viz.  :  '  If  the  said  person  whose  life  is  hereby  insured 
.  .  .  shall  die  by  his  own  hand,  .  .  .  this  policy  shall  be  null  and  void.'  "Within 
the  terms  of  the  policy  George  Terry  died  from  the  effects  of  poison  taken  by  him. 
Evidence  was  given  tending  to  show  that  at  the  time  he  took  the  poison  he  wa.s 
insane.     Evidence  was  also  given,  tending  to  show  that  at  that  time  he  was  sane, 

681 


§  321]  insurance:   fire,  life,  accident,  etc.      [CH.  XV. 

§  321.    Mistake ;  Accident.  —  111  the  Equitable  Life  Assur- 

aiid  capable  of  knowing  the  consequences  of  the  act  he  was  about  to  commit. 
Thereupon  the  counsel  for  the  defendant  asked  the  court  to  instruct  the  jury, 
1.  If  the  jury  believe,  from  the  evidence  in  the  case,  that  the  said  George  Terry 
destroyed  his  own  life,  and  that,  at  the  time  of  self-destruction,  he  had  sufficient 
capacity  to  understand  the  nature  of  the  act  which  he  was  about  to  commit,  and 
the  conse(iueni;es  which  would  result  from  it,  then,  and  in  that  case,  the  plaintift" 
cannot  recover  on  the  policy  declared  on  in  this  case.  2.  That  if  the  jury  believe 
from  the  evidence  that  the  self-destruction  of  the  said  George  Terry  was  intended 
by  him,  he  having  sufficient  capacity  at  the  time  to  understand  the  nature  of  the 
act  which  he  was  about  to  commit,  and  the  consequences  which  would  result 
from  it,  then,  and  in  that  case,  it  is  wholly  immaterial  in  the  present  case  that 
be  was  impelled  thereto  by  insanity,  which  impaired  his  sense  of  moral  responsi- 
bility, and  rendered  him,  to  a  certain  extent,  irresponsible  for  his  action.  Which 
instructions,  and  each  one  of  said  instructions,  the  couit  refused  to  give  to  the 
jury,  but  the  court  did  charge  the  jury  as  follows.  [See  preceding  section.]  .  .  . 
The  re(iuest  proceeds  upon  the  theory  that  if  the  deceased  had  sufficient  mental 
capacity  to  understand  the  nature  and  conseciuence  of  his  act,  —  that  is,  that  he  was 
about  to  take  poison,  and  that  his  death  would  be  the  result,  —  he  was  responsible 
for  his  conduct,  and  the  defendant  is  not  liable  ;  and  the  fact  that  his  sense  of 
moral  responsibility  was  imjjaired  by  insanity  does  not  affect  the  case.  The  charge 
l)roceeds  upon  the  theory  that  a  higher  degree  of  mental  and  moral  power  must 
exist  ;  that  although  the  deceased  had  the  capacity  to  know  that  he  was  about  to 
take  poison,  and  that  his  death  would  be  the  result,  yet  if  his  reasoning  powers 
were  so  far  gone  that  he  could  not  exercise  them  on  the  act  he  was  about  to  com- 
mit, its  nature  and  effect,  or  if  he  was  impelled  by  an  insane  impulse  which  his 
impaired  capacity  did  not  enable  him  to  resist,  he  was  not  responsible  for  his 
conduct,  and  the  defendant  is  liable.  It  may  not  be  amiss  to  notice  that  the  case 
does  not  present  the  point  of  what  is  called  emotional  insanity,  or  mania  tran- 
sitoria ;  that  is,  the  case  of  one  in  possession  of  his  ordinary  reasoning  faculties, 
who  allows  his  passions  to  convert  him  into  a  temporary  maniac,  and  while  in 
this  condition  commits  the  act  in  question.  This  case  is  expressly  excluded  by 
the  last  clause  of  the  charge,  in  which  it  is  said  that  anger,  distress,  or  excitement 
does  not  bring  the  case  within  the  rule  if  the  insured  possesses  his  ordinary 
reasoning  faculties.  The  case  of  Borradaile  y.  Hunter,  [5  Man.  &  Gr.  639],  is  cited 
by  the  insurance  company.  The  case  is  found  also  in  2  Bigelow's  Life  and  Acci- 
dent Insurance  Cases,  p.  280,  and  in  a  note  appended  are  found  the  most  of  the 
cases  upon  the  subject  before  us.  The  jury  found  in  that  case  that  the  deceased 
voluntarily  took  his  own  life,  and  intended  so  to  do,  but  at  the  time  of  commit- 
ting the  act  he  was  not  capable  of  judging  between  right  and  wrong.  Judgment 
went  for  the  defendant,  which  was  sustained  upon  appeal  to  the  full  bench.  The 
counsel  for  the  company  argued  that  where  the  act  causing  death  was  intentional 
on  the  part  of  the  deceased,  the  fact  that  his  mind  was  so  far  impaired  that  he 
was  incapable  of  judging  between  right  and  wrong  did  not  prevent  the  proviso 
from  attaching  ;  that  moral  or  legal  responsibility  was  irrelevant  to  the  issue. 
The  court  adds  :  '  It  may  very  well  be  conceded  that  the  case  would  not  have 
fallen  within  the  meaning  of  the  condition  had  the  death  of  the  assured  resulted 
from  an  act  committed  under  the  influence  of  delirium,  or  if  he  had  in  a  paroxysm 
of  fever  precipitated  himself  from  a  window,  or,  having  been  bled,  removed  the 
bandages,  and  death,  in  either  case,  had  ensued.  In  these  and  many  other  cases 
that  might  be  put,  though,  strictly  speaking,  the  assured  may  be  said  to  have 

682 


CH.  XV.]  SUICIDE.  [§  321 

ance  Society  v.  Paterson,^  the  insured  had  taken  laudanum 

died  by  his  own  hands,  the  circumstances  clearly  would  not  be  such  as  the  parties 
conteuii)lated  when  the  contract  was  entered  into.'  In  delivering  the  opinion  of 
the  court,  Erskine,  J.,  says  all  that  the  '  contract  requires  is,  that  the  act  of  sulf- 
destruction  should  be  the  voluntary  and  wilful  act  of  a  man  having  at  the  time 
sufficient  powers  of  mind  and  reason  to  understand  the  physical  nature  and  con- 
sequences of  such  act,  and  having  at  the  time  a  purpose  and  intention  to  cause 
his  own  death  by  that  act,  and  the  question,  whether  at  the  time  he  was  capable 
of  understanding  the  moral  nature  and  quality  of  his  purpose,  is  not  relevant  to 
the  inquiry  further  than  as  it  might  help  to  illustrate  the  extent  of  his  capacity 
to  understand  the  physical  character  of  the  act  itself.'  Chief  Justice  Tindal  dis- 
sented from  the  judgment.  In  speaking  of  the  verdict,  he  says  :  '  It  is  not,  per- 
haps, to  be  taken  strictly  as  a  verdict  that  the  deceased  was  non  compns  mentis  at 
the  time  the  act  was  committed,  for  if  the  latter  was  the  meaning  of  tlie  jury,  the 
case  would  then  fall  witliin  that  description  mentioned  in  the  argument  to  be 
without  the  reach  of  the  proviso,  namely,  the  case  of  death  inflicted  on  himself 
by  the  party  while  under  the  influence  of  frenzy,  delusion,  or  insanity.'  This 
authority  was  followed  in  Clift  v.  Schwabe,  3  C.  B.  437,  where  it  was  substan- 
tially held  that  the  terms  of  the  condition  included  all  acts  of  voluntary  self- 
destruction,  and  that  whether  the  party  is  a  voluntary  moral  agent  is  not  in 
issue.  These  decisious  expressly  exclude  the  question  of  mental  soundness.  They 
are  in  hostility  to  the  tests  of  liability  or  responsibility  adopted  by  the  English 
courts  in  other  cases,  from  Coke  and  Hale  onwards.  Coke  said,  'A  little  mad- 
ness deprives  the  lunatic  of  civil  rights  or  dominion  over  property,  and  annuls 
wills.'  But,  to  exempt  from  responsibility  for  crime,  he  says,  '  Complete  igno- 
rance of  the  knowledge  of  right  and  wrong  must  exist.'  Lord  Mansfield  holds 
the  legal  test  of  a  sound  mind  to  be  the  knowledge  of  right  and  wrong,  good  and 
evil  ;  of  which  the  converse  is  ignorance  of  knowledge  of  right  and  wrong,  of  good 
and  evil.  Lord  Lyttleton  held  the  test  to  be  the  state  called  compos  mentis,  or 
sound  mind.  Lord  Erskine,  in  his  Defence  of  Hadfield,  defined  it  to  be  the  ab- 
sence of  any  practicable  delusion  traceable  to  a  criminal  or  immoral  act.  In 
1  Prichanl,  p.  16  (on  the  different  forms  of  insanity),  will  be  found  the  somewhat 
lengthy  definition  of  insanity  by  Lord  Lyndhurst,  1  Shelf.  Lun.  46.  The  Eng- 
lish judges  refuse  to  apply  to  the  act  of  the  insured  in  causing  his  death  the 
principles  of  legal  and  moral  responsibility  recognized  in  cases  where  tlie  contract, 
the  last  will,  or  the  alleged  crime  of  such  person  may  be  in  issue.  .  .  .  There  is  a 
conflict  in  the  authorities  which  cannot  be  reconciled.  The  propositions  embodied 
in  the  charge  before  us  are  in  some  respects  diff'erent  from  each  other,  but  in 
principle  they  are  identical.  They  rest  upon  the  same  basis,  the  moral  and 
intellectual  incapacity  of  the  deceased.  In  each  case  the  physical  act  of  self- 
destruction  was  that  of  George  Terry.  In  neither  was  it  truly  his  act.  In  the 
one  supposition  he  did  it  when  his  reasoning  powers  were  overthrown,  and  he 
had  not  power  or  capacity  to  exercise  them  upon  the  act  he  was  about  to  do.  It 
was  in  effect  as  if  his  intellect  and  reason  were  blotted  out  or  had  never  existed. 
In  the  other,  if  he  understood  and  appreciated  the  eff'ect  of  his  act,  an  uncon- 
trollable impulse,  caused  by  insanity,  compelled  its  commission.  He  had  not  the 
power  to  refrain  from  its  commission,  or  to  resist  the  impulse.  Each  of  the  prin- 
ciples put  forth  by  the  judge  rests  upon  the  same  basis,  that  the  act  was  not  the 


1  41  Ga.  338  ;  s.  c.  5  Am.  Rep.  535.     See  sX&o  jMst,  §§  325,  .^^14. 

683 


§321]  INSURANCE:    FIRE,   LIFE,   ACCIDENT,    ETC.  [CH.  XV. 

while  drunk.     The  plaintiff  claimed  that  it  was  by  mistake; 

voluntary,  intelligent  act  of  the  deceased.      The  causes  of  insanity  are  varied  as 
the  varying  circumstance  of  man. 

"  '  Some  for  love,  some  for  jealousy. 
For  grim  religion  some,  and  some  for  pride. 
Have  lost  tiieir  reason  ;  some  for  fear  of  want. 
Want  all  their  lives  ;  and  others  every  day, 
For  fear  of  dying,  suffer  worse  than  death.' 

[Armstrong  on  Health,  book  iv.  ver.  113-118.  Cited  in  1  Shelf.  Lun.  In.  43.] 
"  When  we  speak  of  the  'mental  condition'  of  a  person  we  refer  to  his  senses, 
his  perceptions,  his  consciousness,  his  ideas.  If  his  mental  condition  Ls  perfect, 
his  will,  his  memory,  his  understanding  are  perfect,  and  connected  with  a  healthy 
bodily  organization.  If  these  do  not  concur,  his  mental  condition  is  diseased  or 
defective.  Excessive  action  of  the  brain  whereby  the  faculties  become  exhausted, 
a  want  of  proper  action  whereby  the  functions  become  impaired  and  diminished, 
the  visions,  delusions,  and  mania  which  accompany  irritability,  or  the  weakness 
which  results  from  an  excess  of  vital  functions,  indigestion  and  sleeplessness,  are 
all  a  result  of  a  disturbance  of  the  physical  system.  The  intellect  and  intelli- 
gence of  man  are  manifested  through  the  organs  of  the  brain,  and  from  these, 
consciousness,  will,  memory,  judgment,  thought,  volition,  and  passion,  the  func- 
tions of  the  mind  do  proceed.  Without  the  brain  these  cannot  exist.  With  an 
injured  or  diseased  brain,  their  powers  are  impaired  or  diminished.  We  have  not 
before  us  the  particular  facts  on  which  the  question  of  the  sanity  of  Terry  was  pre- 
sented. We  may  assume  that  proof  was  given  upon  which  the  propositions  of  the 
charge  were  based.  We  do  not  know  whether  he  was  sleepless,  unduly  excited, 
or  unnaturally  depressed  ;  whether  he  had  abandoned  his  accustomed  habits  and 
pursuits  and  adopted  new  and  unusual  ones ;  from  a  quiet,  orderly  man,  he  had 
become  disorderly,  vicious,  or  licentious  ;  whether  his  fondness  for  his  wife  and 
children  had  changed  to  dislike  and  abuse  ;  or  jealousy,  pride,  the  fear  of  want, 
the  fear  of  death  had  overtaken  him.  He  may  have  realized  the  state  supposed 
by  the  counsel  in  arguing  Borradaile  v.  Hunter,  viz.  that  his  death  might  have 
resulted  from  an  act  committed  under  the  influence  of  delirium,  or  that  in  a 
paroxysm  of  fever  he  might  have  precipitated  himself  from  a  window,  or  having 
been  bled  he  might  have  torn  away  the  bandages.  Whether  he  swallowed  poison, 
or  did  the  other  insane  acts,  might  result  from  the  same  condition  of  body  and 
mind.  Delirium,  fever,  tearing  away  the  bandages  for  preserving  the  life,  the 
taking  of  poison,  in  a  ca.se  like  that  before  us,  are  all  results  of  bodily  disease. 
If  bodily  disease  in  these,  or  other  forms,  overthrew  Terry's  reasoning  faculties, 
in  other  words,  destroyed  his  consciousness,  his  judgment,  his  volition,  his  will, 
he  remained  the  form  of  the  man  only.  The  reflecting,  responsible  being  did  not 
exist.  In  the  language  of  the  successful  counsel  in  Borradaile  v.  Hunter,  '  in 
these  and  many  other  cases,  tlmugh,  strictly  speaking,  the  assured  may  be  said  to 
have  died  by  his  own  hands,  the  circumstances  clearly  would  not  be  such  as  the 
parties  contemplated  when  the  contract  was  entered  into.'  That  form  of  insanity 
called  impulsive  insanity,  by  which  the  person  is  irresistibly  impelled  to  the 
commission  of  an  act,  is  recognized  by  writers  on  this  subject.  It  is  sometimes 
accompanied  by  delusions,  and  sometimes  exists  without  them.  The  insanity 
may  be  patent  in  many  ways,  or  it  may  be  concealed.  We  speak  of  the  impulses 
of  per-sons  of  unsound  mind.  They  are  manifested  in  every  form,  —  breaking  of 
windows,  destruction  of  furniture,  tearing  of  clothes,  firing  of  houses,  assaults, 
murders,  and  suicides.     These  cases  are  to  be  carefully  distinguished  from  those 

684 


CH.  XY.]  SUICIDE.  [§  321 

and  the  court  said  there  must  be  an  intent  to  commit  sui- 
cide, and  if  the  intent  exists,  the  fact  that  the  man  is  maud- 
lin from  drink,  and  could  have  no  very  intelligent  conception 
of  his  surroundings,  does  not  help  the  case.  Death  from 
laudanum,  taken  by  a  drunken  man  with  the  intent  to  de- 

where  persons  in  the  possession  of  their  reasoning  faculties  are  impelled  by 
passion  merely  in  the  same  direction.  [See  Blundford  on  Insanity,  —  "  Impulsive 
Insanity."]  Dr.  Eay,  cited  by  Fisher,  approves  the  charge  of  the  judge  in 
Haskell's  case,  where  he  says  :  "  The  true  test  lies  in  the  word  poiver.  Has  the 
defendant  in  a  criminal  case  the  power  to  distinguish  right  from  wrong,  and  the 
poiver  to  adhere  to  the  right  and  avoid  the  wrong?'  Fisher  on  Insanity,  p.  83. 
The  question  of  sanity  has  usually  been  presented  upon  the  validity  of  an  agree- 
ment, the  capacity  to  make  a  will,  or  upon  responsibility  for  crime.  If  Terry 
had  made  an  agreement  under  the  circumstances  stated  in  the  charge,  a  jury  or 
court  would  have  been  justified  in  pronouncing  it  invalid.  A  will  then  made  by 
him  would  have  been  rejected  by  the  surrogate  if  offered  for  probate.  If  upon 
trial  for  a  criminal  offence,  upon  all  the  authorities,  he  would  have  been  entitled 
to  a  charge  that,  upon  proof  of  the  facts  assumed,  the  jury  nmst  acquit  him. 
[Freeman  v.  People,  4  Denio,  9;  Willis  v.  People,  32  N.  Y.  715,  719;  Seamen's 
Friend  Soc.  v.  Hopper,  33  id.  619  :  The  Marquis  of  Winchester's  Case,  Coke's 
Pieports,  3d  volume,  303  or  part  vi.  23  a ;  Combe's  Case,  Moore  (folio),  759.] 
We  think  a  similar  principle  must  control  the  present  case,  although  the  stand- 
ard may  be  different.  We  hold  the  rule  on  the  question  before  us  to  be  this  :  If 
the  assured,  being  in  the  possession  of  his  ordinary  reasoning  faculties,  from 
auger,  pride,  jealousy,  or  a  desire  to  escape  from  the  ills  of  life,  intentionally 
takes  his  own  life,  the  proviso  attaches,  and  there  can  be  no  recovery.  If  the 
death  is  caused  by  the  voluntary  act  of  the  assured,  he  knowing  and  intending 
that  his  death  shall  be  the  result  of  his  act,  biit  when  his  reasoning  faculties  are 
so  far  impaired  that  he  is  not  able  to  understand  the  moral  character,  the  general 
nature,  consequences,  and  effect  of  the  act  he  is  about  to  commit,  or  when  he  is 
impelled  thereto  by  an  insane  impulse,  which  he  has  not  the  power  to  resist,  such 
death  is  not  within  the  contemplation  of  the  parties  to  the  contract,  and  the  in- 
surer is  liable.  In  the  present  instance,  the  contract  of  insurance  was  made  be- 
tween Mrs.  Terry  and  the  company,  the  insured  not  being  in  form  a  party  to 
the  contract.  Such  contracts  are  frequently  made  by  the  insured  himself,  the 
policy  stating  that  it  is  for  the  benefit  of  the  wife,  and  that  in  the  event  of  death 
the  money  is  to  be  paid  to  her.  We  see  no  difference  in  the  case^.  In  each  it 
is  the  case  of  a  contract,  and  is  to  be  so  rendered  as  to  give  effect  to  the  intention 
of  the  parties.  Nor  do  we  see  any  difference  for  this  purpose  in  the  meaning  of 
the  expressions,  'commit  suicide,'  'take  his  own  life,'  or  'die  by  his  own  hands.' 
With  either  expression,  it  is  not  claimed  that  accidental  self-destruction,  death  in 
endeavoring  to  escape  from  the  flames,  or  the  like,  is  within  the  proviso.  The 
judgment  must  be  affirmed."  Mr.  Justice  Strong  dissented.  This  case,  of  course, 
gives  the  rule  for  the  Federal  courts.  And  perhaps  it  would  be  followed  in  Michi- 
gan, John  Hancock,  &c.  Ins.  Co.  v.  Moore,  34  Mich.  41 ';  and  Louisiana,  Phillips 
V.  Louisiana  Ins.  Co.,  26  La.  An.  404.  And  it  is  distinctly  adopted  in  Tennessee, 
Phadenhauer  v.  Germania  Ins.  Co.,  7  Heisk.  567,  and  Scheffer  v.  National  Ins. 
Co.,  25  Minn.  534  ;  and  has  also  been  followed  in  Vermont.  Hathaway  v.  National 
Life  Ins.  Co.,  48  Yt.  335. 

685 


§  322]  INSURANCE  :   FIRE,   LIFE,    ACCIDENT,    ETC.  [CH.  XV. 

stroy  life,  would  be  "dying  by  his  own  hands,"  while  with- 
out that  intent,  and  by  accident  or  mistake,  it  would  not.^ 
And  in  Fowler  v.  Mutual  Life  Insurance  Company, ^  the  facts 
showed  such  a  case  of  deliberate  suicide  that  the  court  re- 
fused to  allow  the  question  of  insanity,  or  of  voluntary  or 
involuntary  suicide,  to  go  to  the  jury,  and  directed  a  ver- 
dict for  the  defendant. 

§  322.  Suicide;  Sane  or  Insane.  —  [An  insurance  company 
may  lawfully  stipulate  for  forfeiture  if  the  insured  takes  his 
own  life  while  insane.^  But  it  must  be  very  careful  about 
the  wording  of  the  provision,  or  the  courts  will  sail  round 
it.  The  clause  "under  any  circumstances  die  by  his  own 
hand  "  is  to  be  understood  as  though  it  read  "  die  by  his 
own  hand;"  the  phrase  "under  any  circumstances  "  is  too 
vague  and  indefinite  to  serve  any  purpose.  The  meaning  of 
the  clause  "die  by  his  own  hand  "  has  lieen  fixed  by  the  law. 
It  is  synonymous  with  "suicide."  It  means  criminal  self- 
destruction,  and  the  death  of  the  insured  is  not  within  the 
proviso  if  he  was  under  the  controlling  influence  of  insan- 
ity, though  he  understood  the  physical  nature  of  his  act.  In 
other  words  no  matter  how  plainly  the  policy  may  declare 
against  liability  for  self-destruction,  the  courts  are  bound  to 
cover  insanity  if  any  shadow  of  a  rule  of  law  can  be  found 
to  support  the  ruling.'^  The  dissent  of  JJ.  Granger  and 
Dickman  is  much  more  sensible.  They  say  in  effect  that  if 
the  phrase  "die  by  his  own  hand"  under  any  circumstances 
does  not  include  death  by  his  own  hand  while  insane,  it  is 
difficult  to  rely  upon  the  English  language  to  express  any 
idea.  When  a  policy  exempts  the  company  from  liability 
in  case  of  self-destruction  voluntary  or  involuntary,  and 
death  comes  from  an  overdose  of  laudanum  taken  to  relieve 
pain,  the  proper  inquiry  is  whether  the  act  was  a  culpable 
one.  The  exemption  of  the  company  does  not  depend  on 
the  degree  of  negligence  of  the  insured  but  upon  its  culpa- 

1  Penfold  V.  Universal  Ins.  Co.  (N.  Y.),  10  Ins.  L.  J.  521. 

2  4  Lans.  (N.  Y. )  202. 

3  [Supreme  Commandery,  &c.  v.  Ainsworth,  71  Ala.  436.] 
<  [Schultz  V.  Insurance  Co.,  40  Ohio  St.  217.] 

686 


CH.  XV.]  SUICIDE.  [§  322 

hility.^  It  is  a  question  with  us  how  culpability  can  be  a 
necessary  element  in  "involuntary"  self-destruction.]  In 
Jacobs  V.  National  Life  Insurance  Company  ^  the  words  of 
exception  were  "  if  he  shall  die  by  his  own  hand  or  act,  vol- 
untary or  otherwise ; "  and  it  was  held  that  the  words  "  or 
otherwise  "  were  nugatory  as  of  uncertain  meaning.  Where 
the  policy  was  to  be  void  "in  case  of  the  death  of  the  in- 
sured, by  his  own  act  and  intention,  sane  or  insane,"  it  was 
held  that  no  recovery  could  be  had  if  the  insured  did  what 
he  intended,  whether  he  was  aware  of  the  moral  quality  of 
the  act  or  not.  The  addition  of  the  words  "sane  or  insane  " 
the  court  held  to  be  a  successful  attempt  to  eliminate 
from  the  case  the  question  of  the  moral  responsibility  of  the 
insured.^ (a)  In  Wisconsin  the  words  "  sane  or  insane  "  were 
held  to  have  the  like  effect  upon  the  preceding  words,  "  shall 
die  by  suicide,  felonious  or  otherwise."^  [So  in  Michigan, 
a  clause  against  death  by  one's  own  hand,  sane  or  insane, 
covers  all  conscious  acts  resulting  in  death. ^     Of  course  the 

1  [Mutual  Life  Ins.  Co.  v.  Lawrence,  8  Brad.  488,  491.1 

2  Sup.  Ct.  D.  C,  5  Big.  Life  &  Ace.  Ins.  Cas.  42.  See  also  Penfold's  Case, 
supra. 

8  Adkins  v.  Columlna  Life  Ins.  Co.,  70  Mo.  27,  following  Bigelow  v.  Berkshire 
Life  Ins.  Co.,  93  U.  S.  284,  and  regarding  the  word  "act"  in  that  case  as  the 
equivalent  of  the  words  "act  and  intention  "  in  the  case  under  discussion.  So 
held,  also,  in  Chapman  v.  Republic  Life  Ins.  Co.  (C.  Ct.  111.),  5  Big.  Life  &  Ace. 
Ins.  Cas.  110,  where  the  words  were  the  same  as  in  Adkins's  case. 

4  Pierce  v.  Travelers'  Ins.  Co.,  34  Wis.  389.  See  also  ilallory  v.  Travelers' 
Ins.  Co.  (N.  Y.),  2  Ins.  L.  J.  839.  ["Self-destruction,  felonious  or  otherwise," 
includes  all  cases  of  voluntary  self-destruction,  sane  or  insane.  Riley  v.  Hartford 
Fire,  &c.  Ins.  Co.,  25  Fed.  Rep.  315  (Mo.),  1885,  citing  15  Wall.  580  ;  111  U.  S. 
612.] 

6  [Streeter  r.  Insurance  Co.,  65  Mich.  199.] 

(a)   As  to  the  effect  of  this  clause  in  U.    S.    691.     Suicide   of    the  assured, 

the  policy,  see   Rens  v.   Northwestern  when  insane,  is  not  within  the  condi- 

Mut.    Relief    Ass'n,    100    Wis.     266  ;  tion  of  a  policy  avoiding  it  in  case  of 

Tritschler  y.  Keystone  Mut.  Ben.  Ass'n,  "death  by  his  own  hand."     Manhat- 

180   Penn.   St.  205  ;  Sjiruill  v.  North-  tan  L.  Ins.  Co.  v.  Broughton,  109  U.  S. 

western    Mut.    L.    Ins.  Co.,  120  N.  C.  121  ;  Accident  Ins.  Co.  v.  Crandal,  120 

141 ;    Billings    v.    Accident    Ins.    Co.  U.  S.  527  ;  Mut.  L.  Ins.  Co.  v.  Lcubrie, 

(Vt.),    17    L.    R.    A.    89,    and    note  ;  71  Fed.  Rep.  843  ;  42  Cent.  L.  J.  267, 

Sabinu.  Senate  of  the  National  Union,  and  note;  Kerr  y.  Minne.sota  M.  Ben. 

90    Mich.    177;     Salentine    v.   Mutual  Ass'n,  39  Minn.  174  ;  12  Am.  St.  Rep. 

Benefit    L.    Ins.     Co.,    79   Wis.    580;  631,  and  note;   Michigan  Mut.  L.  Ins. 

Home   Benefit   Ass'n   v.    Sargent,   142  Co.  v.  Naugle,  130  Ind.  79. 

687 


§  323]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.         [CH.  XV. 

court  does  not  mean  to  include  cases  of  accidental  death.  ^ 
And  the  United  States  Supreme  Court  holds  that  under  a 
policy  which  expressly  covers  only  "external,  violent  and 
accidental "  means  of  injury,  and  excludes  death  by  inten- 
tional injury  inflicted  by  others  or  by  suicide,  felonious  or 
otherwise,  sane  or  insane,  no  recovery  can  be  had  in  case  of 
death  by  self,  whether  insane  or  not,  nor  in  case  of  death 
caused  by  injuries  intentionally  inflicted  by  others.^]  In 
New  York  the  insurers  were  held  to  be  protected  by  a  clause 
exempting  them  from  liability  if  death  ensues  "from  any 
physical  movement  of  the  hand  or  body  of  the  insured,  pro- 
ceeding from  a  partial  or  total  eclipse  of  the  mind.  "^  If 
the  insanity  is  produced  by  intemperate  habits,  which  the 
insured  agrees  to  avoid  on  penalty  of  forfeiture  of  his  right 
to  indemnity,  it  is  a  complete  defence.*  [Sometimes  it  is 
agreed  that  in  case  the  insured  shall  die  by  his  own  hand 
while  insane,  the  company  shall  only  pay  back  the  premi- 
ums received,  with  interest.^  A  by-law  of  a  mutual  com- 
pany exempting  it  from  liability  in  case  of  suicide  and 
passed  subsequently  to  the  issue  of  a  certificate  to  B.,  can- 
not affect  B. 's  rights,  no  such  power  being  reserved  in  the 
contract  with  B.^] 

§  323.  Suicide  in  a  Fit  of  Insanity  does  not  avoid  a  Policy 
unless  Death  by  Suicide  be  excepted  from  the  Risk  ;  Express 
Agreement  to  insure  against  Voluntary  Suicide  void  as  against 
Public  Policy.  —  Suicide  in  a  fit  of  temporary  insanity  does 
not  avoid  a  policy  which  does  not  contain  an  express  provi- 
sion that  death  by  such  means  shall  avoid  it.'  (a)     That  such 

1  [See  §  307.     Scarth  v.  Security  Mat.  Life  Soc,  75  Iowa,  346.] 

2  [Travelers'  Ins.  Co.  v.  McCoiikey,  127  U.  S.  661,  667.] 

3  De  Gogorza  v.  Knickerbocker  Life  Ins.  Co.,  65  N.  Y.  232.  To  the  same 
effect  is  Schmidt  v.  Home  Life  Ins.  Co.  (Superior  Ct.  Cincinnati),  8  Ins.  L.  J. 
77,  where  the  language  was  "  suicide,  voluntary  or  involuntary,  sane  or  insane." 

*  Jarvis  v.  Conn.  Mut.,  &c.  Ins.  Co.,  C.  Ct.  (111.),  5  Ins.  L.  J.  507. 

5  [Salentine  v.  Mutual  Ben.  Life  Ins.  Co.,  24  Fed.  Rep.  159  (Wis.).  1885.] 

6  [Northwestern  Ben.  &  Mut.  Aid  Ass.  v.  Wanner,  24  Brad.  361.] 

^  Horn  V.  The  Anglo-Australian  &  Universal  Family  Life  Ass.  Co.,  7  Jur. 
N.  s.  673.      "It  appears  to  me  clear,"  si^ys  Wood,  V.  C,  in   this  case,  "that 


(a)    The  term  "  insanity,"  used  as  a     deranged  condition  of  the  mental  and 
defence,  means   such   a  perverted  and     moral   fticulties  as  to  render  a  person 
688 


CH.  XV.]  SUICIDE.  [§  323 

an  agreement  is  void  as  against  public  policy  was  also  the 
opinion  of  Lord  Campbell,  as  expressed  by  him  in  Moore  v. 
Woolsey.^  So  the  owner  of  a  ship,  who  insures  her  for  a 
year,  cannot  recover  upon  the  policy  if,  within  the  year,  he 
causes  her  to  be  sunk.  And  such  no  doubt  would  be  the 
case  where  the  plaintiff  claims  under  a  policy  on  the  life  of 
a  person  whose  death  he  has  caused  j^  so,  if  the  insured  set 
fire  to  his  own  house. ^ 

Perhaps  there  may  be  something  in  the  distinction  be- 
tween a  sane  and  an  insane  suicide  under  such  a  policy. 
And  it  has  been  said,  in  this  country,  in  a  case  where  the 

where  there  is  no  express  provision  in  the  policy,  that  in  the  event  of  the  insured 
dying  by  his  own  hand  the  policy  shall  become  void,  that  policy  is  not  vacated 
by  the  circumstance  of  his  having  died  by  his  own  hand  while  in  a  state  of  tem- 
porary insanity.  It  was  held  by  the  House  of  Lords,  in  Fauntleroy's  case.  The 
Amicable  Insurance  Society  v.  Bolland,  2  Dow  &  C.  1  ;  s.  c.  4  Bligh,  n.  s.  194, 
that  it  would  be  contrary  to  public  policy  to  insure  a  man  a  benefit  upon  his  dy- 
ing by  the  hand  of  public  justice  ;  and  as  it  would  be  contrary  to  the  policy  of  the 
law  for  any  such  express  contract  to  be  made,  so  no  contract  could  be  implied  in 
the  policy  to  pay  the  amount  in  such  an  event  ;  and  accordingly,  although  noth- 
ing was  said  in  the  policy,  one  way  or  the  other,  the  law  would  infer  as  a  condi- 
tion that  the  execution  of  the  insured,  in  consequence  of  a  crime  committed  by 
him,  was  not  one  of  the  cases  in  respect  of  which  the  policy  would  become  paya- 
ble. So  the  argument  might  be  pursued,  although  I  do  not  know  that  any  case 
has  so  decided,  to  the  same  extent,  in  the  case  of  a  person  committing  suicide 
while  in  a  sane  state  of  mind,  thus  committing  a  felony,  and  losing  his  life 
thereby  ;  but  I  know  of  no  rule  of  law  that  can  justify  me  in  extending  that  to 
the  case  of  a  person  committing  suicide  while  in  a  state  of  insanity,  and  therefore 
committing  no  legal  offence." 

1  4  E.  &  B.  243  ;  s.  c.  28  Eng.  L.  &  Eq.  248. 

2  Reed  v.  Royal  Exch.  Ass.  Co.,  Peake's  Add.  Cas.  70. 
8  Washington  Ins.  Co.  v.  Wilson,  7  Wis.  169. 

incapable  of  distinguishing  between  Mutual  L.  Ins.  Co.  v.  Wiswell  (56  Kan- 
right  and  wrong,  or  unconscious,  at  the  sas,  765),  35  L.  R.  A.  258,  and  note, 
time,  of  the  nature  of  the  act  he  is  com-  Suicide,  though  evidence  of  insanity, 
mitting  ;  or  where,  though  conscious  of  does  not  establish  it  as  a  fact,  and  the 
it  and  able  to  distinguish  between  right  presumption  of  sanity  places  the  burden 
and  wrong,  and  knowing  that  the  act  is  of  proof  upon  the  party  alleging  in- 
wrong,  yet  his  will,  by  which  is  meant  sanity.  Ingersoll  r.  Knights  of  the 
the  governing  power  of  the  mind,  has  Golden  Rule,  47  Fed.  Rep.  272  ;  Eit- 
been  otherwise  than  voluntarily  so  com-  ter  v.  Mutual  Life  Ins.  Co.,  69  iil.  505  ; 
pletely  destroyed  or  mystified  that  his  169  U.  S.  139  ;  Jones  v.  Gorham,  90 
actions  are  not  subject  to  it,  but  are  Ky.  622;  Bachmeyerr.  Mutual  Reserve 
bevond  his  control.  Davis  v.  United  Fund  L.  Ass'n,  82  Wis.  255  ;  Agen  v. 
States,  165  U.  S.  373,  378  ;  Ritter  v.  Mef  n  L.  Ins.  Co.  (104  Wis.),  SO  N.  W. 
Mutual  L.  Ins.  Co.,  169  U.  S.  139,  149  j  1020. 

VOL.  I. —44  689 


§  324]  INSURANCE  :    FIKE,    LIFE,    ACCIDENT,   ETC.  [CH.  XV. 

suicide  was  by  taking  arsenic,  and  no  question  of  insanity 
was  raised,  that  a  man  who  commits  suicide  is  guilty  of 
such  a  fraud  upon  the  insurers,  that  for  that  reason  alone 
he  cannot  recover,  even  though  there  be  no  such  condition 
in  the  policy.  ^  But  the  case  did  not  require  the  decision  of 
this  point.  And  in  Dormay  v.  Borradaile,^  the  question 
being  upon  a  covenant  in  a  marriage  settlement  to  keep  a 
policy  alive,  and  whether  suicide  was  a  violation  of  that 
covenant,  it  was  held  that  it  was  not.  The  covenant  was 
"to  do  and  perform  all  such  acts,  matters,  and  things  as 
shall  be  requisite  for  continuing  and  keeping  on  foot  a  pol- 
icy,"  and  it  was  held  not  the  equivalent  of  a  covenant  not 
to  do  anything  whereby  the  policy  should  become  forfeited ; 
and  a  suicide  (the  same  as  in  Borradaile  v.  Hunter)  who 
drowned  himself,  voluntarily  and  intending  it,  though  found 
by  the  jury  not  to  be  at  the  time  capable  of  distinguishing 
between  right  and  wrong,  was  held  not  to  have  violated  his 
covenant. 

§  324.  Bona  fide  Holder  for  Value ;  Beneficiary.  —  To  a  life 
policy  which  provided  that  if  the  party  die  by  his  own  hands 
the  policy  should  be  void  except  to  the  extent  of  any  bona 
fide  interest  which  a  third  person  might  have  acquired,  it 
was  objected  that  the  exception  was  an  incentive  to  suicide, 
and  that  the  policy  was  void  as  against  the  policy  of  the 
law.  But  the  court  thought  that,  though  a  stipulation  that 
the  policy  should  be  paid  in  case  of  suicide  of  the  insured 
would  be  obnoxious  to  that  objection,  yet  a  stipulation  that 
if  the  policy  should  be  assigned  bona  fide,  for  a  valuable  con- 
sideration, or  a  lien  upon  it  should  afterwards  be  acquired 
bona  fide,  for  valuable  consideration,  it  might  be  enforced 
for  the  benefit  of  others,  whatever  be  the  means  by  which 
death  is  occasioned,  was  not  open  to  the  objection.  That 
such  stipulation  may  promote  evil  by  leading  to  suicide  is 
too  remote  and  improbable  a  contingency  to  be  allowed  to 
counterbalance  the  many  obvious  advantages  which  would 

1  Hartman  v.  Keystone  Ins.  Co.,  21  Pa.  St.  466  ;   Bank  of  Oil  City  v.  Guar- 
dian, &c.  Ins.  Co.,  C.  C.  P.  (Pa.),  5  Big.  Life  &  Ace.  Ins.  Cas.  478. 
^  10  Beav.  335. 
690 


CH.  XY.]  SUICIDE.  [§  324 

result  from  holding  the  stipulation  valid. ^  But  an  assignee 
in  bankruptcy  is  not  such  a  hona  fide  holder  for  valuable 
consideration.  He  is  an  assignee  by  operation  of  law  and 
not  by  contract.2  So  where  there  is  a  condition  in  a  life 
policy  that  in  the  event  of  the  assured  dying  by  his  own 
hand  the  policy  shall  be  void,  except  to  the  extent  of  any 
hona  fide  interest,  which,  at  the  time  of  his  death,  shall  be 
vested  in  any  other  person  or  persons  for  his  or  their  own 
benefit,  the  exception  applies  as  much  when  that  interest  is 
vested  in  the  assurers  themselves  as  when  it  is  vested  in  a 
third  party. 

Therefore,  where  one  effected  a  policy  of  insurance  upon 
his  life,  with  the  above  condition  and  exception,  and  depos- 
ited the  same  with  the  insurers  by  way  of  collateral  security 
for  a  loan  from  them  to  him,  it  was  held  that,  notwithstand- 
ing the  suicide  of  the  insured,  the  policy  was  good  to  the 
extent  of  the  debt  for  which  it  was  held  as  security,  and 
therefore  that  the  debt  was  extinguished  by  the  njoneys 
which  became  payable  under  the  policy.^  So,  in  the  ab- 
sence of  express  stipulation  to  the  contrary,  suicide  by  the 
life  insured  will  not  avoid  a  policy  issued  on  that  life  for 
the  benefit  of  his  wife  and  children.'*  (a) 

1  Per  Lonl  CamphpU,  Moore  v.  Woolsey,  28  Eiig.  L.  &  Eq.  248  ;  s.  c.  4  E.  & 
B.  243 ;  White  v.  British  Empire  Mut.  Life  Ass.  Co.,  7  Law  Rep.  Eq.  394. 

2  Jackson  v.  Forster,  1  EL  &  El.  463  (Q.  B.);  affirmed  in  Exch.,  id.  476. 

s  38  L.  J.  N.  s.  Ch.  53  ;  The  Solicitors'  &  General  Life  Ass.  Co.  v.  Lamb,  1 
Hem.  &  M.  716  ;  affirmed  on  appeal,  2  De  Gex,  J.  &  S.  2.51  ;  s.  c.  33  Law  ,T.  Rep. 
K.  s.  Ch.  426  ;  Dufanr  v.  The  Professional  Life  Ass.  Co.,  25  Beav.  599  ;  s.  c.  27 
Law  J.  Rep.  N.  s,  Ch.  817;  Jones  i'.  The  Consolidated  Investment  &  Ass.  Co., 
26  Beav.  256  ;  s.  c.  28  Law  J.  Rep.  n.  s.  Ch.  66. 

*  Fitch  V.  Am.  Popular,  &c.  Ins.  Co.,  59  jST.  Y.  557.  [If  there  is  nothing  in 
the  policy  uor  the  constitution  and  by-law  to  prevent,  the  heirs  or  beneficiary  of 
a  member  of  a  mutual  benefit  association  may  recover,  althon!;h  he  committed 
suicide.  Mills  v.  Kebstock,  29  Jlinn.  380  ;  Kerr  v.  Minneapolis  Mut.  Ben.  Ass. 
39  Minn.  174.] 

{a)    In  Ritter  v.  Mutual  L.  Ins.  Co..  Under  a  policy  which  contains  no  sui- 

169  U.  S.  139  ;  70  Fed.  Pep.  954,  it  was  cide   clause,   the   suicide  of  an    insane 

held  that  there  can  be  no  recovery  on  a  person  is  insnied  against.     Grand  Lodge 

life  policy  by  the  executor  of  one  who,  v.  Wieting.  168  111.408,  418.     In  Sciler 

while  sane,  intentionally  took  his  own  v.  Economic  L.  Ass'n,  105  Iowa,  87,  it 

life,  even  though  the  policy  contains  no  was  held  that  such  a  policy,  if  taken 

clause  of  forfeiture  because  of  such  act.  out   in   good  faith,  is  not  avoided,  as 

691 


§  325]         insurance:  fire,  life,  accident,  etc.        [ch.  xv- 

§  325.  Evidence  ;  Suicide  ;  Insanity  ;  Negligence  ;  Accident. 
—  When  the  dead  body  of  the  insured  is  found  under  such 
circumstances  and  with  such  injuries  that  the  death  may 
have  resulted  from  negligence,  accident,  or  suicide,  the  pre- 
sumption is  against  suicide,  as  contrary  to  the  general  con- 
duct of  mankind,  a  gross  moral  turpitude  not  to  be  presumed 
in  a  sane  man ;  ^  and  whether  it  was  from  one  or  the  other, 
if  there  is  any  evidence  bearing  upon  the  point,  is  for  the 
jury ;  as  for  instance,  whether  the  taking  of  an  overdose  of 
laudanum  was  intentional  or  by  mistake.  If  the  latter,  it 
was  accidental  and  not  suicidal. ^  Where  the  question  arises 
whether  the  death  is  by  suicide,  evidence  that  the  deceased 
was  an  infidel  or  an  atheist  or  a  spiritualist,  is  inadmissible 
as  affording  an  inference  of  greater  probability  of  suicide. 
The  inference  of  one  fact  from  the  proof  of  the  existence  of 
another  depends  upon  the  observed  connection  of  the  two  in 
the  relation  of  antecedent  and  consequent,  —  a  relation 
which,  so  far  as  the  two  facts  in  question  are  concerned,  is 
so  entirely  unsupported  by  experience  and  observation  as  to 
belong  rather  to  the  domain  of  conjecture  than  of  proof.  ^ 
[The  burden  of  proof  is  upon  the  company  setting  up  suicide 

1  Mallory  v.  Travelers'  Ins.  Co.,  47  N.  Y.  52;  Same  v.  Same  (N.  Y.),  2  Ins. 
L.  J.  839.  '  [Contra.  There  is  no  legal  presumption  that  the  insured  did  not  kill 
himself.     Mutual  Ben.  Life  Ins.  Co.  v.  Daviess'  Ex'x,  87  Ky.  541.] 

2  Pierce  v.  Travelers'  Ins.  Co.,  34  Wis.  389  ;  anie,  §  321  ;  Lawrence  v.  Mutual 
Life  Ins.  Co.  (App.  Ct.  of  111.),  9  Ins.  L.  J.  313  ;  Shank  v.  United  Brethren,  &c. 
Soc,  84  Pa.  St.  385  ;  Newton  v.  Mutual  Benefit,  &c.  Ins.  Co.,  2  Dill.  Q.  Ct.  154. 

3  Gibson  i;.  American  Mut.  Life  Ins.  Co.,  37  N.  Y.  (10  Tiff.)  580  ;  Continental, 
&c.    Ins.  Co.  V.  Delpeuch,  82  Pa.  St.  225. 

against  the  beneficiary  named  therein,  stipulation  against  death  by  "taking 
because  the  insured,  while  sane,  pur-  poison  "  does  not  apply  to  an  accidental 
posely  took  his  own  life.  But  see  Hop-  taking  thereof.  Menneiley  v.  Employ- 
kins  V.  Northwestern  L.  Ass.  Co.,  94  ers'  L.  As.  Corp.,  148  N.  Y.  596;  Eaily 
Fed.  Rep.  729.  If  not  taken  out  in  v.  Standard  L.  Ins.  Co.,  113  Mich.  58  ; 
good  faith,  fraud  through  suicide  for  Travelers'  Ins.  Co.  v.  Dunlap,  160  111. 
the  benefit  of  friends  or  creditors  is  a  642  ;  Met'n  Ac.  Ass'n  v.  Froiland,  161 
good  defence.  See  Smith  v.  National  111.  30  ;  Miller  v.  Fidelity  &  Cas.  Co., 
Benefit  Society,  123  N.  Y.  85.  The  97  Fed.  Rep.  836.  So  of  the  accidental 
exception  in  a  policy  of  "death  by  sui-  "inhaling  of  gas."  Menneiley  v.  Em- 
cide,  whether  felonious  or  otherwise,"  ploy  ers'  L.  As.  Cor\\,  supra;  Pickett  v. 
includes  death  by  poison  taken  acciden-  Pacific  M.  L.  Ins.  Co.,  144  Penn.  St. 
tallv,  by  mistake  for  medicine.  Cole  v.  79  ;  Fidelity  &  Cas.  Co.  v.  Waterman, 
Accident  Ins.  Co.,  61  L.  T.  227.     But  a  161  111.  632. 

692 


CH.  XV.] 


SUICIDE. 


[§325 


as  a  defence.^]  And  the  burden  is  upon  the  party  alleging 
insanity  to  prove  itJ  (a)  There  is  no  presumption  of  law, 
jjrima  facie  or  otherwise,  that  self-destruction  arises  from 

1  [Goldschmitlt  v.  Mut.  Life  Ins.  Co.,  102  N.  Y.  486.] 

2  Terry  v.  Life  Ins.  Co.,  ante,  §§  319,  320. 

(a)  The  insurer   has  the  burden  of 
proof  upon  the  issue  of  suicide  as  a  de- 
fence,   the   presumption   being  against 
suicide.     Knights  of  Pythias  v.   Beck, 
94  Fed.  Eep.  751  ;  Standard  L.  &  Aoc. 
Ins.  Co.  V.  Thornton,  100  id.  582  ;  Wal- 
cott   V.   Met'n  Ins.   Co.,    64  Vt.    221; 
Carnes  v.  Iowa  State  T.  M.  .Ass'n,  106 
Iowa,   281  ;    Dennis  v.  Union  Mut.  L. 
Ins.  Co.,  84  CaL  570  ;   Ins.  Co.  v.   Ben- 
nett, 90  Tenn.  256  ;  Supreme  Council  v. 
Brashear.s,  89  Md.  624  ;    Fidelity  Mut. 
L.  Ass'n  V.    Miller,  92  Fed.  Rep.  63  ; 
Merrett  v.  Preferred  Masonic  Mut.  Ace. 
Ass'n.  98  Mich.  338  ;    Leman  v.  Man- 
hattan L.  Ins.  Co.,  46  La.  Ann.  1189  ; 
Hale  v.  Life  Ind.  Co.,   61  Minn.  516; 
Travellers'  Ins.  Co.  v.  Nitterhouse,   11 
Ind.  App.  155  ;   Agen  v.  Met'n  L.  Ins. 
Co.  (Wis.),  29  Ins.  L.  J.  37  ;  see  Fidel- 
ity &  Cas.  Co.  V.  Weise  (111.),   id.   74  ; 
Home    Benefit   Ass'n    v.   Sargent,    142 
U.  S.  691 ;   Conadeau  v.  American  Ace. 
Co.,  95  Ky.  280.    The  same  presumption 
applies  to  murder  as  a  defence  in  the 
law  of  accident  insurance.     See  Ins.  Co. 
V.   Bennett,   90  Tenn.  256  ;    Warner  v. 
U.  S.  Mut.  Ace.  Ass'n,  8  Utah,  431.    As 
to  the  right  of  an  assignee  for  value  to 
recover  in  case  of  suicide,  see  City  Bank 
V.   Sovereign  L.  A.  Co.,  32  W.  R.   658  ; 
60  L.  T.  565.     As  to  the  evidence  that 
is  admissible  and  sufficient  to  overcome 
such    presumptions,    see    above    cases  ; 
Travelers'   Ins.  Co.  v.   Melick,  65  Fed. 
Rep.  178  ;   Conn.   Mut.  L.  In.s.  Co.  v. 
McWhirter,    73    id.    444  ;    Sliarland  v. 
Washington  L.   Ins.  Co.,  101  id.  206  ; 
Home  Benefit  Ass'n  v.  Sargent,  142  U. 
S.  691  ;  Mutual  L.  Ins.  Co.  v.  Tillman, 
84  Texas,  31  ;    Mutual   L.   Ins.   Co.  v. 
Hayward  (Tex.  Civ.  App.),  23  Ins.  L.  J. 
694  ;  Williams  v.  U.  S.  Mut.  Ace.  Ass'n, 
133  N.  Y.  366.     It  is  a  question  of  law 
for  the  court  to  decide  whether  the  evi- 


dence shows  a  reasonable  probability  of 
suicide,  and,  if  such  probability  exists, 
then  it  is  for  the  jury  to  decide  upon  the 
contiicting  evidence.     Agen  v.  Met'n  L. 
Ins.  Co.,  29  Ins.  L.  J.  37  ;  Reus  v.  North- 
western Mut.  Ben.  Ass'n,  100  Wis.  266. 
Death  from  accident,  or  from  "  external 
violence  and  accidental  means,"  is  pre- 
sumed when  the  evidence  as  to  suicide  or 
murder  is  conflicting  and  about  evenly 
balanced,  and  positive  proof  of  the  cause 
of  death  is  not  retjuired  by  the  jjolicy. 
IngersoU  v.  Knights  of  the  Golden  Rule, 
47  Fed.  Rep.  272  ;    Burn  ham  v.  Inter- 
state Cas.  Co.,  117  Mich.  142  ;    Konrad 
V.   Union  Cas.   Co.,  49  La.  Ann.  636  ; 
Ins.  Co.  V.  Bennett,  90  Tenn.  256  ;  see 
to  the  effect  that  the  claimant  has  the 
burden  of  proof  upon  an  accident  policv, 
Fidelity  &  Cas.  Co.  v.  Weise  (111.),  29 
Ins.  L.  J.  74  ;  Carnes  v.  Iowa  State  T. 
M.  Ass'n,    106   Iowa,    281  ;    Brown   v. 
Sun  L.  Ins.  Co.  (Tenn.),  57  S.  W.  415. 
As  to  the  effect  of  suicide  after  au  as- 
sault that  must  speedily  result  in  death, 
see  People  v.  Lewis,  124  Cal.  551  ;  34 
Am.  L.  Rev.  442.    If  the  assured  takes  his 
own  life  when  he  is  mentally  incapable 
of    comprehending     his    act     morally, 
though  fully  understanding  its  physical 
nature,  the  insurer  may  still  be  liable, 
though  the  policy  exempt  it  from  suicide 
resulting  directly  from  involuntary  dis- 
ease or  accident.    JIanhattan  L.  Ins.  Co. 
V.    Broughton,    109   U.  S.   121  ;   Conn. 
Mut.   L.  Ins.   Co.  V.  Akens,   150   U.  S. 
468  ;    Ritter  v.  New  York  Mut.  L.  Ins. 
Co.,  69  Fed.  Rep.  505  ;    169  U.  S.  139  ; 
see  Accident  Ins.  Co.  v.   Crandal,   120 
U.  S.  527  ;  Johns  v.  Northwestern  JIut. 
Relief  Ass'n,   90  Wis.   332  ;   Cotter    i\ 
Koyal    Neighbors  (.Minn.),    79    N.   W. 
542 ;    Burnham    v.    Interstate  Casualty 
Co.,  117  Mich.  142  ;  Cochran  v.  .Mutual 
L.   Ins.   Co.,    79   Fed.    Rep.    46.      As 
693 


§  325]  iNSUiiANCE :   fire,  life,  accident,  etc.       [ch.  XV. 

suicide;  but  suicide  threatened  or  attempted,  or  actually 
committed,  is  competent  evidence  upon  that  issue. ^  The 
opinion  of  unprofessional  witnesses  as  to  whether  a  person 
under  a  given  state  of  facts,  if  sane,  would  have  taken  his 
own  life,  is  not  competent  evidence. ^  Nor  is  evidence  of  a 
current  rumor  to  show  the  probable  motive  of  an  act,  as  of 
suicide,  admissible,  unless  it  be  shown  that  the  rumor  was 
known  to  the  party  before  he  committed  the  act.^  [When 
the  question  was  whether  the  assured,  X.,  died  by  his  own 
hand,  the  declaration  of  A.,  since  dead,  that  on  the  night 
of  the  assured's  death,  he  saw  a  man,  B.,  come  from  X. 's 
room  saying  "something  about  a  man  having  shot  himself," 
that  A.  then  went  into  the  room  and  found  that  X.  was 
dead,  and  that  no  one  else  was  around  at  the  time,  was 
admitted  as  a  part  of  the  res  gestce,  both  A.  and  B.  being 
dead.^  A  letter  left  by  the  suicide  requesting  that  the  re- 
volver with  which  he  was  going  to  shoot  himself  be  preserved 
for  a  keepsake  for  his  darling  boy,  and  telling  of  a  voice  he 
thought  his  mother's  calling  him  to  die,  is  evidence  for  the 
jury  of  an  insane  impulse.^  The  finding  of  the  coroner's 
jury  is  prima  facie  evidence  of   the    manner   and   cause   of 

1  Mutual  Life  Ins.  Co.  v.  Terry,  ante,  §  319  ;  Wolff  v.  Connecticut,  &c.  Ins. 
Co.,  C.  Ct.  (Mich.),  8  Ins.  L.  J.  97  ;  Coverston  U.Connecticut,  &c.  Ins.  Co.,  C. 
Ct.  (Mo.),  1  Am.  L.  T.  Uep.  N.  s.  239  ;  s.  c.  4  Big.  Life  &  Ace.  Ins.  Cas.  169  ; 
Moore  v.  Connecticut,  &c.  Ins.  Co.,  C.  Ct.  (Mich.),  1  Am.  L.  T.  Kep.  319  ;  s.  c. 
4  Big.  Life  &  Ace.  Ins.  Cas.  139  ;  McClure  v.  Mut.  Life  Ins.  Co.,  55  N.  Y.  651  ; 
Coffey  V.  Home,  &c.  Ins.  Co.,  44  How.  Pr.  (N.  Y.)  481 ;  Mallory  v.  Travelers- 
Ins.  Co.,  47  N.  Y.  52  ;  Bank  of  Oil  City  v.  Guardian,  &c.  Ins.  Co.,  C.  Ct.  (Pa.), 
4  Ins.  L.  J.  473  ;  Hartman  v.  Connecticut,  &c.  Ins.  Co.  (Ohio),  4  Ins.  L.  J.  159  ; 
Weed  V.  Mutual  BeneKt  Life  Ins.  Co.,  35  Superior  Ct.  (N.  Y.),  386;  Hiatt  v. 
Mutual  Life  Ins.  Co.,  2  Dill.  C.  Ct.  572  ;  Isett  r.  American  Life  Ins.  Co.,  ante, 
§  317.  As  to  evidence  of  Insanity,  see  also  Higbie  v.  Guardian  Mut.  Life  Ins. 
Co.,  53  N.  Y.  603. 

2  St.  Louis  Mut.  Life  Ins.  Co.  v.  Graves,  6  Bush  (Ky.),  268. 

3  Ibid.     See  also  poxt,  §  584. 

4  [Newton  v.  Ins.  Co.,  2  Dill.  154,  155.] 

&  [Meacham  v.  N.  Y.  State  Mut.  Benefit  Ass.,  44  Hun,  365.] 

to  statutory    provisions    reducing    the  ciety,  see  Supreme  Lodge  v.  La  JLilta, 

amount  to  be  paid  in  case  of  suicide,  95  Tenn.  157  ;  Jarman  o.  Knights  Tem- 

see  Keller  v.  Travelers'  Ins.  Co.,  58  Mo.  plars'  L.    Ind.  Co.,   95   Fed.  Rep.   70  ; 

App.  557.     As  to  subsequent  regulation  Knights  of  Pythias  v.  Stein,  75  Miss, 

by  the  insurer  or  by  a  benevolent  so-  107. 

694 


CH.  XV.]  SUICIDE.  [§  325 

death.  1  Proofs  of  death  including  the  coroner's  inquest  and 
verdict  of  the  coroner's  jury  are  not  admissible  except  for 
the  purpose  of  showing  performance  of  the  conditions  in 
regard  to  preliminary  proofs.  Neither  can  the  testimony 
of  the  wife  at  the  inquest  be  introduced  to  contradict  her 
evidence  in  a  suit  against  the  company  by  her,  as  adminis- 
tratrix, she  being  called  to  the  stand  by  the  company. 2  In 
this  case  the  wife  testified  clearly  before  the  coroner  that 
her  husband  shot  himself,  but  in  the  suit  against  the  com- 
pany denied  the  facts,  and  denied  that  she  so  testified  before 
the  coroner.  An  allegation  that  the  insured  "did  immor- 
ally, wrongfully  and  wickedly  "  commit  suicide  is  equivalent 
to  an  allegation  of  self-destruction  while  sane.^J 

1  [Walther  v.  Mutual  Life  Ins.  Co.,  65  Cal.  417.] 

2  [United  States  Life  Ins.  Co.  v.  Kielgast,  26  Brad.  567,  571-572.] 

2  [Northwestern  Benevolent  &  Mut.  Aid  Ass.  v.  Bloom,  21  Brad.  159.] 

695 


§  326]  INSURANCE  :   FIRE,   LIFE,   ACCIDENT,  ETC.         [CH.  XVI. 


CHAPTER  XVI. 

OF  DEATH  BY  LAW,  OR  WHILE  VIOLATING  IT,  BY  VIOLENCE, 
CASUALTY,  OR  WAR;  AND  OF  RESTRICTIONS  UPON  RESIDENCE 
AND   TRAVEL. 

Analysis, 

§  326.  "Death  by  the  hands  of  justice"  is  excepted,  impliedly,  whether 

there  is  any  express  provision  or  not,  and  indeed  could  not  be 
covered  even  if  expressly  agreed  upon. 

§  327.  Death  in  the  known  violation  of  law.     If  two  men  quarrel,  and  A. 

flees,  is  followed,  and  slain  by  B.,   under  circumstances  that 
would  have  justified  A.  in  killing  B.   in  self-defence,  A.  does 
not  die  in  the  known  violation  of  law,  §  327  ;  see  §  327  A. 
presumption  as  to  foreign  law,  §  331. 

§  327  A.  One  retreating  from  assault  or  robbery.     Suicide  as  a  crime.     Sui- 

cide to  avoid  arrest  for  a  prior  crime  is  not  death  in  conse- 
quence of  a  violation  of  law. 

§  328.  One  shot  in  the  act  of  unhitching  his  debtor's  horses  in  order  to 

take  them  as  redress  for  his  debt  is  within  the  exception. 

§  329.  In  Massachusetts  the  act  must  be  a  criminal  one. 

in  New  York  the  tendency  is  to  hold  any  unlawful  act  that 
might  lead  to  conflict  or  otherwise  tend  to  endanger  life  is 
within  the  intent,  whether  prohibited  by  the  criminal  code  or 
not.  So  in  Indiana  ;  see  §  327  A. 
if  the  violation  of  law  has  no  causative  relation  to  the  death  it 
is  immaterial,  as,  where  a  man  is  killed  by  accident  while 
swearing,  §  329. 

§  330.  Death  by  violence  is  covered  by  policy  unless  expressly  excepted. 

§  332.  War.     Death  by  casualty  or  in  consequence  of  war.     Permit. 

§§  333-334.     What  constitutes  entering  military  service. 

§§  335-339.     Restrictions  upon  residence  and  travel, 
license,        335,  338. 
"settled  limits,"  §  337. 

waiver  by  comjiany  or  by  agent  receiving  premiums  with  knowl- 
edge of  breach,  §  339. 

§  326.  Death  by  the  Hands  of  Justice.  —  Usually  associ- 
ated with  the  exception  of  liability  for  death  by  suicide  is 
that  of  "death  by  the  hands  of  justice."  This  is  defined  by 
Tindal,  C.  J.,  as  dying  in  "consequence  of  a  felony  previ- 
ously committed. "  ^     It  is  death  under  and  by  virtue  of  a 

1  Borradaile  v.  Hunter,  5  M.  &  G.  639. 

696 


en.  XVI.]  OF   DEATH   BY   LAW,   ETC.  [§  327 

judicial  sentence  for  some  crime,  and  not  merely  a  rightful 
killing,  as  in  case  of  a  runaway  slave  shot  by  a  patrolman 
who  was  attempting  to  apprehend  him,  as  it  was  his  legal 
right  and  duty  to  do.^  Death  under  such  circumstances  is 
not  "by  means  of  any  invasion,  insurrection,  riot,  or  civil 
commotion,  or  of  any  military  or  usurped  authority,  or  by 
the  hands  of  justice."^ 

An  exception  of  liability  in  case  of  "death  by  the  hands 
of  justice  "  has  been  held  to  be  unnecessary,  as  it  is  against 
public  policy  to  insure  against  the  consequences  of  a  capital 
felony;  and  such  a  risk  could  not  be  covered  by  the  policy 
even  if  expressly  agreed  upon.  As  the  law  will  not  permit 
an  express  stipulation  that  a  man  shall  derive  pecuniary 
benefit  upon  his  dying  by  the  hands  of  public  justice,  as 
against  public  policy,  it  will  not  imply  any  such  stipula- 
tion. Death,  therefore,  at  the  hands  of  public  justice  works 
a  forfeiture  of  all  right  to  indemnity  under  a  policy,  whether 
it  does  or  does  not  contain  such  stipulation. ^ 

§  327.  Death  in  known  Violation  of  Law.  —  Another  excep- 
tion from  liability  is  that  of  "death  in  the  known  violation 
of  law;"  and  what  constitutes  "death  in  the  known  viola- 
tion of  law  "  has  been  the  subject  of  considerable  discussion; 
but  it  cannot  be  said  that  the  law  is  settled  upon  this  point. 
In  Harper  v.  Phoenix  Insurance  Company,*  the  question 
arose  whether  killing  in  self-defence  was  within  the  pro- 
viso; but  as  the  facts  found  and  reported  did  not  fully  pre- 
sent this  case,  it  was  sent  back  for  a  new  trial,  when  the 
facts  were  agreed;  and  these,  with  the  opinion  of  the  court 
thereon,  are  stated  in  the  note.^ 

1  Spruill  V.  North  Carolina  Mut.  Life  Ins.  Co.,  1  Jones  (N.  C.)  Law,  126. 

2  Ibid. 

8  The  Amicable  Ins.  See.  v  Bolland,  2  Dow  &  C.  1  ;  s.  c.  4  Bligh,  X.  s.  194, 
overruling  s.  c.  Bolland  v.  Disney,  3  Russ.  350. 

*  18  Mo.  109. 

5  "On  the  6th  day  of  February,  1850,  and  in  the  year  within  the  time  for 
which  the  life  of  said  Edmund  Harper  was  insured,  one  Coryell  was  talking  to  a 
man  named  Wilson,  standing  about  forty  paces  from  B.  Harper's  store,  where  the 
said  Edmund  Harper,  the  deceased,  then  was.  The  deceased  spoke  to  tlie  said 
Wilson,  and  asked  him  if  he  knew  to  whom  he  was  speaking,  and  admonished 
him  to  keep  his  hand  on  his  pocket.     Coryell  then  approached  the  deceased,  and 

697 


§  327 A]     insurance:  fire,  life,  accident,  etc.        [ch.  xvi. 

« 

[§  327  A.  Where  the  insured  and  another  attacked  B., 
who  drew  a  pistol,  and  while  the  insured  was  retreating  B.  's 

inquired  if  that  insult  was  intended  for  him.  The  deceased  replied  that  it  was. 
The  parties  quarrelled,  the  deceased  drew  a  pistol  with  a  single  barrel  and  snapped 
it  at  Coryell,  who  thereupon  drew  a  revolver  and  advanced  upon  the  deceased, 
standing  on  the  sill  of  B.  Harper's  store  door,  who  threw  his  pistol,  which  had 
missed  fire,  and  struck  Coryell.  The  deceased  then  stepped  into  the  store  of  B. 
Harper,  and  said  Coryell,  standing  in  the  door  of  said  store,  with  his  revolver 
shot  at  and  missed  said  deceased,  who  was  inside  the  store,  and  eight  or  ten  feet 
from  the  door.  The  deceased  then  retreated  precipitately  behind  an  offset  formed 
by  a  stairway,  six  or  eight  feet,  and  picked  up  a  stick  of  wood,  and  raised  it  in  a 
threatening  position  over  his  head,  but  did  not  advance  upon  said  Coryell,  nor 
attempt  to  use  said  stick  in  any  other  manner.  Coryell  then  fired  again  with  his 
revolver,  and  shot  the  deceased  through  his  body,  of  which  he  died  in  a  few 
minutes.     The  whole  difficulty  was  one  continuous  quarrel. 

"Upon  these  facts  the  court  found  for  the  defendant,  whereupon  the  plaintiff 
sued  out  this  writ  of  error  :  1.  In  the  construction  of  the  contract  which  has 
given  rise  to  this  controversy,  we  are  not  authorized  to  be  influenced  by  any  con- 
siderations affecting  the  preservation  of  the  peace  and  order  of  society,  or  of  the 
morals  of  the  party  insured.  Whilst  the  law  will  not  countenance  contracts 
against  its  policy,  it  does  not  look  for  a  support  to  itself  in  the  stipulations  of 
men.  In  life  policies  the  insurer  has  a  guaranty  against  increasing  the  risk  in- 
sured, by  that  love  of  life  which  nature  has  implanted  in  every  creature.  In 
such  policies,  unless  it  is  otherwise  stipulated,  the  insurer  takes  the  subject  in- 
sured with  his  flesh,  blood,  and  passions.  The  dangers  to  which  the  lives  of 
men  are  exposed  from  sudden  ebullitions  of  feeling  are  a  lawful  matter  of  insur- 
ance. When  this  cause  was  formerly  here,  the  idea  intended  to  be  conveyed  in 
the  opinion  given  was  that  a  person  could  not  be  said  to  have  died  in  the  known 
violation  of  a  law  of  this  State,  when  a  crime  attached  to  the  individual  by  whom 
he  was  slain.  It  was  not  supposed  that  therefore  it  followed  that  in  all  cases 
when  the  killing  was  without  crime,  that  the  person  slain  died  in  the  known 
violation  of  the  law.  We  see  no  reason  to  change  the  opinion  then  hazarded. 
Although  conditions  in  policies,  similar  to  that  now  under  consideration,  are  not 
unusual,  we  have  not  been  enabled  to  find  any  case  in  which  its  interpretation 
has  come  up  for  adjudication.  We  must  then,  as  in  all  other  cases  involving  the 
construction  of  contracts,  look  to  the  intent  of  the  ])arties,  as  gathered  from  the 
instrument  embodying  their  minds.  It  is  obvious  that,  in  giving  the  words  of 
the  condition  a  literal  meaning,  cases  will  be  embraced  which  no  one  will  main- 
tain were  in  the  contemplation  of  the  parties.  If  the  person  whose  life  is  insured 
uses  offensive  language  to  one  whilst  they  are  engaged  in  an  unlawful  game  of 
chance,  which  language  is  concerning  the  game,  and  he  is  shot  down  for  the 
provocation,  it  would  not  be  maintained  that  he  died  in  the  known  violation  of  a 
law  of  the  land,  within  the  meaning  of  the  contract.  So  if  he  is  riding  a  race  in 
a  public  highway,  which  is  forbidden,  and  his  horse  falls,  and  he  is  thrown  and 
his  neck  broken,  he  does  not  die  in  the  known  violation  of  the  law  of  the  land, 
within  the  meaning  of  the  terms  of  the  condition.  So,  also,  in  a  quarrel,  if  he 
assails  another  with  his  open  hand,  and  is  thereupon  instantly  shot  down,  he 
does  not  die  in  the  known  violation  of  a  law  within  the  intent  of  the  policy. 
Many  similar  instances  might  be  put,  which,  it  is  clear,  were  not  within  the 
meaning  of  the  parties,  and,  if  they  were,  the  contract  would  be  much  narrowed 

698 


I 


CH,  XVI.]  OF   DEATH   BY   LAW,   ETC.  [§  327  A 

pistol,  bj  intention  or  by  accident  in  tbe  struggle  with  the 
other  assaulter,  went  off,  and  killed  the  insured,  it  was  hold 

in  its  operation.  If,  then,  the  literal  sense  of  the  words  of  the  iiolicy  leads  to 
conclusions  which  are  inadmissible,  we  are  necessarily  driven  to  some  other  mode 
in  order  to  ascertain  the  meaning  of  the  parties.  lu  the  interpretation  of  con- 
tracts of  insurance,  the  maxim  noscitur  a  suciis  obtains.  When  a  clause  stands 
with  ethers,  its  sense  may  be  gathered  from  those  which  immediately  precede 
and  follow  it.  'J'he  clause  in  the  policy  which  immediately  goes  before  that  under 
consideration  is,  '  If  the  party  shall  die  by  the  hands  of  justice.'  Now,  do  not 
these  words  clearly  indicate  the  idea  in  the  minds  of  the  parties  at  the  time  ? 
Do  they  not  show  that  it  was  a  justifiable  killing  ?  There  are  other  modes  of  killing 
justifiable  besides  execution  by  the  law.  Dying  by  the  hands  of  justice  means  dying 
by  the  execution  of  the  sentence  of  law.  The  fourth  section  of  the  secoml  article 
of  the  act  concerning  crimes  and  punishments  enumerates  many  instances  of 
justifiable  homicide.  These  are,  in  resisting  any  attempt  to  murder  or  to  commit 
any  felony  on  the  person  or  in  a  dwelling-house  ;  in  a  lawful  defence  of  tiie 
person,  where  there  is  reasonable  cause  to  apprehend  a  design  to  commit  a  felony  ; 
when  necessarily  committed  in  attempting,  by  lawful  ways  and  means,  to  appre- 
hend any  person  for  any  felony  committed,  or  in  lawfully  suppressing  any  riot  or 
insurrection,  or  in  lawfully  keeping  or  preserving  the  peace.  Here  are  abundant 
instances  in  which  the  words  of  the  condition  can  have  play,  without  resorting 
to  a  latitude  of  construction  which  so  extends  its  sense  as  to  embrace  cases  which 
were  never  in  the  contemplation  of  the  parties.  As  there  was  but  one  mode  of 
justifiable  killing  expressed,  it  was  necessary  to  use  general  words  to  include 
all  other  modes  of  such  killing,  as  they  were  equally  within  the  meaning  of 
the  contract.  The  other  clause  in  the  condition  is  that  if  the  party  shall 
die  in  consequence  of  a  duel.  If  a  man  falls  in  a  duel,  his  slayer  is  guilty 
of  murder.  A  duel  is  a  deliberate  act,  and  the  parties  voluntarily,  in  viola- 
tion of  law,  expose  themselves  to  death.  The  kindred  clauses  of  the  con- 
dition thus  show  that  a  dying  in  consequence  of  a  felony  in  the  very  act  or 
course  of  being  committed  by  the  insured,  and  a  dying  in  consequence  of  a 
felony  previously  committed  by  him,  were  in  the  contemplation  of  the  parties. 
Now  it  would  seem  that,  upon  the  acknowledged  rule  of  construction,  -noacitur  a 
sociis,  the  last  clause  in  the  condition,  being  left  in  doubt  as  to  its  meaning, 
should  be  construed  only  to  extend  to  instances  in  which  the  party  dieil  in  tlie 
commission  of  a  felony.  It  has  been  shown  that  a  literal  interpretation  of  this 
clause  would  embrace  cases  not  within  the  intention  of  the  parties.  Xow  the 
words  of  the  condition  are  the  words  not  of  the  assured,  but  of  the  insurers,  in- 
troduced by  themselves  for  the  purpose  of  their  own  exemption  and  protection 
from  liability  ;  both  in  reason  and  justice,  therefore,  no  less  than  upon  acknowl- 
edged ))rinciples  of  legal  construction,  they  are  to  be  taken  most  strongly  against 
those  tliat  sjieak  the  words,  and  most  favorably  for  the  other  part}' ;  for  it  is  no 
more  than  justice  that  if  the  words  are  ambiguous,  he  whose  meaning  they  are 
intended  to  express,  and  not  the  other  party,  should  suffer  by  the  ambiguity. 
5  M.  &  G.  639.  See  note  suh  fin.  The  facts  of  this  case  clearly  show  that  the 
person  slaying  Harper  was  guilty  of  a  crime.  There  is  no  proof  of  the  fact  set  up 
as  a  bar  that  Coryell  slew  Harper  in  self-defence.  Harper  had  abandoned  the 
conflict,  retreated  as  far  as  possible,  and  endeavored  to  screen  himself  from  the 
attack  of  his  assailant.  His  having  a  stick  of  wood  in  his  hand  at  the  time  he 
was  slain  did  not,  in  the  least,  extenuate  the  guilt  of  Coryell.     Under  the  circum- 

699 


§  327  A]      INSURANCE  :    FIRE,    LIFE,    ACCIDENT,    ETC.        [CH.  XVI. 

that  the  death  was  the  result  of  a  violation  of  law  by  the 
insured,  and  the  policy  was  void.^  But  where  G.,  a  con- 
spirator to  rob  the  State  treasury,  on  coming  out  of  the  door 
with  the  money  was  shot  down  by  the  watchman  (unneces- 
sarily, since  he  could  easily  have  been  captured  without  fir- 
ing, in  all  probability),  it  was  held  that  he  did  not  die  while 
violating  the  law  in  such  sense  as  to  avoid  the  policy,  the 
judge  comparing  the  case  to  one  where  a  man  makes  an 
assault  in  a  building,  and  on  coming  out  of  it  is  attacked 
and  killed.^  We  do  not  think  the  decision  or  the  attempted 
parallel  correct.  He  had  not  ceased  to  violate  the  law  in 
the  case  at  bar,  as  in  the  case  supposed.  Every  step  with 
the  State's  money  away  from  the  bank  was  a  part  of  the 
action  necessary  to  complete  his  crime,  get  the  booty  into 
his  safe  custody,  and  deprive  the  State  of  it.  Every  such 
step  was  a  violation  of  law.  It  was  in  consequetice  of  his 
violation  of  law  and  duririg  it  that  he  was  killed,  and  a  re- 
covery was  absurd.  And  it  is  of  no  consequence  whether 
the  death  resulted  from  the  violation  of  criminal  law,  or  of 
a  rule  of  civil  law,  if  the  breach  was  such  as  increased  the 
risk  and  led  naturally  to  death  or  to  injuries  causing  it. 
One  who  violently  assaults  the  wife  of  another  must  know 
that  he  endangers  his  life  through  the  probable  action  of  her 
husband.^  In  New  York  under  the  code  successful  suicide 
is  not  a  crime,  and  does  not  avoid  a  policy  under  the  clause 

stances  Harper  would  have  been  justified  had  he  shiin  Coryell.  This  is  made  so 
by  our  statute.  He  would  have  been  excused  by  the  common  law.  If  A.  upon  a 
sudden  quarrel  assaults  B.  first,  and  upon  B.'s  returning  the  assault  A.  really  and 
bona  fide  flees,  and,  being  driven  to  the  wall,  turns  again  upon  B.  and  kills  him, 
this  is  se  defendendo.  1  Hale,  480  ;  Fostei',  273.  By  the  twelfth  section  of  the 
second  article  of  the  act  concerning  crimes  and  punishments,  it  is  enacted  that 
every  person  who  shall  unnecessarily  kill  another,  either  while  resisting  an  at- 
tempt by  such  other  person  to  commit  any  felony  or  do  any  other  unlawful  act, 
after  such  attempt  shall  have  failed,  shall  be  deemed  guilty  of  manslaughter  in 
the  second  degree.  Now  if  one  dies  under  circumstances  which  would  justify  him 
in  slaying  his  adversary,  and  when  the  person  causing  his  death  is  thereby  guilty 
of  a  felony,  is  it  not  a  gross  perversion  of  language  to  say  that  the  person  died  in 
the  known  violation  of  a  law  of  the  land  ? "  Overton  v.  St.  Louis,  &c.  Ins.  Co., 
39  Mo.  122. 

1  [Murray  v.  New  York  Life  Ins.  Co.,  30  Hun,  428  ;  96  N.  Y.  614.] 

2  [Grifhn  v.  Western  Mut.  Ass.,  20  Neb.  620.] 

8  [Bloom  V.  Franklin  Life  Ins.  Co.,  97  Ind.  478.] 

700 


CH.  XVI.]  OF    DEATH    BY   LAW,   ETC.  [§  328 

against  liability  in  case  of  death  "in  violation  of,  or  at- 
tempt to  violate,  any  criminal  la\v.^(rt)  But  an  unsuccessful 
attempt  to  commit  suicide  is  criminal. ^  Suicide  to  avoid 
arrest  and  trial  for  a  crime  committed  is  not  death  "  in  con- 
sequence of  a  violation  of  law."  The  crime  is  not  the 
proximate  cause  of  death,  and  the  suicide  itself  is  not  a 
crime  within  the  meaning  of  the  clause. ^  In  Massachusetts 
an  attempt  to  commit  suicide  is  not  indictable.*] 

§  328.    In  a  case  in  Massachusetts,^  in  which  it  appeared 

1  [Darrow  v.  Family  Fund  Soc,  42  Hun,  245  ;  Freeman  v.  National  Benefit 
Soc,  42  Hun,  252,  and  next  note.] 

^  [Id.  and  Darrow  v.  Family  Fund  Soc,  116  N.  Y.  537.  New  York  believes 
in  success  in  all  undertakings,  and  discourages  failure.] 

3  [Kerr  v.  Minneapolis  Mut.  Ben.  Ass.,  39  Minn.  174.] 

4  [Commonwealth  v.  Dennis,  105  Mass.  162.] 

5  Cluff  V.  Mut.  Ben.  Life  Ins.  Co.,  13  Allen  (Mass.),  308.  The  same  case  was 
again  before  the  court,  rejjorted  ut  supra,  when,  by  Foster,  J.,  it  took  occasion 
to  state  its  views  more  at  large :  "In  the  opinion  of  the  court,  the  condition  that 
the  policy  should  be  null  and  void,  among  other  grounds,  in  case  the  insured  should 
die  '  by  the  hands  of  justice,  or  in  the  known  violation  of  any  law '  of  the  State 
or  country  where  he  resided,  or  which  he  was  permitted  to  visit,  must  be  con- 
strued to  refer  to  a  voluntary  criminal  act  on  the  part  of  the  insured,  known  by 
him  at  the  time  to  be  a  crime  against  the  law  of  such  State  or  country.  Applying 
the  maxim  noscitur  a  sociis,  and  remembering  that  such  a  clause  ought  not  to  be 
so  interpreted  as  to  work  a  forfeiture  unless  that  intention  is  apparent,  as  well  as 
from  the  natural  import  of  the  words  'known  violation  of  law,'  we  conclude  that 
they  do  not  extend  to  mere  trespasses  against  property  or  other  infringements  of 
civil  laws  to  which  no  criminal  consequences  are  attached.  The  forcible  taking 
of  the  horses  from  Cox,  if  done  under  an  honest  claim  of  right,  however  ill- 
founded,  would  not  constitute  the  crime  of  robbery  or  larceny  ;  because  where  a 
party  sincerely,  although  erroneously,  believes  that  he  is  legally  justified  in  tak- 
ing property,  he  is  not  guilty  of  the  felonious  intent  which  is  an  essential  ingre- 

(«)  This  is  also  the  rule  in  "Wiscon-  serve  Fund  L.  Ass'n,  62  Minn.  39.     In 

sin,  although  suicide  is  there  treated  as  Missouri,    suicide   is  by  statute  not   a 

technically  a  crime  at  common  law,  un-  defence  unless  contemplated  by  the  as- 

der  a  policy  excluding  death  in  violation  sured  in  applying  for  the  policy.     See 

of  law,  containing  no  suicide  clause,  and  Knights  Templar  Ind.  Co.  v.  Berry,  50 

making  the  policy  incontestable,  except  Fed.    Rep.   511;  .Fltna  L.   Ins.    Co.   v. 

for  non-payment  of  premiums  or  misrep-  Florida,  69  id.  932;  Ticktin  v.  Fidelity 

resentation  of  age.     Patterson  v.  Natu-  &  Cas.  Co.,   87  id.   543 ;   Christian   v. 

ral  Premium  M.  L.  Ins.  Co.,  100  Wis.  Conn.  Mut.  L.  ii.s.  Co.,  143  Mo.  460  ; 

118,    126.      As   to   such    incontestable  Jarman  v.  Knights  Templars'  L.  Ind. 

clause,    see   Clement  v.   New  York   L.  Co.,    95    Fed.    Rep.    70  ;    Haynie    v. 

Ins.  Co.  (Tenn.),  42  L.  R.  A.  247,  note  ;  Knights   Templar.s'    L.    Ind.    Co.,  ^139 

Mass.  Benefit  L.  Ass'n  v.  Robinson,  104  Mo.    416  ;    McDonald    v.    Bankers'   L. 

Ga.   256;  Simpson  o.   Va.  L.  Ins.  Co.,  Ass'n  (Mo.),  55  S.  W.  999. 


115  N.  C.  393;  Mareck  v.  Mutual  Re- 


701 


§  328]  INSURANCE  :    FIRE,   LIFE,    ACCIDENT,    ETC.         [CH.  XVI. 

that  the  insured  was  killed  in  an  altercation,  brought  on  by 
an  attempt  on  his  part  to  unhitch  a  pair  of  horses  attached 

dient  of  these  crimes.  Neither  does  the  taking  of  horses  from  a  vehicle  to  which 
they  are  harnessed  amount  to  an  assault  upon  the  driver,  unless  accomiianied  by 
violence  or  threats  of  violence  against  him.  An  assault  is  an  intentional  attempt 
by  force  to  injure  the  person  of  another.  Commonwealth  v.  Ordway,  12  Cush. 
270.  A  battery  is  committed  whenever  the  menaced  violence  of  an  assault  is  done 
in  the  least  degree  to  the  person.  Either  an  assault  or  battery  would  be  a  crime 
within  the  condition  of  the  policy,  unless  justified  as  a  measure  of  necessary  self- 
defence.  Assuming  that  Cluff  did  conunit  a  criminal  assault,  it  may  not  neces- 
sarily follow  that  he  died  in  the  known  violation  of  law.  If  he  was  shot  while 
the  assault  continued,  such  would  be  the  case.  But  if  it  had  ceased  and  Cluff 
was  not  threatening  to  renew  it,  and  Cox  had  withdrawn  out  of  his  reach  and 
then  shot  him,  not  in  the  course  of  the  affray,  but  merely  to  revenge  himself  for 
what  had  been  done,  or  to  prevent  the  seizure  of  the  horses,  then  at  the  time  he 
was  killed  Cluff  was  not  engaged  in  a  known  violation  of  the  law,  within  the 
meaning  of  the  policy.  For  he  must  have  received  the  mortal  wound  during  and 
while  engaged  in  the  commission  of  a  crime,  not  merely  in  consequence  of  it  after- 
wards. But  the  jury,  upon  all  the  evidence,  should  consider  whether,  if  he  is 
proved  to  their  satisfaction  to  have  been  once  engaged  in  a  criminal  assault,  he 
can  be  deemed  to  have  desisted  from  it,  while  persisting  continuously  in  the  very 
act  in  the  course  of  which  the  affray  occurred.  Their  attention  should  be  called 
distinctly  to  the  question  whether,  if  Clutf  had  committed  a  criminal  assault,  it 
was  so  far  ended  when  he  was  fired  upon  that  the  fatal  shot  is  to  be  regarded  as 
a  new  and  independent  event,  rather  than  a  mere  continuation  of  the  original 
aflFra)'.  If  Cluff  committed  a  criminal  assault  on  Cox,  which  the  latter  immedi- 
ately returned  by  a  fatal  blow,  then  the  death  would  have  been  occasioned  in  a 
known  violation  of  law,  although  the  jury  might  believe  that  Cluff  was  not  at  the 
moment  intending  to  commit  any  further  assault.  The  question  to  be  considered 
is,  were  the  two  acts  —  the  assault  by  Cluff  and  the  firing  of  the  pistol  by  Cox  — 
a  part  of  one  conflict  for  the  possession  of  the  horses,  or  had  Cox  abandoned  his 
attempt  to  regain  the  custody  of  the  horses,  and  had  Cluff  desisted  from  his  as- 
sault ?  Was  the  fight  over,  or  had  Cox  merely  retired  to  a  more  advantageous 
position  ?  In  short,  if  Cluff  in  the  first  instance  did  commit  a  criminal  assault, 
and  the  firing  of  the  pistol  was  a  part  of  tlie  same  continuous  transaction,  then  the 
condition  of  the  policy  was  violated.  It  must  also  appear  that  the  death  was 
caused  or  occasioned  by,  or  resulted  from,  the  criminal  act.  The  loss  of  life  must 
be  connected  with  the  crime  as  its  consequence.  By  reason  of  the  guilty  act  the 
death  must  have  occurred,  so  that  without  its  commission  it  would  not  have  taken 
place.  In  the  opinion  of  a  majority  of  the  court  it  is  not,  however,  essential  that 
the  deceased  should  have  known,  or  have  had  reason  to  believe,  that  his  criminal 
act  would  or  might  expose  his  life  to  danger.  The  fact  that  the  crime  actually  did 
produce  the  death  is  sufficient  to  avoid  the  policy,  without  regard  to  the  proba- 
bility that  such  a  result  would  ensue."  To  this  extent  the  ruling  of  the  court, 
when  it  first  came  before  them,  and  not  then  requiring  any  more  explicit  ruling 
upon  this  point,  was  modified  in  the  second  consideration  of  the  case.  On  excej)- 
tions  after  a  third  trial,  it  was  held  that  the  honest  belief  in  the  right  to  do  the 
act,  while  doing  which  the  insured  was  shot,  must  be  a  belief  in  his  legal  right 
to  do  the  acts,  and  not  a  mere  belief  in  the  right  of  self-redress  on  account  of  the 
disturbed  condition  of  the  country,  the  inefficient  administration  of  the  laws,  or 
otherwise.     99  Mass.  317. 

702 


^^'  ^^^'^-l  OF   DEATH    BY    LAW,    ETC.  [§  329 

to  the  wagon  of  another,  who,  the  insured  alleged,  owed  him 
a  bill,  and  while  the  insured  was  proceeding  to  take  posses- 
sion of  the  horses,  as  a  means  of  enforcing  the  payment  of 
the  bill  alleged  to  be  due  him,  when  he  was  shot  by  the 
driver  of  the  horses,  the  court  held,  on  a  question  as  to 
whether  there  was  evidence  for  a  jury,  that  if  the  insured 
when  he  was  shot  was  engaged  in  a  criminal  violation  of 
law  (of  which  there  was  evidence  to  go  to  a  jury),  known  by 
him  to  be  so,  and  if  such  violation  of  law  might  have  been 
reasonably  expected  to  expose  him  to  violence  which  might 
endanger  life,  the  case  was  within  the  exception. 

§  329.  In  Bradley  v.  Mutual  Benefit  Life  Insurance  Com- 
pany,! ^yhich  was  an  action  upon  substantially  the  same 
form  of  policy,  and  upon  the  same  life,  the  views  of  the  court 
were  substantially  in  accordance  with  those  of  the  Supreme 
Court  of  Massachusetts,  except  upon  the  point  that  the  vio- 
lation of  law  must  be  a  criminal  act.  Upon  this  point  the 
Supreme  Court  held  that  any  act  in  violation  of  law  which 
would  naturally  lead  to  a  conflict  by  which  the  life  of  the 
insured  would  be  endangered  would  come  within  the  excep- 
tion. But  the  case  was  sent  back  on  another  point,  and  the 
question  is  still  an  open  one  in  New  York.  2  The  majority 
of  the  Court  of  Appeals  seem  to  have  been  inclined  to  take 
the  same  view  of  the  import  of  the  proviso  as  had  already 
been  taken  by  the  Supreme  Courts  of  Massachusetts  and 
Missouri ;  while  the  minority  held  that  the  proviso  embraced 
the  violation  of  any  law  when  the  violation  was  of  such  a 
character  as  to  tend  directly  to  endanger  life.'^ 

1  3  Lans.  (X,  Y.)  341  ;  s.  c.  in  the  Court  of  Appeals,  45  N.  Y.  (6  Hand.)  422. 

2  The  proviso   excepted  liability  from  death  "  in   case  the  insured  shall  die  ' 
by  his  own  hand,  or  in  consequence  of  a  duel,  or  by  reason   of  intemperance 
from  the  use  of  intoxicating  liquors,  or  by  the  hands  of  justice,  or  in  the   known 
violation  of  law  of  these  States  or  of  the  United  States." 

^  The  argument  in  favor  of  this  view  is  well  stated  by  Jlr.  Justice  Orover  i?i 
his  dissenting  opinion,  who,  after  stating  the  doctrine  as  held  by  the  Jlassiu-hu- 
setts  Supreme  Court,  thus  proceeds:  "This  was  so  held.  .  .  upon  an  applica- 
tion of  the  maxim  nosr.itnr  a  sociis.  How  this  maxim  can  a]>ply  to  tlie  present 
case,  or,  if  applied,  how  the  conclusion  deduced  by  the  court  therefi-om  follows,  I 
am  unable  to  perceive.  Among  the  associates  is  that  of  the  death  happening  by 
reason  of  intemperance  from  the  use  of  intoxicating  Hijuors.  It  is  obvious  that, 
if  the  death  happened  from  this  cause,  the  case  would  come  within  tlie  proviso 

703 


§  329]         INSURANCE  :    FIEE,    LIFE,    ACCIDENT,   ETC.  [CH.  XVI. 

In  a  still  later  case,  where  it  appeared  that  the  insured 
came  to  her  death  bj  reason  of  a  miscarriage,  produced  by 
an  illegal  operation  performed  upon  her,    and  voluntarily 

whether  such  use  of  intoxicating  liquors  was   prohibited   by  the  criminal  law 
of  the  State  where  it  occurred  or  not  ;  appl3'ing  the  maxim  to  this,  it  niifht  with 
equal  propriety  be  argued  that  it  was  not  the  criminal  law  that  was  had  in  view 
by  the  parties,  as  that  it  was  such  law,  because  death  by  the  hands  of  justice  is 
also  included  by  the  same  proviso.     To  arrive  at  the  intention  of  the  parties  to 
the   contract   we   must   consider   the  subject-matter  in   reference  to  which  the 
language  was  used.     What  was  the  risk  to   be  incurred    by  the  defendant  in 
insuring  the  life  of  Cluff  ?     From  the  i^olicy  it  appears  that  the  defendant  was 
willing  to  assume  all  the  general  risks  to  be  incurred  by  such  insurance  to  the 
extent  of  the  amount  insured.     From  the  proviso  it  appears  that  the  defendant 
was  unwilling  to  incur,  and  therefore  refused  to  assume,  the  additional  risks  to 
his  life  incurred  while  the  assured  was  engaged  in  the  prohibited  acts  specified  in 
the   proviso,  and  therefore  carefully  provided   that   it  should  not  be  liable  in 
case  of  death  while  engaged  in  the  prohibited  acts.     Keeping  these  considera- 
tions  in  view,   there    will   be  but  little  difficulty  in  arriving  at  the  intention 
of  the  parties,   and,   consequently,  at  the  coirect  construction  of  the  proviso. 
It   is  obvious   that   the   violation    of    law   in    which   the    insured   is   engaged, 
whether   such  law  be  criminal  or  civil,   must  have  some  connection   with  the 
death,  as  cause   and  effect, — not  necessarily  the  immediate  cause,  as  it  is  suffi- 
cient if  it  puts  in   operation   that  cause.     To  illustrate  :  The  sale   of  lottery- 
tickets  is  prohibited  by  the  criminal  law  of  New  York.     No  one  would  contend 
that  had  the  assured  died  in  the  State  of  New  York  from  heart  disease,  while 
engaged  in  selling  lottery-tickets,  the  case  would  have  come  within  the  proviso. 
It  might  have  been  within  the  strict  letter,  but  not  at  all  within  the  intention 
of  the  parties,  for  the  reason  that  the  violation  of  law,  although  criminal,  had  no 
possible  connection  with  the  death,  and  in  no  possible  way  increased  the  risk. 
Again,  the  criminal  law  of  New  York  prohibits  profane  cursing  and  swearing. 
Su[ipose  the  death  happened  from  some  accident  while  the  assured  was  violating 
the  law,  would  this  bring  the  case  within  the   proviso  ?     Clearly  not,  for  the 
reasons  above  stated.     (See  also  ante,  §  246.)     Again,  suppose  the  death  occurred 
from  injury  received  while  the  assured  was  attempting  to  obtain  by  force   the 
possession  of  a  chattel  of  which  another  was  in  peaceable  possession,  the  title  to 
which  was  claimed  by  both,  but  which  was  really  in  the  assured,  the  case  would 
come  within  the  proviso,  for  the  reason  that  the  risk  was  increased  and  the  death 
caused  by  the  violation  of  law  by  the  assured,  although  such  law  was  the  civil  law 
only,  the  deceased  having  committed  no  breach  of  the  peace  or  any  indictable 
offence.     The  Massachusetts  court  held  in  the  same  case,  when  again  before  it 
(99  Mass.  318),  that  the  case  would  have  come  within  the  proviso  had  the  assured 
at  the  time  of  being  shot,  in  furtherance  of  his  attempt  to  get  the  horses  fiom 
Cox,  been  committing  an  assault  and  battery  upon  him.     The  court,  I  think,  must 
have  overlooked  the  fact  that  the  violation   of  law  in  which  the  insured  was 
engaged  was  eminently  calculated  to  cause  violence  dangerous  to  his  life  to  be 
inflicted  upon  him,  and  that  the  very  object  of  the  proviso  was  to  exonerate  the 
defendant  from  liability  should  death  incur  from  this  voluntary  increase  of  risk. 
It  follows  that  when  the  death  occui's  during  the  known  violation  of  law  by  the 
assured,   when  such  violation  eminentl}'  tends   to    violence  dangerous   to   life, 
the  case  comes  within  the  proviso." 

704 


CH.  XVI.]  OF    DEATH    BY   LAW,   ETC.  [S  332 

submitted  to  by  her,  with  intent  to  cause  an  abortion, 
without  any  justifiable  medical  reasons,  it  was  held  on 
grounds  of  public  policy  that  there  could  be  no  recovery,  i 
The  death  must  also  happen  while  in  the  violation  of  law, 
though  the  language  of  the  condition  be  "in  consequence  of." 
Thus,  if  a  man  be  killed  while  in  the  act  of  adultery,  the 
policy  is  void.  If  he  be  afterwards  killed  on  account  of  the 
adultery  as  a  provocation,  the  policy  is  not  void.^ 

§  330.  Death  by  Violence  covered  by  Policy  unless  ex- 
pressly excepted.  —  A  life  policy  covers  death  by  violence  in 
whatever  form,  as  well  as  from  natural  causes,  unless  the 
particular  form  of  violence  is  an  expressly  excepted  clause. ^ 

§331.  Violation  of  Law  ;  Evidence.  —  All  the  authorities 
agree  that,  unless  it  appear  to  the  contrary,  the  criminal 
laws  of  all  civilized  countries  will  be  presumed  to  be  the 
same  as  those  having  jurisdiction  of  the  case.* 

§  332.  Military  Service  ;  Death  by  Casualty  or  Consequence 
of  War ;  Belligerent  Forces ;  Permit.  —  The  force  and  effect 
of  the  not  uncommon  exemption  from  liability  if  the  insured 
shall  enter  into  the  military  service,  and  the  scope  of  a  per- 
mit to  disregard  the  condition  of  the  policy  against  residing 
beyond  a  certain  degree  of  latitude,  were  considered  in  Welts 
V.  Connecticut  Mutual  Life  Insurance  Companv,"  where  it 
was  held  that  death  from  a  roving  band  of  banditti,  thieves, 
and  robbers,  such  as  usually  disturb  communities  during 
insurrectionary  periods,  is  not  one  of  the  "casualties  or  con- 
sequences of  war  or  rebellion,"  nor  is  it  a  death  from  "bel- 
ligerent forces."  And  it  was  also  held  that  under  a  permit 
to  reside  in  a  district  known  to  be  in  a  state  of  war,  when 
hostile  armies  are  contending  for  its  possession,  subject  to 

1  Hatch  V.  Mut.  Life  Ins.  Co.,  120  Mass.  550. 

2  Goetzmann  v.  Conn.,  &c.  Ins.  Co.,  5  T.  &  C.  (N.  Y.)  572.  See  also  post, 
§  530. 

3  Spruill  V.  North  Carolina  Mut.  Life  Ins.  Co.,  1  Jones  (North  Carolina) 
Law,  126. 

*  Cluff  V.  Mut.  Ben.  Life  Ins.  Co.,  13  Allen  (Mass.),  308  :  Ai-ayo  v.  Cnn-el, 
1  La.  528  ;  Savage  v.  O'Neil,  42  Barb.  (X,  Y.)  374  ;  Holmes  v.  Bronphtoii.  10 
Wend.  (X.  Y.)  75  ;  Bradley  v.  Mut.  Ben.  Life  Ins.  Co.,  3  Lans.  (N.  Y.)  341  ; 
S.  c.  45  N.  Y.  422. 

s  46  Barb.  (N.  Y.)  412. 

VOL.  I.  — 45  705 


§  332]  INSURANCE:    FIEE,   LIFE,   ACCIDENT,   ETC.  [CH.  XYI. 

the  stipulation  that  the  insurers  shall  not  be  liable  on  ac- 
count of  a  death  happening  from  such  casualties  or  forces,  a 
condition  in  the  policy  against  entering  military  service  is 
so  far  modified  that  the  insured  may  engage  in  the  inci- 
dental service  of  bridge  building,  not  in  the  vicinity  of  any 
hostile  force,  without  prejudice  to  his  right  to  recover  under 
the  policy,  1 


1  The  facts  in  the  case,  and  the  conclusions  of  the  court  thereon,  are  thus 
stated  by  Smith,  J.  :  "  By  this  permit  Welts  was  permitted  to  pass,  by  the 
usual  route  and  means  of  public  travel,  to  any  part  of  the  United  States  south  of 
the  thirty-sixth  degree  of  north  latitude,  and  reside  there,  or  return,  during  the 
term  of  one  year  from  the  date  of  such  permit,  without  prejudice  to  said  policy  ; 
provided,  and  the  said  permit  was  issued  with  the  understanding  and  agreement 
of  the  parties  in  interest,  '  that  the  said  Welts  was  not  insured  by  said  policy 
against  death  from  any  of  the  casualties  or  consequences  of  the  war  or  rebellion, 
or  from  belligerent  forces,  in  any  place  where  he  maybe.'  If  this  permit  had  not 
been  given  when  all  that  part  of  the  United  States  south  of  the  thirtj'-sixth 
degree  of  north  latitude  was  in  a  state  of  insurrection  and  war,  and  covered  more 
or  less  with  hostile  armies,  I  should  have  considered  that  Welts  came  to  his  death 
from  the  causes  covered  by  the  proviso,  and  excepted  from  the  policy.  But  he 
was  permitted  to  go  into  any  or  all  the  insurrectionary  States  south  of  the  line  of 
the  thirty-sixth  degree  of  north  latitude  ;  the  insurers  well  knowing,  as  well 
as  the  assured,  of  the  existence  of  the  war  of  the  rebellion  in  all  of  these  States. 
The  assured  paid  an  extra  }>remium  for  such  permit.  He  was  killed  where, 
under  the  permit,  he  had  a  right  to  be  ;  he  was  not  killed  by  rebels  in  any 
encounter  of  arms ;  he  was  engaged  in  no  battle,  or  near  any  ;  he  was  twenty 
miles  or  more  in  the  rear  of  the  United  States  forces  at  Nashville,  and  it  does  not 
appear  that  there  was  any  rebel  force  at  the  time  north  of  the  Cumberland  ;  he 
was  not  exposed  to  any  war  peril,  except  such  as  existed  through  all  the  peaceful 
parts  of  Kentucky  and  Tennessee.  Having  the  right  to  be  in  the  place  in  which 
he  was  killed,  the  risk  Welts  then  ran  was  one  covered  by  the  permit.  He 
was  engaged  in  no  warlike  enterprise.  He  was  simply  rebuilding  railioad  bridges 
far  in  the  rear  of,  and  away  from  any  hostile  forces.  The  band  by  which  he  was 
killed  were,  it  seems,  mere  roving  robbers,  robbing  Union  men  and  rebels  alike. 
They  did  not  interfere  with  the  work  in  which  Welts  was  engaged.  They  did 
not  destroy  railroads  or  bridges,  or  make  prisoners  of  any  persons  in  Welts'  com- 
pany, or  others.  They  merely  robbed  the  members  of  the  company  of  their  money, 
making  no  demonstrations  indicating  that  tliey  were  Confederate  soldiers,  or  act- 
ing in  the  interest  of  the  rebel  government.  It  is  true  that  Welts  ran  the  peril  of 
encountering  such  robbers  by  going  into  Tennessee  ;  but  this,  I  think,  was  part 
of  the  risk  contemplated  by  the  permit.  The  same  peril  would  have  been  encoun- 
tered if  he  had  been  travelling  quietly  in  that  section  of  country,  simply  passing 
from  one  place  to  another  in  any  part  of  the  United  States  south  of  the  line  of 
thirty-six  degrees  of  north  latitude.  This  permit  is  to  be  construed  with  refer- 
ence to  the  known  condition  of  the  country  at  the  time  it  was  given,  and  the 
parties  must  both  be  deemed  to  have  known  what  the  ordinarj'  perils  were  in  the 
country  where  the  insured  proposed  to  go,  and  their  contract  must  be  interpreted 
in  the  light  of  this  assumption." 

706 


CH.  XVI.]  OF   DEATH    BY    LAW,    ETC.  [§ 


OOO 


This  case  was  affirmed  by  the  Commission  of  Appeals,  * 
the  court  observing,  amongst  other  things,  "that  the  general 
understanding  of  the  term  includes  such  persons  only  as  are 
liable  to  do  duty  in  the  field  as  combatants."  But  death 
in  the  military  service  of  an  enemy,  whether  excepted  from 
the  risk  or  not,  or  referred  to,  or  even  specially  permitted, 
would  doubtless  be  held  to  be  not  within  the  protection  of 
a  policy  of  insurance  as  against  public  policv.- 

§  333.  Military  Service,  What  constitutes  entering.  —  In 
Mitchell  V.  Mutual  Life  Insurance  Company  of  New  York,^ 
it  appeared  that  the  insured  went  South  after  the  breaking 
out  of  the  rebellion,  and  served  on  the  staff  of  several  gen- 
erals, though  he  received  no  commission.  And  the  court 
thought  that  if  the  insured  connected  himself  in  any  form 
with  the  belligerent  force,  whether  he  had  a  commission  or 
not,  he  entered  the  military  service,  within  the  meaning  of 
the  policy.  But  a  mere  clerical  position  in  the  office  of  the 
Adjutant-General,  subject  to  no  military  order  or  service, 
is  not  entirely  such  service  within  the  meaning  of  the 
policy.* 

§  334.  Military  Service,  Voluntary  or  Involuntary.  —  In  Dil- 
lard  V.  Manhattan  Life  Insurance  Company, °  the  insured, 
threatened  with  conscription,  entered  the  Confederate  ser- 
vice, and  occupied  the  position  of  brigade -post-quarter- 
master. It  was  claimed  by  the  plaintiff  that  this  was 
substantially  an  involuntary  entering  the  service  on  the 
part  of  the  insured,  and  if  not,  was  for  the  benefit  of  the 
insurers,  as  the  risk  was  less  than  it  would  have  been  to 
take  the  chances  of  compulsory  service  through  conscription. 
But  the  court  did  not  sustain  these  views. 

§  335.  Restrictions  upon  Residence ;  License  to  Travel.  — 
Where,  by  the  terms  of  the  policy,  the  residence  of  the  in- 
sured is  restricted  within  certain  specified  limits,  and  a 
license  is  given  to  remain  without  those  limits  till  a  cer- 

1  4S  K  Y.  34.  2  Ante,  §  37. 

3  Decided  in  the  Superior  Court  of  Baltimore,  and  cited  by  Bliss,  Ins.  643. 

«  New  York  Life  Ins.  Co.  v.  Hendren,  24  Grat.  (Va.)  536,  540. 

*  44  Ga.  119. 

707 


§  336]  INSURANCE  :    FIEE,   LIFE,    ACCIDENT,   ETC.  [CH.  XVI. 

taiu  period,  inability  bv  reason  of  sickness  and  death  to 
return  within  the  time  stated  in  the  license  was  held  not  to 
■work  a  forfeiture,  as  the  assured  was  excused  on  account  of 
his  inability,  which  was  the  act  of  God.^ 

It  has  since,  however,  been  held  that  if  such  facts  consti- 
tute an  excuse  in  any  case,  they  do  not  apply  where  the  in- 
sured, already  in  feeble  health,  goes  without  the  restricted 
limits,  and  remains  there  until  he  is  too  feeble  to  return. 
In  such  case  the  insured  takes  the  risk,  and  cannot  allege 
the  impossibility  of  return  as  an  excuse. - 

§  336.  Restrictions  upon  Residence  and  Travel.  —  But  where 
there  was  a  condition  that  the  insured  should  not  remain 
more  than  five  days  within  certain  limits,  on  penalty  of 
forfeiture,  and  the  insured  remained  there  ten  days,  when 
he  was  taken  sick,  and  died  within  the  prohibited  limits,  it 
was  held  that  there  could  be  no  recovery  under  the  policy, ^ 
whether  the  violation  of  the  condition  was,  or  was  not,  in 
any  way  the  cause  of  the  death.  In  another  case,  where 
there  was  a  permit  to  travel  by  one  route,  and  the  insured 
travelled  by  another,  but  the  change  had  no  materiality  to 
the  risk,  the  court  were  divided  in  opinion  as  to  whether 
this  would  be  a  defence.^  The  indorsement  upon  a  policy, 
however,  of  a  permit  which  purports  to  grant  privileges  for 
a  consideration  paid  therefor,  which  are  only  such  as  may  be 
enjoyed  under  the  provisions  of  the  policy,  will  not  restrict 
the  rights  of  the  insured  under  the  policy,  —  rights  for  which 
he  had  already  contracted  and  paid.  These  rights  may  be 
availed  of  as  if  no  permit  had  been  indorsed;*  and  if  such 


1  Baldwin  v.  Xew  York  Life  Ins.  Co.,  3  Bosw.  (X.  Y.  Superior  Ct.)  530. 
Hoffman,  J.,  also  gave  a  separate  opinion  to  the  same  effect,  in  which  the 
cases  illustrative  of  tlie  doctrine  that  non-performance  of  an  ohlicration  may  be 
excused  when  it  becomes  impossible  by  the  act  of  God,  are  carefully  collected 
and  stated. 

2  Evans  v.  United  Stales  Life  Ins.  Co.,  64  N.  Y.  304,  affirming  s.  c.  3  Hun, 
587,  and  apparently  overruling  the  case  of  Baldwin  i*.  New  York  Life  Ins.  Co., 
supra.  See  Wheeler  v.  Conn.  Life  Ins.  Co.  (N.  Y.)  10  Ins.  L.  J.  116,  120.  See 
also  post,  §  352. 

3  Nightingale  V.  State  Mut.  Life  Ins.  Co.,  5  R.  I.  38. 

4  Bevin  v.  Conn.  Mut.  Life  Ins.  Co.,  23  Conn.  244. 

5  Forbes  ^•.  American  Mut.  Life  Ins.  Co.,  15  Gray  (Mass.),  249. 

703 


CH.    XV;.]  OF   DEATH    BY    LAW,    ETC.  [§337 

an  indorsement  be  made  at  the  time  the  policy  is  issued,  it 
is  to  be  regarded  as  part  of  the  policy,  modifying  any  condi- 
tion to  which  it  relates.^  But  a  permit  to  proceed  to  a  par- 
ticular place  without  the  limits  to  which  the  insured  is 
restricted  by  the  terms  of  the  policy,  written  on  a  receipt 
for  the  premium  paid  at  the  time  of  taking  out  the  policy, 
is  no  part  of  the  policy,  but  a  separate  and  independent 
agreement.  Such  a  permit  authorizes  the  insured  to  go  be- 
yond the  restricted  limits,  but  not  to  reside  there,  except  as 
allowed  under  the  terms  of  the  policy. ^  (a) 

§  337.  Restrictions  upon  Residence  and  Travel ;  Settled 
Limits.  —  The  ••  settled  limits  "  of  the  United  States  means 
the  established  boundaries  of  the  Union,  and  a  death  be- 
yond the  region  of  actual  settlement  is  covered  by  the  policy. 
The  word  "settled"  in  such  a  case,  and  in  its  connection 
with  the  word  "limits,"  is  equivalent  to  '"fixed"  or  "estab- 
lished." In  the  sense  of  occupied  or  inhabited,  it  would 
give  rise  to  great,  if  not  insurmountable,  difficulties  of 
proof,  and  would  be  so  vague  and  uncertain,  that  courts 
should  not  uphold  such  a  view  unless  upon  the  clearest  evi- 
dence that  such  was  the  intention  of  the  parties.^  "The 
primary  definition  of  the  word  'settled,'"  said  Selden,  J., 
"  is  fixed,  placed,  established.  It  is  true  it  is  also,  though 
more  rarely,  used  as  descriptive  of  a  section  of  country  that 
is  'planted  with  inhabitants;'  but  it  is  obvious  that  it  can 
never,  with  propriety,  be  used  in  the  latter  sense  in  con- 
nection with  the  word  'limits.'  Limit  means  boundary, 
border,  the  outer  line  of  a  thing,  and  nothing  else,  except 
when  used  to  convey  the  idea  of  restraint.     There  may  be 

1  Raiasford  r.  Roval  Ins.  Co.,  1  Jones  a:  Spencer  (X.  Y.  Superior  Ct.),  453. 

2  Ibid. 

8  Casler  v.  Conn.  Mut.  Life  Ins.  C«.,  22  N.  Y.  (8  Smith)  427.  —  Comstock, 
C.  J.,  and  two  other  jn<iges  dissenting,  who  held  that  the  words  were  eqnivalent 

to  the  "region  of  settlement." 

(a)  A   pei-mit    to  travel    in   regions  are    accustomed    to   do.      Converse  v. 

where  the  policv  prohibits  residence  is  Knights   Templars'  Ind.  Co.,   93  Fed. 

construed  liberally,  so   as  to  give   the  Rep.  148.   151  ;  Benefit  L.  Ins.  Co.  v. 

privilege  of  going   and  making  reason-  Martin  (Ky.),  55  S.  W.  694. 
able  stops  as  passengers  and  travellers 

709 


§  339]  INSURANCE  :    FIRE,   LIFE,   ACCIDENT,   ETC.        [CH.  XVI. 

a  settled  region,  a  settled  country,  or  a  settled  territory, 
but  there  can  be  no  such  thing  as  a  settled  limit,  in  the 
sense  contended  for."  And  it  was  held  not  to  be  suscep- 
tible of  meaning  "the  region  of  settlement,"  as  contended 
for  by  the  insurers. 

§  338.  Restrictions  upon  Residence  and  Travel ;  License ; 
Construction.  —  A  license  or  permit  about  which  there  is  any 
ambiguity  will  be  construed  most  strongly  against  the  com- 
pany. Thus  a  permit  setting  forth  that  the  insured  is  about 
to  proceed  to,  and  reside  at,  Belize,  and  granting  liberty  to 
reside  there  for  one  year,  may  be  availed  of  for  any  year 
thereafter  during  the  currency  of  the  policy.^  So  a  permis- 
sion to  go  by  sea  in  a  first-rate  vessel  is  not  restrictive  of 
the  mode  of  travel,  whether  by  steerage  or  in  the  cabin.  ^ 
But  a  permit,  clear  in  its  terms,  must  be  strictly  followed, 
or  it  will  afford  no  protection.  Thus  a  permit  to  make  a 
voyage,  out  and  home,  to  California,  round  Cape  Horn  or  by 
the  way  of  Vera  Cruz,  will  not  authorize  making  the  voyage 
by  the  way  of  Panama,  though  this  may  be  the  safer  route. ^ 
A  permit  to  engage  in  sea  service  "on  the  prior  payment 
any  year  of  an  additional  premium  "  does  not  authorize  the 
continuance  of  the  service  beyond  the  year  without  the  pay- 
ment of  an  additional  premium,  and  such  continuance  works 
a  forfeiture  of  the  policy.*  The  condition  remains  in  force 
in  all  its  stringency,  except  so  far  as  it  may  be  modified  by 
the  terms  of  the  permit. 

§  339.  Restrictions  upon  Residence  and  Travel ;  Waiver.  — 
But  the  right  to  insist  upon  a  compliance  with  such  restric- 
tions may  be  waived ;  and  a  receipt  of  the  premium  by  the 
insurers  after  a  known  violation  of  the  condition  against 
residence  abroad,  or  of  the  terms  of  the  permit  granted,  is  a 
waiver  of  their  right  to  claim  a  forfeiture  by  reason  of  such 
violation.^    And  this  is  true  whether  the  knowledge  be  actual 


1  Notinan  v.  Anchor  Ass.  Co.,  4  C.  B.  N.  s.  476. 

2  Taylor  v.  iEtiia  Life  Ins.  Co.,  13  Gray  (Mass.),  4-34. 

3  Hathaway  v.  Trenton  Mut.  Life  Ins.  Co.,  11  Cash.  (Mass.)  448. 

4  Ayer  v.  N.  E.  Mnt.  Life  Ins.  Co.,  109  Mass.  4.30. 

5  Bevin  i".  Conn.  Mat.  Life  Ins.  Co.,  23  Conn.  244. 

710 


CH.  XVI.]  OF   DEATH   BY   LAW,    ETC.  *  [§  339 

or  constructive,  as  where  the  violation  is  known  to  the  agent 
of  the  insurers  who  received  the  premium ;  ^  unless  where  the 
policy  contains  a  notice  to  the  insured  that  the  agent  has  no 
authority  to  waive  the  condition; 2  and  even  thenfif  the  con- 
duct of  the  insurers  misleads  the  insured  to  his  prejudice. ^ 
[But  where  one  whose  life  was  insured  went  without  permis- 
sion of  the  company  south  of  the  line  to  which  his  policy 
ran  at  that  season  of  the  year,  and  died  there,  a  relative, 
ignorant  of  the  death,  paid  the  price  for  a  permit  to  go  south 
to  the  company's  agent,  who  forwarded  vt  requesting  a  per- 
mit. Eleven  days  after,  learning  of  the  death,  the  company 
tendered  back  the  money  received  from  the  relative,  and  it 
was  held  that  there  had  been  no  waiver  of  the  forfeiture.''] 

1  Wing  V.  Harvey,  5  De  G.,  M.  &  G.  265  ;  s.  c.  27  Eng.  L.  &  Eq.  140  ;  Gar- 
ber  V.  Globe,  &c.  Ins.  Co.,  C.  Ct.  (Mo.)  5  Big.  Life  &  Ace.  Ins.  Cas.  221.  And 
see  also  Girdlestone  v.  N.  B.  Mar.  Ins.  Co.,  11  L.  R.  (Eq.)  197. 

2  Lorie  v.  Connecticut,  &e.  Ins.  Co.,  C.  Ct.  (Mo.)  5  Big.  Life  &  Ace.  Ins. 
Cas.  233.     See  also  post,  §  511  a. 

3  Post,  §  356. 

*  [Bennecke  v.  Insurance  Co.,  105  U.  S.  355,  361.] 

711 


END   OF   VOL.   I. 


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